December 2005 Federal Election Commission Volume 31, Number 12

Table of Contents

(continued on page 6) (continued on page 2)

Shays Rehearing Denied; 

Rulemakings Expedited

On October 21, the U.S. Court of 

Appeals for the D.C. Circuit declined to rehear en banc the Commission’s appeal of an earlier D.C. 

Circuit decision in Shays v. FEC that 

upheld a district court remand of 

several of the Commission’s regulations. (See the September 2005 

Record, page 1.) In response, the 

Commission has announced that 

it is moving forward aggressively 

to complete action on the affected 

regulations.

At the Commission’s November 3 

open meeting, FEC Chairman Scott 

Thomas and Vice-Chairman Michael 

Toner said the agency is committed 

to completing action on all of the 

affected regulations by the end of 

February 2006. To accomplish that 

task, the Commission has scheduled 

two additional open meetings before 

the end of this year, and expects to 

meet frequently during January and 

February. 

The Commission began work 

on the affected regulations shortly 

after the district court’s decision in 

September 2004. Chairman Thomas 

noted: “We, in fact, already have accomplished a good deal of the work 

needed on the 15 regulation topics 

at issue. The Commission has held 

Court Cases Advisory

Opinions

AO 2005-13

Nonconnected PAC’s

Allocation of Expenses and 

Treatment of Solicitation 

Proceeds as Contributions 

EMILY’s List, a nonconnected 

federal political action committee 

(PAC), must use federal funds to pay 

for at least half of its administrative 

and generic voter drive expenses, 

and communications that refer to 

a political party. Communications 

that refer to a clearly identified 

federal candidate must be financed 

exclusively with federal funds. In 

addition, EMILY’s List must treat as 

federal contributions the proceeds 

of any communication that indicates 

a portion of the funds received will 

be used to support the election of a 

clearly identified federal candidate.

Allocation of Administrative and 

Generic Voter Drive Expenses

EMILY’s List is a nonconnected 

PAC active in both federal and nonfederal elections. During the 2006 

election cycle, EMILY’s List plans 

to spend 65 percent of its “candidate 

budget” on nonfederal candidates. 

These expenses include, among 

other things, in-kind donations, 

polling, get-out-the-vote programs, 

 Court Cases

 1 Shays v. FEC

 6 CREW v. FEC (04-1672)

 1 Advisory Opinions

 Regulations

 6 Public Hearing on Electioneering 

Communications

 7 Definition of “Solicit” and “Direct”

 9 Final Rules on De Minimis

Exemption for Levin Disbursements

 9 Alternative Dispute Resolution

 11 Administrative Fines

 Compliance

 12 Union Contributions; Contributions 

in the Name of Another

 13 Excessive and Prohibited 

Contributions, Reporting Errors

 Outreach

 14 Tampa Regional Conference

 15 Reporting and E-Filing 

Roundtables

 15 Index
Federal Election Commission RECORD December 2005

2

Federal Election Commission

999 E Street, NW

Washington, DC 20463

800/424-9530

202/694-1100

202/501-3413 (FEC Faxline)

202/219-3336 (TDD for the

 hearing impaired)

Scott E. Thomas, Chairman

Michael E. Toner, Vice Chairman

David M. Mason, Commissioner

Danny L. McDonald, 

 Commissioner

Ellen L. Weintraub, Commissioner

James A. Pehrkon, Staff Director

Lawrence H. Norton, General

 Counsel

Published by the Information

 Division

Greg J. Scott, Assistant Staff

 Director

Carlin Bunch, Editor

http://www.fec.gov

Advisory Opinions

(continued from page 1)

fundraising and broadcast communications.

Commission regulations require 

nonconnected federal political committees to pay administrative and 

generic voter drive expenses with 

a minimum of 50 percent federal 

funds. 11 CFR 106.6(b)(1)(i), (b)(1) 

(iii) and (c). This allocation minimum recognizes that nonconnected 

PACs can be “dual purpose,” engaging in both federal and nonfederal 

election activity, but requires them to 

use the 50 percent federal minimum 

regardless of their activity. Therefore, even if EMILY’s List spends 65 

percent of its budget on nonfederal 

candidates, it must pay for at least 

half of its administrative and generic 

voter drive expenses with federal 

funds.

Allocation of Expenses for Public 

Communications

Public communication that refers 

to a clearly identified federal candiThe communication will not be 

broadcast on radio or television.

Commission regulations require 

nonconnected PACs to pay for 

public communications that refer 

to a political party, but do not refer 

to any candidates, with at least 

50 percent federal funds. 11 CFR 

106.6(b)(1)(iv) and (c). In promulgating these rules, the Commission 

noted that references solely to a political party inherently influence both 

federal and nonfederal elections, and 

applying the 50 percent minimum 

federal funds requirement reflects 

the “dual nature” of the communication. Therefore, EMILY’s List must 

use federal funds to finance at least 

half the cost of its public communication referring to “Democrats.” 

The result would not change even 

if EMILY’s List otherwise supports 

only nonfederal candidates in the 

state where the public communication is distributed. Commission 

regulations apply to public communications based upon the content of 

the communication, without regard 

to other activities of the person making the communication. 

Treatment of Solicitation Proceeds 

as Contributions

Commission regulations treat as 

federal contributions any funds donated in response to a communication that indicates the funds received 

will be used to support or oppose 

the election of a clearly identified 

federal candidate. 11 CFR 100.57(a). 

As federal contributions, the funds 

must comply with the Act’s limits 

and prohibitions, and also count toward the recipient’s $1,000 political 

committee registration threshold. 11 

CFR 100.5(a).

