July 14, 2006
P.O. Box 349
Kaplan, LA 70548-0349
RE: Ethics Board Docket No. 2006-476
Dear Mr. Couvillon:
The Louisiana Board of Ethics, in its capacity as the Supervisory Committee on Campaign Finance Disclosure, at its July 13, 2006 meeting, considered your request for an advisory opinion concerning the contribution limits that apply to limited liability companies, wholly-owned limited liability companies and wholly-owned Subchapter S corporations. You stated that you have a contributor that has an ownership interest in the following five companies: 1) one S corporation, of which he owns 100%; 2) three limited liability companies, of which he owns 50% of each; and, 3) one limited liability company, of which he owns 100%.
The Board concluded, and instructed me to inform you, that the contribution limits in the Campaign Finance Disclosure Act (CFDA) (LSA-R.S. 18:1505.2H) apply per “person,” per election. A “person” is defined in the CFDA as any individual, partnership, limited liability company or corporation, association, labor union, political committee, corporation or other legal entity, including their subsidiaries. The Board concluded that wholly-owned Subchapter S corporations and wholly-owned limited liability companies, because of their tax status and the interests of a stockholder in those legal entities, cannot be distinguished from its individual owner for purposes of contribution limits. Therefore, the contributor’s individual contribution(s) will be aggregated with any contribution made by his wholly-owned Subchapter S corporation and his wholly-owned limited liability company.
However, with respect to the limited liability companies of which he owns 50%, the Board concluded that the contribution made by the contributor and those three limited liability companies do not need to be aggregated for contribution limit purposes. Therefore, the contributor may make a campaign contribution in the maximum amount in his own name and the limited liability companies of which he owns 50% may make contributions subject to the contribution limits set forth in the CFDA.
The Board issues no opinion as to laws other than the Campaign Finance Disclosure Act. If you have any questions, please contact me at (800) 842-6630 or (225)763-8777.
Alesia M. Ardoin
For the Board