FEDERAL ELECTION COMMISSION 

Washington, DC 

MEMORANDUM

TO:

FROM:

DATE:

SUBJECT: 

The Commission 

Office of the Commission Secretary VFV

February 12, 2024

AOR 2024-02 (Waters) – Comment on Drafts A and B

Attached is a comment received on Advisory Opinion Request 2024-02.

Attachment
SANDLER REIFF 1090 Vermont Ave NW, Suite 750

Washington, DC 20005

www.sandlerreiff.com

T: 202-479-1111

F: 202-479-1115

SANDLER REIFF LAMB

ROSENSTEIN & BIRKENSTOCK, P.C.

1

February 9, 2024

Lisa J. Stevenson, Esq.

Acting General Counsel

Federal Election Commission

Office of General Counsel

1050 First Street, NE

Washington, DC 20463

ao@fec.gov

COMMENT ON ADVISORY OPINION 2024-02

(WATERS) DRAFTS A&B

Ms. Stevenson:

I write to provide my thoughts on Drafts A & B in the above referenced Advisory 

Opinion Request. The opinions stated herein are my own and do not reflect the opinion of any 

firm client or other attorney in my office. Rather, they stem from my keen interest in 

Commission actions related the Bipartisan Campaign Reform Act (“BCRA”), for which I have 

advised clients since its passage in 2002 and my desire to assist the Commission in its 

deliberations related to this Request. I commend the Commission for tackling such a thorny 

issue of likely first impression on such an expedited basis.

As a threshold matter, I believe that each draft may start from the wrong analytical 

framework. Each draft concludes that direct mail communications disseminated by Citizens for 

Waters (“Waters Committee”) qualify as a “federal election activity” and thus, the analysis in 

each draft flows from this assumption.1 While my analysis below may not lead to a desired 

normative conclusion, I believe there is a highly plausible alternative legal approach to the

BCRA as it pertains to this Request. Although each draft properly cites the rule defining 

“federal election activity” there is a plausible argument that it incorrectly applies the scope of the

provision. It is my belief that the concept of “federal election activity” was not intended to be 

applicable to communications disseminated directly by and paid for by an authorized committee 

of a federal candidate. Unlike the definition of “contribution” and “expenditure”, the definition 

of “federal election activity” was created solely to define activities undertaken by a specific 

universe of groups. Specifically, activities undertaken directly by a state or local political party 

1 In addition, I would like to point out that the requestor described their mailings as “brochures,” and this term is 

used throughout both drafts. As you know, the term “brochure” is described elsewhere by the Commission as a

grassroots item that is exempt from the definition of “federal election activity.” 11 C.F.R. § 100.24(c)(4); see also, 

11 C.F.R. §§ 100.87; 100.147; To avoid confusion between grassroots exempt brochures and direct mail 

communications, I would suggest adding an explanation that the use of the term “brochure” in the draft should not 

be given the same meaning as is used elsewhere in Commission regulations. 
2

committees and, in certain circumstances, activities undertaken by other outside non-party, nonfederal groups and candidates.

2

 It is my understanding and belief that the purpose of the

inclusion of “federal election activities” in Section 30125(e)(1)(A) was intended to clarify that 

donations that were solicited by a federal candidate or officeholder to a state or local party 

committee’s non-federal account were not eligible to be used in connection with a “federal 

election activity.” Stated another way, a state or local party committee could not use non-federal 

funds solicited, transferred, or otherwise “bundled” by a federal candidate or officeholder, as 