EMILY’s List provided excerpts 

from three fundraising letters it 

plans to send that feature a federal 

candidate—Senator Stabenow—but 

do not reference any other clearly 

identified federal candidates. Each 

of the three excerpts indicates that 

the funds EMILY’s List receives 

in response will be used to support 

date. EMILY’s List plans to make a 

public communication this election 

cycle in support of state legislative 

candidates. The communication 

will refer to a federal officeholder, 

Senator Debbie Stabenow, who 

represents Michigan in the US Senate, and is also up for re-election in 

2006, and will feature a discussion 

of the Senator’s experiences earlier 

in her career as a candidate for state 

office. The communication will not 

be distributed in the Senator’s home 

state of Michigan, nor will it make 

reference the Senator’s candidacy 

for re-election or solicit funds for 

her campaign. 

Commission regulations require 

nonconnected PACs to pay the 

costs of a public communication 

that refers to a clearly identified 

federal candidate, but does not refer 

to any nonfederal candidate, with 

100 percent federal funds, regardless of whether the communication 

references a political party. 11 CFR 

106.6(b)(2)(ii) and (f)(1)(i). Since 

EMILY’s List’s proposed communication references a clearly identified 

federal candidate, it must be paid for 

with federal funds.

The Commission noted that 

its analysis of the proposed communication would not change if 

a candidate for election in a year 

other than 2006 were substituted 

for Senator Stabenow. The Federal 

Election Campaign Act (the Act) 

and Commission regulations define 

a candidate as an individual seeking nomination for election, or 

election, to federal office and, who 

has received contributions or made 

expenditures aggregating in excess 

of $5,000. See 2 U.S.C. 431(2)(A); 

11 CFR 100.3(a)(1). Neither the Act 

nor regulations distinguish between 

candidates based on election date.

Public communication that refers 

to a political party. EMILY’s List 

also plans to make a public communication in support of state legislative initiatives and referenda that 

will refer to “Democrats,” but not to 

any federal or nonfederal candidate. 
December 2005 Federal Election Commission RECORD 

3

candidates and implicitly to support 

their election to office. However, in 

evaluating the sample text, the determination as to whether the proceeds 

must be considered contributions, 

and as such comply with the amount 

limitations, source prohibitions and 

reporting requirements of the Act, 

depends upon whether the communication indicates that Senator 

Stabenow is among those supported 

candidates.

In two of the three excerpts, 

Senator Stabenow indicates some 

of the funds raised would be used 

to support her re-election. 1 As such, 

all of the funds received in response 

to those communications must be 

treated as federal contributions to 

EMILY’s List. In contrast, the third 

excerpt indicates that the funds collected would be used on behalf of 

women seeking state office, which 

would not include Senator Stabenow 

as a federal candidate. As such, any 

of the funds received in response to 

that communication may be considered donations to the EMILY’s List 

nonfederal account. 

Date Issued: October 20, 2005; 

Length: 7 pages

 —Elizabeth Kurland

1

 The statements of support for Senator 

Stabenow include, “support candidates, 

who like me, could never succeed as 

women in politics,” and “I [Senator 

Stabenow] need your help.

AO 2005-14

Affiliation of Regional Trade 

Associations Composed of 

Franchisee-Members

The Association of Kentucky 

Fried Chicken Franchisees, Inc. 

(AKFCF) is a federation of trade 

associations that is affiliated with regional trade associations composed 

of Kentucky Fried Chicken (KFC) 

franchisees. As a result of that affiliation, AKFCF may solicit contributions to its separate segregated fund 

(AKFCF PAC) from the owners and 

executive personnel of incorporated 

1

 The request stated that members of 

the international regional associations 

would not be solicited for contributions 

to AFKCF PAC.

franchisee-members of the domestic 

regional trade associations, as well 

as the individuals and unincorporated franchisees that are members 

of those regional associations.

Background

AKFCF is an incorporated nonprofit trade association. Its membership is composed of ten separately 

incorporated regional associations 

(seven domestic and three international)1

, the members of which are 

KFC franchisees. Under the bylaws 

of AKFCF and its domestic regional 

associations, franchisee-members 

select regional leaders who comprise 

the majority of AKFCF’s highest 

governing body. AKFCF’s bylaws 

further specify that its principal officers must be past or current officers 

of one of the regional associations. 

Federation Status and Affiliation 

The Commission has concluded 

in past advisory opinions that an 

entity is a federation of trade associations when a significant portion 

of its board of directors consists of 

representatives of regional trade associations, and the trade associations 

participate as principal or important 

units in the governance of the federation. See AOs 1998-19, 1995-17 

and 1977-44. Consistent with those 

opinions, the Commission determined that AKFCF is a federation of 

trade associations. 

Additionally, based on facts leading to the conclusion that AKFCF 

is a federation, the regional trade 

associations are considered affiliated 

with AKFCF. Specifically, their relationship with AKFCF meets several 

of the affiliation factors listed in the 

Commission’s regulations, including 

the ability to direct or participate in 

AKFCF’s governance, the overlap in 

directors and officers between AKFCF and its regional associations, 

and the establishment of AKFCF 

by the regional associations. See 11 

CFR 100.5(g)(4). 

