Sen. Kyrsten Sinema isn't running. What happens to the millions donors gave her campaign?

Sen. Kyrsten Sinema begins winding down her congressional career with about $11 million in campaign cash reserves, the largest sum among incumbent lawmakers stepping away from politics in Washington, and she has given no public indication of what she intends to do with the money.

Only former Rep. Devin Nunes, R-Calif., who left office two years ago, has more unspent campaign money, $12.4 million, among those recently in Congress, according to Federal Election Commission records.

Sinema, I-Ariz., had $10.6 million entering January and is expected to file updated figures in the next month. Sinema’s affiliated Getting Stuff Done political action committee had $466,000 in cash entering January and is also one of the best-funded committees among those stepping out of politics. A separate joint fundraising committee, the Sinema Leadership Fund, ended last year with $150.

A Sinema spokeswoman could not say Tuesday how Sinema plans to distribute the unused money.

Campaign finance experts said Sinema has time and options that mean the question could linger.

“It’s very difficult to make predictions in politics these days,” said Ian Vandewalker, senior counsel to the Brennan Center for Justice in New York. “If she wanted this to literally just sit there and earn interest somewhere until she decides years from now to do something, that’s an option.”

“Lately it has been more common for campaign committees to last for a long time, including even when a candidate dies. They slowly get spent down going to charity or donating to other candidates.”

Facing polling that showed her in last place in a three-way race to keep her job and with her fundraising skidding, Sinema announced March 5 that she would not seek a second term in the Senate.

While cash was becoming a problem for Sinema’s potential reelection, the surpluses now for a former candidate become enviable assets.

Sinema could give the money back to her donors, give it to charity or dole it out to other campaigns. The money and whatever Sinema decides to do with it could play out over years.

Whatever her plans, Sinema’s unspent cash stands apart from the 30 others also quitting Congress, at least for the moment. It is an amount that reminds of her once-stellar fundraising ability when she was a Democrat and the hope of a campaign that she might have waged this year.

Money can be used for almost anything except personal use

Experts in campaign finance matters said the only clear prohibition on the money is it can’t be used for herself.

Beyond that, Sinema’s personal and political situation also makes her decision harder to puzzle out.

“She can’t put it into her pension fund or go buy a new house or buy a NetJet,” said Brad Smith, who served as an FEC commissioner from 2000 to 2005. “One of the more common things that see people do is former candidates will endow a center, maybe at their alma mater.

“You didn’t used to see that so much because up until about 1990 they could just pocket the money, any money they had left in their campaign. which was a pretty good deal with a few million bucks left over.”

The late Sen. John McCain, R-Ariz., offers a recent, major example of the creative use of unspent campaign money.

His various political committees ended with surplus funds after his 2008 presidential run and as his Senate career wound down.

In 2012, his presidential campaign effectively donated nearly $9 million to Arizona State University through a McCain-related foundation to help establish the international leadership institute that bears his name.

McCain’s campaign routed the money to the institute even as the Republican National Committee, a potential recipient, had about $11 million in debt and as then-nominee Mitt Romney challenged President Barack Obama.

Catch up: Sen. Kyrsten Sinema won't seek reelection, ending chances of a 3-way Arizona Senate race

McCain wasn't quite done with politics yet, though. He would seek and win a sixth and final Senate term in 2016, dying in office in 2018.

Political parties, candidates an option for unspent money

Among the options for any former candidate is to simply give the money to a political party. Those types of transfers are not limited, but it seems a less likely choice for Sinema.

She quit the Democratic Party in 2022 and didn’t use the occasion to join the Republicans or any other party in the months since.

Sinema could make campaign contributions to other candidates or causes, but those are subject to the customary legal limits, meaning it could take years to spend millions, which can continue to accrue interest throughout.

Former Sen. Robert Torricelli, D-N.J., quit in 2002 after the Senate noted it was “severely admonishing” him for accepting undisclosed gifts. He unloaded part of his $2.9 million in unspent money over years to a variety of political recipients and included organizations with ties to businesses dealing with Torricelli.

“That kept him with some influence in New Jersey that I think he liked,” said Smith, who is now a law professor at Capital University in Columbus, Ohio.

Refunds to donors are possible but unlikely

Sinema could refund the money to the donors who provided it. That is rare, experts said.

“I’ve seen that done,” Smith said, “but it’s usually for people with a lot less money. … There’s no real clear way to do that and the administrative cost would eat up a huge amount.”

Vandewalker agreed.

“This campaign probably has many thousands of donors. Logistically, it’s just very challenging. You would have to come up with some pro-rata rule of who gets what first. You’d have to cut a lot of checks. It would be difficult. And it’s easy to make the case that the donors don’t expect that.”

Sinema’s campaign refunded $266,000 in donations before announcing she would not run again. That is among the higher totals among Senate campaign committees, though isn’t close to the most.

Sen. Joe Manchin, D-W.Va., who also isn’t running for reelection, refunded nearly $3 million by the end of last year.

Rep. Ruben Gallego, D-Ariz., who is challenging for her seat, refunded $185,000 by the end of last year.

Politicians can give unspent campaign money to charity

Candidates can give their unspent money to charity, something Sinema has done on a limited basis before.

