The Federal Election Commission has settled a dispute with a political action committee that will allow it to both contribute to federal candidates like a traditional PAC and to take unlimited contributions from corporate, labor or individuals for use in making independent expenditures. 

The consent degree ends a court case, Carey v. FEC, filed after the FEC blocked a 2010 plan by the National Defense PAC to set up a segregated bank account for making independent expendistures. National Defense PAC made modest contributions–just $1,490–to federal candidates that cycle, and had no donors who contributed more than $200. The group decided it also wanted to accept donations in excess of the $5,000 maximum a traditional PAC can accept for making independent expenditures. 

National Defense PAC asked the FEC for an Advisory Opinion regarding its plan. The FEC voted on two draft Advisory Opinions, but neither got enough votes for approval. National Defense PAC then filed its lawsuit. In June, a U.S. District Court granted a preliminary injunction allowing the PAC to proceed with its plan.

On June 20, the National Defense PAC reported spending $10,000 to run an ad opposing Rep. Barney Frank, D-Mass. 

Organizations that register with the FEC as independent expenditure-only committees, also known as Super PACs, state in writing that none of their funds will be used for making contributions to candidates.  

In August, a group called the Efficient America PAC registered as political action committee that intended to operate segregated accounts, one for raising unlimited funds to make independent expenditures, and the other to contribute directly to candidates.