Soliciting the Solicitable Class of 

Corporate Members of Regional 

Associations

Under 114.8(g)(1), a federation 

of trade associations may solicit 

PAC contributions from the members of its regional, state or local 

affiliates or members, provided that 

they qualify as affiliated entities (as 

explained above). A trade association or a trade association federation 

(or its PAC) may not solicit contributions from member-corporations 

themselves, but may solicit contributions from the stockholders and 

executive and administrative personnel, and their families, (“solicitable 

class”) of the member-corporations 

that separately and specifically approve the solicitations for a calendar 

year and have not approved a solicitation by any other trade association for that year. 11 CFR 114.8(c). 

Because AKFCF and its regional associations are affiliated, AKFCF and 

its PAC may solicit PAC contributions from the solicitable class of the 

incorporated franchisee-members of 

the domestic regional associations 

that have given AKFCF such prior 

approval on an annual basis. 11 CFR 

114.8(g)(2).2

Soliciting Unincorporated and 

Individual Members of Regional 

Associations

AKFCF and its PAC may also 

solicit unincorporated franchiseemembers for contributions to the 

PAC, and need not obtain prior 

approval to do so. 11 CFR 114.7(a) 

and (c). For members that are unincorporated business entities (e.g., 

partnerships or LLCs that elect tax 

treatment as partnerships and do 

not have publicly-traded shares), 

AKFCF may address its PAC solici2

 The requirements for properly requesting prior approval from a corporate 

member of a trade association are 

described at 11 CFR 114.8(d) and (e). 

(continued on page 4)
Federal Election Commission RECORD December 2005

4

Advisory Opinions

(continued from page 3)

tations to the one or two individuals 

who normally represent the business 

in its dealings with AKFCF or a 

regional association, but the solicitation may ask for contributions only 

from the unincorporated entity itself, 

not from the one or two representatives or from the stockholders or 

executive or administrative personnel of the member. AKFCF may also 

solicit contributions from franchiseemembers who are individuals, and 

the families of those individuals.

AKFCF may also solicit contributions from the executive and administrative personnel (and families) of 

its regional associations. 11 CFR 

114.8(i)(2).

Date Issued: October 20, 2005; 

Length: 8 pages.

 —Dorothy Yeager

AO 2005-15

Termination and 

Reorganization of State 

Party Committee

The Republican State Executive 

Committee of West Virginia may 

terminate and create a new state 

party committee incorporated as 

a non-profit corporation solely to 

limit liability. The Committee may 

terminate only after it has settled its 

outstanding debt or assigned its debt 

to the new incorporated state party 

committee.

Background

The Republican State Executive 

Committee of West Virginia (“the 

Committee”) is a state party committee registered with the Federal Election Commission. The Committee 

plans to terminate and re-establish 

itself as a non-profit corporation that 

would not be subject to the prohibition on contributions and expenditures in connection with federal 

elections. 2 U.S.C. §441b and 11 

CFR §114. In connection with the 

plan, the Committee asked the Commission whether it may:

AO 2005-17 

Membership Organization/

Trade Association Affiliation 

The Red River Valley Sugarbeet 

Growers Association, Inc. (the Association) qualifies as a trade association under Commission regulations, 

and is affiliated with the American 

Crystal Sugar Company (American 

Crystal), a cooperative membership 

organization. As a result, both American Crystal and the Association may 

solicit contributions to American 

Crystal PAC from the stockholders 

and executive and administrative 

personnel (and families thereof) of 

the incorporated members of the 

Association that have given approval 

for such solicitation. 

Background

The Association. The Association 

is a North Dakota non-profit corporation that is tax-exempt as a “labor, 

agricultural, or hulticultural organization” under 2 U.S.C 501(c)(5). Its 

purpose is to advance the interests of 

sugarbeet growers, to address problems of sugarbeet growing, to aid 

members in working with regulatory 

agencies and to assist in the development of policies that are relevant 

to sugarbeet production. The Association is governed by a member-elected board of directors, and 

includes 2,859 individuals, partnerships, corporations, limited liability 

companies, estates and trusts among 

its members. No member, employee 

or officer receives monetary gain 

or profit from the Association’s 

operations, nor may assets, income 

• Create a new state party committee 

incorporated for liability purposes 

(the “incorporated committee”); 

and

• Terminate as a committee and 

transfer funds in its account to the 

new incorporated state party committee.

Incorporating for Liability

Federal law and regulations allow 

a political committee to incorporate 

for liability purposes only without 

being subject to the prohibition on 

corporate contributions and expenditures. 11 CFR 100.5 and 114.12(a). 

Accordingly, the Commission 

determined that the Committee may 

create a new state party committee 

incorporated for liability purposes 

only without being subject to the 

corporate prohibition.

Transfer of Funds and 

Termination

Federal law and regulations permit unlimited transfers of funds between party committees of the same 

political party. 11 CFR 110.3(c)(1). 

Because the Committee and the 

newly established incorporated 

committee would be considered to 

be affiliated party committees, the 

Committee may transfer any remaining funds to the new incorporated 

committee before terminating.

Prior to making such a transfer, 

the Committee must satisfy the 

requirements for termination. The 

Committee must file a termination 

report on FEC Form 3X. In accordance with FEC regulations, a 

committee may not terminate if it 

has outstanding debts or obligations. 

Because the Committee currently 

has outstanding debts, it cannot 

terminate at this time. AO 1994-35. 

Instead, the Committee may assign 

all of its debts to the new incorporated committee, then terminate. In 

this case, the new incorporated committee would report the transferred 

debts on Schedule D of its next FEC 

report. The Commission noted that 

the Committee is not required to 

terminate in order to incorporate for 

liability purposes. 

The Commission expressed no 

opinion regarding the application of 

the Internal Revenue Code or West 

Virginia law to the Committee’s proposal, as those topics are not within 

the Commission’s jurisdiction.