“Levin Funds.”3

Furthermore, it is unnecessary to apply the “federal election activity” language found in 

section 30125(e)(1)(a) to communications paid for directly by a candidate from their own 

campaign funds as such activities are already covered by other provisions of the Act, including

an earlier portion of the same sub-section of the statute that requires that all contributions and 

disbursements “in connection with a Federal office” must derive from funds that comply with the 

prohibitions, limitations and reporting requirements of the Act. To be sure, all contributions 

received into the account of an authorized committee of a candidate must comply with all three 

of these requirements. Thus, as a matter of statutory construction, I believe there is a plausible 

argument that the application of “federal election activities” as used in section 30125(e)(1) is 

superfluous and redundant as applied to the facts in this Request and that this language was not 

intended to cover communications paid for directly by the authorized committee of a federal 

candidate. Indeed, the title of Section 30125 is “Soft money of political parties” further 

emphasizing that the section applies primarily to the raising and spending of money by party 

committees. Rather, the concept of “federal election activities” was introduced in the BCRA to 

prevent the circumvention of the law by the direct spending of non-regulated funds by 

organizations, parties and state and local candidates in connection with federal elections.

Draft B identifies a separate provision of the BCRA that could be applicable to 

the activity described in the Request. Specifically, the BCRA requires that the payment 

by a state or local candidate that disseminates a “public communication that “promotes, 

supports, attacks or opposes” a federal candidate must derive from funds that meet the 

limitations, prohibitions and reporting requirements of the Act.4

 However, it is not clear 

whether this provision is applicable to this Request since each state or local candidate 

would not be directly disseminating the communication and would only be reimbursing 

the Waters Committee for a pro-rata share of the communication that references their 

own campaign, Therefore, the non-federal candidates would not be paying for, or 

otherwise subsidizing, any portion of the communication that references a federal 

candidate. Nevertheless, based upon the above analysis, it is my belief that there is a 

plausible argument that this provision would not apply to this Request because the 

underlying “federal election activity” rules do not apply to the mailing being undertaken 

by the Waters Committee.

2 52 U.S.C. § 30101(b)(2) (regulating how state and local party committees may engage in “federal election 

activities”); 52 U.S.C § 30125(4)(B) (restricting certain solicitations by a federal candidate or officeholder to groups 

that engage in certain “federal election activities”). 3 52 U.S.C. § 30125(b)(2)(C); 11 C.F.R. § 300.31(e). 4 52 U.S.C. § 30125(f)(1).
3

Based upon the analysis above, I believe that a better framework to properly analyze this 

request would be to apply the same analysis as Advisory Opinion 2004-37. In Advisory Opinion

2004-37, the Commission advised Congresswoman Waters that she could include federal 

candidates in similar mailings and that the pro-rata payment by other federal candidates would 

not be considered a “contribution” by the reimbursing committee as long as the committee only 

paid for their pro-rata share of the communication. Applying the same analysis to the facts in 

this request, each non-federal committee who provided funds for their pro-rata share of a mailing 

would not make a “contribution” to the Waters committee.

Assuming arguendo that Sections 30125(e)(1) or (f)(1) are applicable to the 

activities contemplated by the Waters Committee, I have a few comments related to the 

discussion of federal reporting requirements in Draft B. First, the Draft concludes that 

the payments are not permissible because “the Requestors do not represent that the funds 

solicited and received from non-federal sources will have been reported to the 

Commission.”5 To the extent that Draft B has enough support to issue an opinion, rather 

than ascribe the requestor with a presumptive negative conclusion, the Commission 

should go back to the requestor and seek clarification on this point. If so instructed, the 

Waters Committee can develop a procedure to require the reimbursing committee to 

comply with Section 30125(f)(1) which would allow the Commission to provide the 

requestor with an affirmative conclusion.

6

 

Second, it would be useful to include a discussion in Draft B as to what it means 

to be in compliance with the reporting requirements of the Act. For example, if a state or 

local candidate’s portion of a mailing does not exceed $1,000 (assuming they have not 

made any other disbursements related to Federal elections), it appears to me that no 

triggering event to comply with the Act would occur since the candidate did not reach the 

$1,000 threshold for registration as a federal political committee.7

Third, I have concerns as to the failure of Draft B to address the “major purpose” 

test as it relates to the facts in this matter. The “major purpose” test is a constitutionally 

mandated exemption such that the Act’s reporting requirements (for those organizations 

that trigger political committee status under the Act) only apply to organizations under 

the control of federal candidates or whose major purpose is engaging Federal campaign 

5 Draft B at p.9.

6 Notwithstanding, if the Draft B has sufficient support of the Commission, I do not believe that it should be 

incumbent on the Federal candidate to enforce compliance with Section 30125(f)(1) and the fact as to whether the 

Waters Committee does or does not have a policy to require compliance with the reporting requirements should be 

immaterial to the consideration of their Request.

