While we all dream of winning an election based on our words and principles alone, half the battle in any campaign is to ensure the candidacy lasts till the day of voting. And that costs money. This is why you need a winning political campaign budget.
“Money in politics is like water running downhill – it finds its way.” – Journalist Jonathan Alter
A good political campaign budget will help you understand everything from campaign finances to political ad spending, from what the largest item in most campaign budgets is to your spending limit.
Your political campaign budget can also plan for Super PACs and small-dollar donations and ensure you aren’t running afoul of the FEC requirements.
Image: US election spends from 1998 to 2022 (in billions) (Image from Open Secrets)
Alongwith explanations for these, the rules you need to follow, and sample budget templates, we will also discuss the various components you need to plan for, and how to sort them into voter outreach and overhead costs.
Have a look.
How to create a winning political campaign budget?
Depending on the office you are running for and the location, there are some variations in the budget that you have to consider. Some of these expenses are measurable at the outset, while some are dependent on the support you draw or how your communication plan works out.
Here are a few of the factors you need to consider when you think about the budget:
- Electorate size: Primaries have fewer voters to contact than a general election. A local election campaign will have even fewer voters to reach out to. So how many voters are you reaching out to?
- The opposition: How many opponents are you up against? How close is the competition? Are you matching their spending?
- Newcomer vs incumbent: A candidate with a recognized name would need to spend less than a first-timer to raise their candidate profile. So that is a major factor
- Voter communication methods: Your contact methods, like phone banking, door-knocking, and community events, have varying expenses. Factor each one and how much of each you plan to use.
- Media coverage: Political party endorsements, press coverage, and supporter action can cost money or be cheaper if they donate it for free. So plan your networking carefully.
With that in mind, here is how you can plan a budget.
Estimate projected spends
The first step is to sit with your campaign finance team and estimate all expenses you will probably encounter. Most broadly, you will spend money in two ways –
- To reach voters and learn more about them
- Overhead or staff costs to support your efforts
Taking the example of UK elections in the past 20 years, we can see that some 60% of your spends will be to reach out to voters in one way or the other. In this case – media, advertising and campaign broadcasts. The next biggest chunk is market research and canvassing.
You will also have to plan some 25% of your budget for real-world rallies, transport, printing of manifestos and posters, and other promotional materials like t-shirts, mugs, badges, flags, etc.
It is best to keep about 10-15% of your spends on staff, salaries, rents, and office supplies. Naturally, this should be kept to a minimum. The remaining 5-10% should be kept as a slush fund for emergencies and unexpected costs.
With this 60-20-10-10 ratio, you can cover the most bases.
Now it is best if you do some market research in your area and find out how much, on average, it costs to run a campaign for your particular constituency. You will also have to consider how much your opponents have spent in the past – to at least try and match them.
Pro-tip: Follow the informal ‘10%’ rule, in which you always try budget expenses 10% higher than you think it will be. This gives you flexibility for last minute changes, or sudden new bills.
Most expenses vary depending on location. To ensure the utmost accuracy in your budget, focus your research on local data.
For example, the rent for a ‘campaign HQ’ may just be too much in your area, so you need to get creative about your offices. Or, maybe it is best to have your posters printed in some other village you will visit for campaigning, rather than your own home town where costs may be higher.
To make it easier, you can use a sample budget sheet, where you will feed in your various expenses and see how the budget works out.
Sample budget: Download a comprehensive campaign budget template here
Create three different budgets
Ideally, you should create three budgets and see how much money each requires. The three budgets are:
- All the money in the world version: What kind of campaign would you run if you had all the money you wished for?
- The “just right” version: What is the ‘realistic’ amount of money you can raise and spend for this campaign?
- Bare minimum version: What is the least amount of money with which you can pull this off?
Since you spend what you raise, such multi-budget options will help you plan for any amount of funds you get. Of course, it would be bad if you had to run with the third version, but you need to be prepared for it.
Read More: 4 Cost-Effective Political Canvassing Techniques For Your Next Campaign
Multi-budgets also help you change your spending on the fly, as the situation requires, without you having to stop the campaign to re-calculate everything.
Plan fundraising strategies to align with your budget
Before you begin to spend all your time raising money to meet your budget, a small, but often overlooked, step of planning is using your networks to get donations. How many venues can someone donate for you to use free-of-charge? How about volunteers as staff? Or are there any friendly publishers who will give you a discount on ads?
Make a list, and call in some favors first. The more, the better. And then make your plan to raise the funds. Remember – you must still raise the same amount you had budgeted for. Because sometimes favors can be revoked and that will leave you hanging.
Save money – but be prepared for the first.
Read More: How To Ensure Successful Fundraising Event Planning- Template Included!