Date Issued: October 20, 2005; 

Length: 5 pages.

 — Gary Mullen
December 2005 Federal Election Commission RECORD 

5

(continued on page 6)

1

 Section 501(c)(6) provides tax exemption for “[b]usiness leagues, chambers 

of commerce [and other organizations]...not organized for profit and no 

part of the net earnings of which inures 

to the benefit of any private shareholder 

or individual.” See 26 CFR 1.501(c)(6).

or profit inure to their benefit. The 

Association does not have its own 

separate segregated fund.

American Crystal. Membership in 

American Crystal is offered to any 

entity or person that:

• Is a sugarbeet farm operator in the 

territory covered by the cooperative;

• Agrees to purchase securities of the 

cooperative and abide by its rules; 

and

• Is approved by American Crystal’s 

board of directors.

The cooperative has 2,873 members that include individuals, corporations and unincorporated entities. 

Each member owns one share of 

common stock in American Crystal and is entitled to cast one vote 

regarding the cooperative’s affairs, 

including the board of directors. No 

one else holds stock in or has voting authority in American Crystal. 

American Crystal has established 

and maintained American Crystal 

PAC as its separate segregated fund 

(SSF). 

Relationship between the Association and American Crystal. The 

Association was formed in 1926 

by growers in the Red River Valley when the American Beet Sugar 

Company (the precursor of American Crystal) established its first 

sugar refinery in the Valley. In 1973, 

under the leadership of the Association, the Association’s members 

founded an agricultural cooperative 

that then purchased and merged with 

the existing American Crystal Sugar 

Company. 

Legal Analysis

Membership/Trade Association 

Status. FEC regulations define the 

term “membership organization” to 

include a cooperative with bylaws 

that provide for members, some 

of whom operate or administer the 

organization. Members include all 

persons who satisfy requirements for 

membership, affirmatively accept the 

invitation to become a member and 

have either significant financial or 

organizational attachment or pay annual membership dues. See 11 CFR 

114.1(e)(1) and (2). Based on the 

representations in the request, the 

Commission determined that American Crystal qualifies as a membership organization.

A trade association is, “...generally a membership organization of 

persons engaging in a similar or related line of commerce, organized to 

promote and improve business conditions in that line of commerce and 

not to engage in a regular business 

of a kind ordinarily carried on for 

profit, and no part of the net earnings of which inures to the benefit of 

any member.” 11 CFR 114.8(a). The 

Explanation and Justification for 11 

CFR 114.8(a) states: “The general 

definition of a trade association is 

based on the treatment in the tax 

code of business associations. See 

Regulation Section 501(c)(6) of the 

Internal Revenue Code of 1954.”1

Based on details provided in the 

request, the Commission determined 

that the Red River Valley Sugarbeet 

Growers Association qualifies as a 

trade association even though it is 

tax exempt under section 501(c)(5), 

rather than under 501(c)(6). 

Affiliation. According to Commission regulations, SSFs that are 

established, financed, maintained 

or controlled by the same corporation, person, or group of persons, 

including any parent or subsidiary 

organization, are affiliated. See 11 

CFR 100.5(g)(2) and 110.3(a)(1)(ii). 

Sponsoring organizations are also 

considered to be affiliated with 

each other when they meet those 

criteria. See 11 CFR 100.5(g)(4) 

and 110.3(a)(3). In the absence of 

per se affiliation as set out in 11 

CFR 100.5(g)(3), the Commission may examine various factors 

in the context of the relationship 

between sponsoring organizations 

to determine whether those entities 

are affiliated. 11 CFR 100.5(g)(4); 

110.3(a)(3). 

The Commission determined 

that the Association and American 

Crystal are affiliated based on the 

following facts:

• The Association played a significant role in the founding of American Crystal.

• The organizations have a 99.5 percent overlap in membership.

• Each organization has the ability to 

exert some control over the governance and personnel of the other 

organization.

• American Crystal collects and 

transmits dues to the Association 

that constitute almost all of the 

Association’s revenue.

PAC Solicitations. A membership 

organization may solicit contributions to an SSF from its own executive and administrative personnel, 

and their families, from members 

who are individuals (and their families), and from unincorporated entities. A trade association may solicit 

contributions to an SSF from that 

same group and from the stockholders and executive and administrative 

personnel (and the families thereof) 

of those incorporated members that 

provide separate and specific approval to the trade association for the 

making of such solicitations during a 

calendar year and have not approved 

a solicitation by any other trade association for that calendar year. 11 

CFR 114.8(c) and (d). 

A corporation, including a membership organization, may solicit 

contributions to its separate segregated fund, from the solicitable class 

of its affiliates. In addition, a corporation that is affiliated with the connected organization of an SSF may 

pay solicitation costs for the SSF or 

perform actual solicitation functions. However, the Commission 
Federal Election Commission RECORD December 2005

6

Regulations

Public Hearing on Proposed 

Rules for “Electioneering 

Communication”

On October 20, 2005, the Commission held a public hearing to 

receive testimony on proposed rules 

regarding “electioneering communications.” The proposed changes 

would modify the definition of “publicly distributed” and the exemptions 

to the definition of “electioneering 

communications,” consistent with 

the U.S. District Court for the District of Columbia’s ruling in Shays v. 

FEC. In that decision the court ruled 

that the regulation limiting electioneering communications to communications publicly distributed “for 

a fee” exceeded the Commission’s 

statutory authority to create exemptions and that the regulation exempting section 501(c)(3) organizations 

was not properly promulgated under 

the Administrative Procedure Act 

(APA). For more information on the 

NPRM see the October 2005 issue 

of the Record, page 6.