7 52 U.S.C. § 30101(4). Since the requestor is a federal candidate, I suppose this Opinion would not be the proper 

forum to discuss the actual reporting requirements that apply to the reimbursing committee. That said, the 

Commission must consider the practical implications of those requirements. Surely those committees should not be 

required to disclose all receipts and disbursements made by the committee in connection with their state or local 

election if the reimbursement is made directly from a state campaign committee? Would they be required to 

establish a separate bank account and committee to comply with Sections 30125(e) or (f)? With the exception of 

Advisory Opinion 2018-07, these are questions that the Commission has not (to my knowledge) addressed since the 

passage of the BCRA. Any guidance on this point in the Commission’s response would be useful to the regulated 

community if Draft B has the support of a sufficient number of Commissioners.
4

activity.

8

 Presumably, the payments made by the non-federal organizations or candidates

to reimburse the Waters Committee will constitute a relatively small portion of the 

organization’s or candidate’s political spending. Assuming this is the case, my belief is 

that the Commission would be prohibited from requiring the non-federal candidates or

committees to register as political committees with the Commission and thus

constitutionally nullifying the statutory requirement that the reimbursements or 

underlying contributions to the non-federal committees must comply with the reporting 

requirements of the Act.9

Finally, I would like to provide my thoughts regarding a question raised, but not 

answered, by Commissioner Weintraub during Thursday’s hearing regarding the Draft 

Opinions. Commissioner Weintraub posed the question as to whether reimbursements to 

the Waters Committee would be subject to the prohibitions and limitations of the Act. 

For purposes of this Request, the issue has been mooted by the representations of the 

Waters Committee that they would not accept any reimbursements from a state or local 

candidate unless the funds used for such reimbursements meet the prohibitions and 

limitations of the Act. That said, if the Commission applies the analysis of Advisory 

Opinion 2004-37 (concluding that reimbursements were not contributions) and not the 

analysis provided for in either Draft Opinion, the answer to this question could be found 

in Advisory Opinion 2002-14. In this Opinion, the Commission opined that the sale of a 

list by a national party (subsequent to the enactment of the BCRA) at fair market value 

was not a contribution to the national party committee. Consequently, the Commission 

found that the revenue realized by the national party committee would not be subject to 

the prohibitions and limitations of the Act.10 Under the framework of Advisory Opinion 

2004-37, the answer to this question therefore would be consistent with that of AO 2002-

14 since the national party committee was likewise prohibited from accepting any 

contributions that did not meet the limitations, prohibitions and reporting requirements of 

the Act at the time of the Request.11 Thus, an argument can be made that the 

reimbursements would not be subject to the prohibitions and limitations of the Act. This 

analysis can be squared with Section 30125(e) because the reimbursements will only 

cover the share of the communication that references only state and local candidates and 

will not subsidize any speech directly in connection with a Federal election.

8 Buckley v. Valeo, 424 U.S. 1, 79 (1976). 9 I have briefly reviewed McConnell v. FEC and I could not locate any discussion of the applicability of the “major 

purpose” test to either Sections 30125(e) or (f). 10 FEC Advisory Opinion 2002-14, p.p. 4-5. 11 See 52 U.S.C. §30125(a). Notwithstanding the analysis in this paragraph, I would concede that a state or local 

party committee likely could not be reimbursed with funds that are not subject to the prohibitions, limitations and 

reporting requirements of the Act since the mailing would be clearly covered by 52 U.S.C. § 30125(b)(1).
5

I hope that my comments have been helpful to your consideration of this Request. If you 

have any questions or need additional information in connection with this comment, I can 

be reached at (202) 479-1111 or reiff@sandlerreiff.com.

Sincerely,

Neil P. Reiff