Important: Even such favors are considered ‘in-kind contributions’, and you’ll have to report them along with your monetary donations in your campaign filings. Make sure you study the federal requirements here.
Once you have minimized costs as much as possible, figure out your ‘burn rate’. What this means is –
- How many days to the election?
- How much is the total cost till the day of the election (and beyond)?
- How much does that work out on a per-day basis?
Once you have the number, you can decide how many fundraising events you need to hold, and the amounts you need to raise from each event. Remember your options for fundraising include:
- fundraising events,
- ‘text-to-give’ campaigns,
- direct calling to voters and even
- ‘peer-to-peer’ conversations with donors and voters.
Of course, you will have spikes and dips in donations depending on electoral fortunes – but if you plan for a steady rate, you can tide over the ebbs and flows.
Political campaign expenditures
Political expenses are, by their very nature, a loosely defined unit. However, there are broad categories in which most expenses can be sorted. Some may seem obvious, while others are unique to political campaigns.
Though you may not have a need or be able to afford all of the members mentioned here, this list below is a non-exhaustive guide to give you the gist of the personnel and resources your political campaign expenditures will encompass:
Media
- TV spots
- Cable spots
- Radio (Metro, Rural, Other)
- Print advertising
- TV/ Radio production
- Digital (ads, GOTV, social media)
- Website (hosting, design)
- Commission
Polling
- Focus groups
- Polling
- Ad testing
Press
- Research (opposition/self)
- Press coverage tracking
- Press events
- Subscriptions
Fundraising
- Events (national, in-state)
- Catering
- Event space rentals
- Post (mail, email)
- Printing
- Call Centre
- Travel
- Software
- Paid acquisition
- Consulting
Staff
- Campaign (Manager, Deputy Campaign Managers)
- Finance (Director, Deputy Finance Directors, Assistants)
- Political (Director, Deputy Political Directors)
- Communications (Director, Press Secretary, Digital, Assistants)
- Research (Director, Deputy Research Directors, Media Monitors)
- On Field (Directors, Deputy Field Directors, Organizers)
- Compliance (Operations Director, Assistants)
- Volunteer (Managers)
- Payroll Services (Accountants, HR, etc.)
Remember – while the above expenses are almost universally needed in any campaign, you must maintain a low ‘burn rate’ for your cash. So, try to reduce expenditure as much as possible in the actual spending while planning for most of these positions.
Federal laws about political campaign donations
Campaigns raise funds from individuals, political party committees, and political action committees (PACs).
Individual contributions to federal candidates, parties, and PACs are subject to various limits. For example, individuals can contribute up to $2,900 per election to a federal candidate and $5,000 to a PAC.
There are different types of PACs, including connected PACs (affiliated with corporations, unions, or interest groups) and non-connected PACs (not affiliated with corporations, unions, or interest groups).
Read More: The ABCs of Political Donations: Tax, Tracking, and Limits
Federal law prohibits certain entities, such as corporations and foreign nationals, from making direct contributions to federal candidates or parties.
Here are some laws and bodies governing all of this:
Federal Election Campaign Act (FECA)
The FECA is the primary federal law regulating political campaign contributions and expenditures. It establishes contribution limits for individuals, political action committees (PACs), and political parties. The 1971 Act also created the FEC, the agency that enforces federal campaign finance law.
Federal Election Commission (FEC)
The FEC is an independent regulatory agency responsible for administering and enforcing federal campaign finance laws. It sets the guidelines and regulations for campaign contributions and expenditures. So they are crucial to your political campaign budget.
Candidates, parties, and PACs must disclose their contributions and expenditures regularly to the FEC. This information is made available to the public.
Interestingly, there are six FEC commissioners in total and it requires four to make a decision. Crucially, according to the law, no more than three can be from the same political party.
Bipartisan Campaign Reform Act (BCRA)
Before the BCRA amendments, the Federal Election Campaign Act of 1971 placed limitations on ‘hard money’ donations – funds specifically contributed to individual candidates.
However, it had no restrictions on ‘soft money’ contributions – money given for general “party building” rather than a specific political candidate. The BCRA aimed to eliminate the soft money loophole by prohibiting such contributions in federal elections.
Being cost-effective, making the most of your contacts, and being smart with your spends and discounts can go a long way. It takes just one viral moment, one good debate or even one stumble by the opposition for your campaign to be put front and center.
And when the time comes, let your spotlight not fade because you couldn’t pay the power bills (metaphorically, of course). Plan well, and fight hard. All the best for your political campaign budget.
You can have a look at more political campaign fundraising articles here:
- A Guide To Write The Best Fundraising Communications Plan
- Fundraising Websites 101: A Guide To Get You Started Now
- How to Start a Fundraiser: This is Your Guide to Raise Money