Seven witnesses, representing 

election law practitioners, tax law 

practitioners, campaign reform 

groups and section 501(c)(3) organizations testified before the Commission.

Distributed for a Fee

Elizabeth Kingsley, from Harmon, Curran, Spielberg & Eisenberg 

LLP, testified that eliminating “for a 

fee” from the definition of “publicly 

distributed” may limit the ability 

of nonprofit organizations to crehas not addressed in previous AOs 

the ability of a non-trade association 

membership organization to solicit 

contributions to its PAC from the 

owners and personnel of an affiliated trade association’s incorporated 

members. 

Under the affiliation provisions 

of the Act and regulations, contributions made to or by affiliated SSFs 

are considered to have been made to 

or by a single committee, and thus 

such committees share contribution limits. 2 U.S.C. 441a(a)(5); 11 

CFR 100.5(g)(2) and 110.3(a)(1). 

Hence, affiliated SSFs may make 

unlimited transfers of Federally 

permissible funds to each other. 11 

CFR 102.6(a)(1) and 110.3(c)(1). 

Therefore, if the Association were 

to establish its own SSF receiving 

Federally permissible contributions, 

that SSF could transfer such funds 

in an unlimited amount to American 

Crystal PAC, even if such funds 

were derived from contributions by 

persons that could not be solicited 

for contributions to American Crystal PAC under the rules for non-trade 

association membership organization PACs. 

Based upon the principals underlying the affiliation rules, the 

Commission concluded that the 

Association need not take the extra 

step of forming its own SSF. After an incorporated member of the 

Association has granted separate 

and specific written approval to the 

Association under 11 CFR 114.8(c) 

and (d), either American Crystal or 

the Association, or both, may solicit 

contributions to American Crystal 

PAC from that member’s stockholders and executive and administrative 

personnel, and their families. Similarly, either organization or both may 

pay forand perform the solicitation.

Date issued: November 4, 2005; 

Length: 7 pages.

 — Michelle Ryan

Advisory Opinions

(continued from page 5)

Court Cases

(continued from page 1)

hearings on proposals for modifying 12 of the regulations, which has 

moved us to the final stage of the 

process for those rulemakings. We 

appreciate the numerous written 

comments and oral testimony, all of 

which we are carefully evaluating 

in reaching decisions on final rules 

and developing the detailed written 

explanations required by law.”

Additional information regarding 

Commission rulemakings will appear in the Record and on the FEC’s 

web site at http://www.fec.gov/law/

law_rulemakings.shtml.

Citizens for Responsibility 

and Ethics in Washington v. 

FEC (04-1672)

On October 27, 2005, the US 

District Court for the District of 

Columbia granted the parties’ joint 

motion to dismiss this case, which 

challenged the Commission’s refusal 

to provide documents relating to an 

ongoing enforcement matter. 

Citizens for Responsibility and 

Ethics in Washington (CREW) had 

filed a Freedom of Information Act 

(FOIA) request with the FEC in 

2004 seeking access to documents 

concerning the agency’s ongoing 

investigation of Westar Energy, Inc.. 

The Commission denied the request, 

citing the confidentiality provisions of 2 U.S.C. 437g(a)(12(A). 

CREW challenged that decision in 

court, but in May 2005 the district 

court upheld the agency’s response. 

(See the July 2005 Record, page 3.) 

CREW immediately asked the court 

to reconsider.

On August 18, 2005, the FEC 

closed its enforcement case against 

Westar and publicly released the 

documents CREW had sought, 

thereby rendering the request for 

reconsideration moot.

US District Court for the District 

of Columbia, 04-1672 (RMU).

Advisory Opinion Request

AOR 2005-19

Application of electioneering 

communications restrictions to a 

radio talk show that discusses and 

interviews federal candidates. (Emil 

Franzi, October 19, 2005) 
December 2005 Federal Election Commission RECORD 

7

ate Public Service Announcements 

(PSAs). According to Ms. Kingsley, 

the nonprofit organizations that 

produce PSAs cannot control when 

broadcasters air the ads. Under the 

proposed rules, a PSA has the potential to become an “electioneering 

communication” if it is broadcast 

during the 30- or 60-day electioneering communications windows. 

Given that fact, Ms. Kingsley argued 

that the result of the proposed rules 

would be a reduction in officeholders’ ability to promote worthy 

causes through PSAs. She urged the 

Commission to consider an exemption for communications that are 

not distributed for a fee and do not 

promote, attack, support or oppose 

(PASO) a federal candidate. She 

also recommended that the Commission provide some definition of 

PASO to accompany this exemption. 

Exemption for 501(c)(3) 

Organizations

Ms. Kingsley also argued against 

the proposal to repeal the Commission’s current rule exempting 

501(c)(3) organizations from the 

definition of electioneering communications. According to her testimony, most 501(c)(3) organizations 

are concerned about complying with 

IRS laws and are not aware that they 

must comply with FEC regulations. 

Ms. Kingsley said that repealing the 

501(c)(3) exemption would create a “chilling effect,” inhibiting 

501(c)(3) organizations from free 

expression for fear of violating FEC 

laws. 

Karl Sandstrom, representing 

OMB Watch, and Tim Mooney, 

from Alliance for Justice, also urged 

the Commission not to repeal the 

exemption. Mr. Sandstrom and Mr. 

Mooney both emphasized the importance of 501(c)(3) organizations’ 

non-political lobbying abilities. Mr. 