In 2017, she gave the Arizona Coalition to End Sexual and Domestic Violence about $53,000 her campaign had received from employees and family members of Backpage.com.

At the time, the donations became a toxic liability because the website’s owners were accused of knowingly accepting ads offering sex with underage girls.

Last year, a federal jury convicted three executives with Backpage.com of promoting prostitution and money laundering. The government described their business as “the internet’s leading forum for prostitution ads from September 2010, when Craigslist shut down its prostitution ad section, until April 2018, when the United States seized Backpage.com.”

Can Sinema keep spending campaign money on security expenses?

One of the more notable expenses Sinema has incurred in recent years involves her personal security. That’s allowed under the FEC’s rules and something others, such as her seatmate, Sen. Mark Kelly, D-Ariz., do as well.

But it’s not clear that she can continue to do so.

Vandewalker called continued security spending an “interesting” question.

“In the case of a candidate, that’s allowed,” he said. “In principle, I would say if a person is not a candidate, then personal security is not a campaign expense, and, therefore, that starts to look like personal use. I’m not sure there are any bright-line rules.”

Sinema long ago filed procedural paperwork with the FEC formally keeping her a candidate. But her statement earlier this month publicly closed the door to another run.

“I believe in my approach,” she said of her collaborative legislating style during her retirement announcement, “but it’s not what America wants right now.”

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Vandewalker presumes the FEC would take its cues from her public remarks.

Smith said Sinema could seek an advisory opinion on the matter.

“Someone like Kyrsten Sinema might say, ‘Look, I’ve had people hounding me for years. They’ve barged into the bathroom chasing me,’” he said, alluding to a 2021 incident at Arizona State University involving activists confronting Sinema. “There’s no clear rule.

“That is one where I know if I were still on the commission, having been one of the hard-asses on personal use, I would be pretty sympathetic to that request.”

‘Wild West’ for another money source

One other area where Sinema’s political money raises questions is with her leadership PAC, known as Getting Stuff Done PAC.

Leadership committees have looser spending guidelines than a regular campaign committee and don’t have to advance a candidate, Vandewalker said.

“It doesn’t have to be used to run for office. There are things that you could do that might start to look like a personal benefit, like going on a fancy junket to another country, where it starts to look a lot more like tourism than a campaign trip.

“That would be an example of something a leadership PAC can spend money on that a campaign committee can’t. People talk about leadership PACs being sort of the Wild West.”

They are, however, subject to customary transfer limits that would mean Sinema couldn’t just move $10 million into that fund and spend as she sees fit.

Entering 2024, Sinema’s leadership PAC had $466,000.

Here's why Sinema’s cash total stands out

As Sinema is bowing out, her campaign’s cash total is notably large for someone leaving office.

Seven other senators are leaving after the current Congress ends its business in early January. Their campaigns and affiliated PACs had cash totals ranging from $9.8 million for Manchin, who has flirted with a presidential run this year, to $282,000 for Sen. Tom Carper, D-Del., who is retiring at 77 after four terms in the Senate.

Sen. Laphonza Butler, D-Calif., was appointed to her seat after the death last year of Sen. Dianne Feinstein, D-Calif. Butler is not running to replace Feinstein and has no campaign funds.

Retiring Rep. Debbie Lesko, R-Ariz., had $750,000 in unspent campaign cash at the end of last year. That puts her in the middle of House members who aren’t seeking another term. She also had another $4,300 in an affiliated leadership PAC.

Rep. Mike Gallagher, R-Colo., who announced his near-term resignation on Friday, had $4 million in cash in December, the most among retiring House members.

Before quitting, cash was a problem for Sinema

Sinema’s campaign struggled to raise money almost immediately after she quit the Democratic Party in December 2022.

In the final three months of 2022, most of which she was still known as a Democrat, Sinema outraised Sen. Sherrod Brown, D-Ohio. Like Sinema, Brown always figured to face a competitive race in 2024. Sinema took in $804,000 in late 2022. Brown collected $618,000.

In the first three months of 2023, when Sinema was newly an independent, she raised $2.1 million. Brown raised $3.6 million, a disparity that grew throughout 2023.

By the final quarter last year, Brown pulled in $6.6 million while Sinema, who was publicly uncommitted to another run, raised just $595,000. Brown ended 2023 with more than $14 million in cash and Sinema finished with $10.6 million in cash.

A slowdown in fundraising always loomed larger for Sinema than it did for her challengers. Running as an independent, she couldn’t count on or coordinate major infusions of additional funding in a race that will draw hundreds of millions in spending.

By contrast, Gallego and the Republican nominee figure to inherit the money their parties and their allies will pour into the Senate race. Former TV broadcaster Kari Lake and Pinal County Sheriff Mark Lamb are competing for the GOP nomination.

The costs of running in Arizona’s U.S. Senate races have skyrocketed since McCain won his sixth term in 2016. That year, all expenses for the candidates and outside groups totaled about $32 million.

In 2022, when Kelly won reelection, spending from the candidates and outside groups topped $309 million.

This article originally appeared on Arizona Republic: What can Sen. Kyrsten Sinema do with the millions in unspent funds?