NASHVILLE -- Future candidates in Tennessee would face limits on how much they can personally "loan" their campaigns under a bill that passed the House on a 75-12 vote this morning.
The bill, aimed at wealthy candidates, limits to $100,000 per election the amount of money a candidate for state or local office may personally loan to the campaign. That includes loans the candidate obtains from a financial institution.
Candidates also could no longer charge their campaigns interests on loans up to $100,000.
The legislation says it has no impact on a candidate's ability to spend as much money as he or she likes in the campaign. That's a nod to prior U.S. Supreme Court rulings which permit candidates to spend unlimited amounts of their own money when running for office.
But in focusing on "loans," the bill strikes at an advantage that wealthy candidates, including millionaires, have long exercised in Tennessee. The candidate "loans" the money to the campaign. Once in office, the candidate often uses future campaign contributions to repay the loan, sometimes with interest.
"They may have to think twice about putting millions in because they would not get it back," said Rep. Bill Dunn, R-Knoxville, the measure's sponsor.
But several Republican and as well as Democratic lawmakers objected, saying they feared the bill would harm their ability to seek bank loans above $100,000 to fend off millionaire candidates still able to simply contribute the money outright to their own campaigns.
Two Republicans pointed out that a wealthy candidate could still simply refund his or her own contribution after the campaign. Dunn acknowledged that would be a possibility, but he said it would violate the spirt of the law and the public would know that.
Sen. Mike Bell, R-Riceville, is sponsoring the Senate version.
The bill does not become effective until after the Nov. 4, 2014, election.
Andy Sher is a Nashville-based staff writer covering Tennessee state government and politics for the Times Free Press. A Washington correspondent from 1999-2005 for the Times Free Press, Andy previously headed up state Capitol coverage for The Chattanooga Times, worked as a state Capitol reporter for The Nashville Banner and was a contributor to The Tennessee Journal, among other publications. Andy worked for 17 years at The Chattanooga Times covering police, health care, county government, ...