Sandstrom warned that repealing 

the 501(c)(3) exemption would infringe upon the organizations’ First 

Amendment right to petition government through grassroots lobbying. 

Mr. Mooney and Ms. Kingsley 

emphasized that it is already unlawful for 501(c)(3) organizations to 

support or oppose candidates under 

the IRS rules on exempt organizations. The IRS rules, however, do 

allow 501(c)(3) organizations to 

support or oppose legislation.

Donald J. Simon, representing 

Democracy 21, testified in support 

of repealing the exemption. He argued that the IRS rules on 501(c)(3) 

organizations’ activities lack clarity 

and that combining those rules 

with the Commission’s existing 

exemption has allowed ostensibly 

charitable 501(c)(3) organizations to 

become interventionists in elections. 

He and Paul Ryan, from the Campaign Legal Center, called on the 

Commission to repeal the 501(c)(3) 

exemption. 

Similarly, Frances Hill, Professor of Law and Director of the 

Graduate Program in Taxation at the 

University of Miami School of Law, 

testified that a blanket exemption 

for 501(c)(3) organizations places 

the responsibility of regulation on 

the IRS, which is not equipped to 

handle the responsibility of regulating the political activity of 501(c)(3) 

organizations. 

Exempting Ads Promoting Films, 

Books and Plays

In response to a related Petition 

for Rulemaking, the Commission 

proposes to exempt from its electioneering communications rules ads 

promoting movies, books or plays, 

as long as they are run according to 

normal business practices and the 

communications do not PASO a 

federal candidate. 

Mr. Sandstrom argued that ads for 

political films, books and plays do, 

in fact, PASO federal candidates. He 

thought it inappropriate to create an 

exemption for the advertising of political films, books and plays, while 

eliminating the 501(c)(3) exemption 

that allowed for bona fide grassroots 

lobbying. 

On the other hand, Robert Bauer, 

from Perkins Coie LLP, expressed 

his support for an exemption. 

However, Mr. Bauer argued that the 

PASO requirement in the exemption was redundant and unnecessary 

because the Commission has the 

authority to decide that the exempted 

activities will not PASO. 

Mr. Simon argued that an exemption for ads promoting political 

films, books and plays is not an 

exemption for the work of art, but 

an exemption for the promotion of 

the work of art. He advocated a bona 

fide commercial activity test for 

the ads relating to political movies, 

books and plays. 

Additional Information

The full text of the NPRM and 

public comments submitted to the 

Commission are available on the 

FEC web site at http://www.fec.

gov/law/law_rulemakings.shtml.

 —Carrie Hoback

Notice of Proposed 

Rulemaking on the Definition 

of “Solicit” and “Direct”

On November 15, 2005 the 

Commission held a public hearing 

concerning proposed changes to its 

definitions of the terms “solicit” and 

“direct” as they relate to the raising 

and spending of federal and nonfederal funds. The rulemaking stems 

from court decisions in Shays v. FEC

that invalidated the existing regulatory definitions of those terms. 

Background

In promulgating regulations 

to implement provisions of the 

newly enacted Bipartisan Campaign 

Reform Act of 2002 (BCRA), the 

Commission defined “to solicit” as 

“to ask that another person make a 

contribution, donation, transfer of 

funds, or otherwise provide anything 

of value.” The Commission defined 

“to direct” as “to ask a person who 

has expressed an intent to make a 

contribution, donation, or transfer 

of funds, or to provide anything of 

value, to make that contribution, 

(continued on page 8)
Federal Election Commission RECORD December 2005

8

“suggest” and “recommend” and by 

incorporating a reasonable person 

standard into the revised definition, “solicit” would cover not only 

communications that explicitly and 

directly request contributions or 

donations, but also communications 

that implicitly or indirectly attempt 

to motivate another person to make a 

contribution or donation. 

The Commission sought comment on whether it should modify 

the proposed definition of “solicit” 

to include solicitations conveyed 

largely through conduct. 

The NPRM also invited comments on several alternatives to the 

proposed definition of “solicit.” 

One alternative would adopt the 

definition proposed in the NPRM 

but without a “reasonable person 

standard.” Another would start from 

the current definition and modify it 

to make clear that the regulation applies not only to explicit requests or 

communications but also to indirect, 

implied requests for contributions or 

donations. A third alternative would 

preserve the current definition of 

“solicit” but would revise the Explanation and Justification (E&J) for 

the rules to clarify that the current 

definition includes communications 

that are implicit or indirect requests 

for contributions or donations. Yet 

another alternative would leave the 

term “to solicit” undefined and allow 

the meaning to develop on a caseby-case basis through the advisory 

opinion and enforcement processes. 

Fundraisers

The Commission also invited 

comments as to whether advisory 

opinions that allow a federal candidate or officeholder to attend and 

participate (with various restrictions 

and disclaimer requirements) at 

fundraising events (other than events 

held by a state, district or local 

party) where nonfederal funds are 

being raised are inconsistent with 

BCRA’s language or Congressional 

intent. See Advisory Opinions 2003-

03, 2003-05 and 2003-36. 

Examples of Solicitation

The Commission is also considering whether to incorporate into 

the E&J or the regulation a set of 

examples describing communications that would and would not be 

considered solicitations. 

Proposed Revisions to the 

Definition of “Direct”

The Commission proposes to 

revise 11 CFR 300.2(n) by defining 

“to direct” as “to guide a person who 

has expressed an intent to make a 

contribution, donation, transfer of 

funds, or otherwise provide anything 

of value, by identifying a candidate, 

political committee or organization, 

for the receipt of a contribution, 

donation, transfer of funds, or thing 

of value. The contribution, donation, 

transfer or thing of value may be 

made or provided directly or through 

a conduit or intermediary.” Under 

the proposed rule, “direct” would 

encompass situations where a person 

has already expressed an intent to 

make a contribution or donation that 

would advance a particular interest, 

but lacks the identity of an appropriate candidate or organization to 

which to make that contribution or 

donation. The act of direction would 

consist of providing the contributor 

with the identity of an appropriate recipient for the contribution or 

donation. 

Public Hearing

At its November 15 public hearing, the Commission heard testimony from witnesses supporting and 

opposing the proposed rules. 

Joseph Sandler, representing the 

Democratic National Committee, 

testified in favor of the proposed 

definitions of “solicit” and “direct.” 

Mr. Sandler urged the Commission 

to make clear in the regulation that 

merely expressing support or praise 

for an organization or entity does 

not, by itself, constitute soliciting 

funds for that entity. Mr. Sandler 

cautioned against including nonverbal conduct in the definition of 

solicit.

donation, or transfer of funds, or to 

provide that thing of value.” 

The primary House sponsors of 

the BCRA—Representatives Shays 

and Meehan—successfully challenged those definitions (and several 

other BCRA regulations) in court. 

In its decision upholding the district 

court’s invalidation of the rules, 

the Court of Appeals held that the 

Commission’s definitions of “to 

solicit” and “to direct” were invalid 

because they violated Congress’s 

intent. As to the term “solicit,” the 

Court of Appeals concluded that by 

limiting “solicit” to explicit, direct 

requests for money, and thus permitting indirect requests for funds, 

the Commission’s definition allows 

candidates and parties to circumvent 

BCRA’s prohibitions and restrictions 

on nonfederal funds and thereby violates “Congress’s intent to shut down 

the soft-money system.” As to the 

term “direct,” the Court of Appeals 

held that the Commission’s definition of “direct” was invalid because 

it effectively defined “direct” as 

“ask” and thus, like the definition of 

“solicit” and contrary to Congress’s 

intent, limited “direct” to explicit 

requests for funds. 

Proposed Revisions to the 

Definition of “Solicit”

To comply with the court decisions in Shays, the Commission 

published a Notice of Proposed 

Rulemaking (NPRM) on September 

28, 2005. (70 FR 56599) The proposed rules would revise the definition of “solicit” to mean “to ask, 

suggest or recommend that another 

person make a contribution, donation, transfer of funds, or otherwise 

provide anything of value, whether 

it is to be made or provided directly 

or through a conduit or intermediary. A solicitation is a written or oral 

communication, whether explicit 

or implicit, construed as a reasonable person would understand it 

in context.” See proposed 11 CFR 

300.2(m). By including the terms 
December 2005 Federal Election Commission RECORD 

9

Alternative 

Dispute 

Resolution

Don Simon, representing Democracy 21, Larry Noble, representing 

the Center for Responsive Politics, 

and Paul Ryan, representing the 

Campaign Legal Center, also testified in support of the Commission’s 

proposed definition of “solicit” but 

asked the Commission to incorporate the “conduct” element proposed 

in the NPRM. Mr. Ryan urged the 

Commission to include in the E & 

J the examples of communications 

that would and that would not constitute a solicitation from the NPRM 

but to revise these examples to also 

reflect the elements of context and 

conduct. As to the definition of 

“direct,” Mr. Ryan suggested that 

the proposed definition be modified 

by deleting the phrase “who has 

expressed an intent.”

Marc Elias, representing the 

Democratic Congressional Campaign Committee and the Democratic Senatorial Campaign Committee, 

William McGinley, representing 

the National Republican Senatorial 

Committee and Donald McGahn, 

representing the National Republican Congressional Committee, 

filed joint comments supporting the 

proposed definition of “direct” but 

opposing the proposed definition of 

“solicit.” All three testified in support of an alternative contained in 

the NPRM that would retain the current definition of “solicit” but clarify 

in the E & J that the Commission 

will apply the rule to indirect and 

implied requests as well. All three 

opposed the inclusion of non-verbal 

conduct in the definition of “solicit.” 

Both the NPRM and the comments it generated are available on 

the FEC web site at http://www.fec.

gov/law/law_rulemakings.shtml.

 —Amy Pike

ADR Program Update

The Commission recently resolved 16 additional cases under 

the Alternative Dispute Resolution 

(ADR) program. The respondents, 

the alleged violations of the Federal 

Election Campaign Act (the Act) and 

the final disposition of the cases are 

listed below. Cases marked with an 

asterisk were internally generated. 

1-5. The Commission rejected the 

consolidated settlement agreement 

for LeSueur for Congress ’04 and its 

treasurer Eddie “Edie” D. Ingrum, 

regarding the committee’s alleged 

excessive salary payments thus 

resolving four ADR cases and closed 

the files. Statements of Reasons 

were issued by Chairman Thomas 

and Commissioners Mason, Smith 

and Weintraub. The Commission 

Final Rules Eliminate De 

Minimis Exemption for 

Levin Fund Disbursements

On November 10, 2005, the 

Commission voted to remove 

from its regulations an exemption 

allowing state, district and local 

party committees and organizations 

to use only Levin funds1 to pay for 

certain types of federal election 

activity (FEA) aggregating $5,000 

or less in a calendar year.

Background 

On July 29, 2002, the Commission promulgated regulations at 11 

CFR 300.32(c)(4) requiring any 

state, district or local party committee that spends more than $5,000 

for allocable Type 1 and Type 2 

FEA2 in a calendar year either to 

pay for such expenses entirely with 

federal funds or to allocate between 

federal and Levin funds. Under the 

so-called “de minimis exemption,” 

any state, district or local party 

committee that spent $5,000 or less 

for those types of FEA in a calendar year could finance the activity 

entirely with Levin funds.

In Shays v FEC, the district court 

held that the de minimis exemption 

was inconsistent with Congressional 

intent. The Commission appealed 

the court’s ruling, but also issued 

1

 Levin funds, a type of nonfederal funds 

raised only by state, district or local 

political party committees, are limited 

to donations of $10,000 per calendar 

year and may be raised from sources 

otherwise prohibited by the Federal 

Election Campaign Act (except foreign 

nationals). 11 CFR 300.31.

2

 “Allocable Type 1 and Type 2” FEA 

is: 1) voter registration activity 120 days 

before a federal election; and 2) voter 

identification, get-out-the-vote activity 

or generic campaign activity in connection with an election in which a candidate for federal office appears on the 

ballot. Neither type of activity may be 

allocated if it refers to a clearly identified federal candidate. 11 CFR 100.24.

a Notice of Proposed Rulemaking 

(NPRM) to eliminate the exemption. 

(See the March 2005 Record, page 

6.) On July 15, 2005, the Court of 

Appeals for the D.C. Circuit affirmed the district court’s opinion. 

Final Rules

In light of the appeals court’s decision, and after considering public 

comments, the Commission decided 

to eliminate the $5,000 de minimis

exemption. The revised rules require 

state, district and local committees 

and organizations of political parties 

to pay for all allocable Type 1 and 

Type 2 FEA either entirely with 

federal funds or with an allocation of 

federal and Levin funds without regard to their total amount of annual 

disbursements.

The final rules appeared in the 

Federal Register on November 17. 

See 70 FR 69631.

 —Michelle L. Ryan

(continued on page 10)
Federal Election Commission RECORD December 2005

10

also dismissed a complaint against 

LeSueur for Congress ’04 as it was 

a duplicate. (ADRs 196, 198, 199, 

200, and 213/MURs 5433/5435/545

7/5459/5596)

6. The Commission reached 

agreement with the National Right to 

Life PAC, and its treasurer, Amarie 

C. Natividad, regarding their failure 

to disclose all of the Committee’s 

receipts on its 2003 Year-end Report. 

The respondents acknowledged 

reporting errors and agreed to pay a 

$5,000 civil penalty. In addition, the 

committee has taken steps to ensure 

complete disclosure reports are filed 

timely. In an effort to avoid similar 

errors in the future, respondents 

agree to send the director of records 

maintenance to an FEC seminar 

within 12 months of the effective 

date of this agreement. (ADR 225*)

7. The Commission reached agreement with Peter Hort for Congress, 

and its treasurer, Tal Weitzman. 

Respondents acknowledge that some 

inadvertent reporting omissions may 

have occurred due to their inexperience, but denied allegations of 

excessive or prohibited contributions 

and failure to include required disclaimers on public communications 

(i.e., the committee website). Respondents, in an effort to resolve this 

matter, agree to work with Commission staff to terminate the committee. 

(ADR 238/MUR 5529)

8. The Commission closed a failure to file case against the Committee 

to Elect Gabriel Pearse for Congress 

2004, and its treasurer, Emmanuel 

Roy. The ADR Office recommended 

that the case be closed, and the Commission agreed and closed the file. 

(ADR 266/MUR 5551)

9. The Commission closed the 

case against Gordon S. and Eileen 

Harang for failure to file a 24-Hour 

Report of Independent Expenditures 

made. The ADR Office recommended that the case be closed, and the 

Commission agreed and closed the 

file. (ADR 269/MUR 5603)

10. The Commission reached 

agreement with the Committee to 

Elect John Barker, and its treasurer, 

Alicja Barker, regarding the failure to accurately disclose a loan, 

operating expenses and an excessive 

contribution on the committee’s 

12-Day Pre-Primary Report. The 

respondents acknowledged reporting 

errors and agreed to pay a $500 civil 

penalty. Respondents also acknowledged that a loan from the candidate’s daughter should have been 

reported as a contribution and that it 

represented an excessive contribution to the committee. An amended 

report was subsequently filed and 

respondent John Barker reported a 

payment of $25,000 recently made 

to his daughter to cover the aforementioned loan. (ADR 176*)

11. The Commission reached 

agreement with the Mike Thompson 

for Congress Committee, and its 

treasurer, Tom Hannigan, regarding 

the committee’s failure to disclose a 

$65,115 disbursement. The respondents agreed to pay a $2,500 civil 

penalty, but attributed the omission 

to an inadvertent failure to record 

a wire transfer made to a media 

company, exacerbated by subsequent 

staff changes. After discovering the 

error, respondents filed an amended 

report with the Commission. Additionally, respondents explained 

that they have instituted procedural 

changes to ensure that wire transfers 

are properly recorded by the committee as disbursements, in order to 

prevent a repetition of this reporting error. Additionally, respondents 

agree to send their assistant treasurer 

to an FEC seminar on federal election campaign reporting requirements. (ADR 261*)

12-13. The Commission reached 

agreement with the National Italian 

American PAC, and its treasurer, 

Anthony N. Mallace, regarding the 

failure to accurately report expenditures, accepting excessive contributions and failure to file disclosure 

reports. The respondents acknowledged the inadvertent reporting 

violations occurred due to the 

inexperience of a volunteer staff and 

agreed to pay a $10,000 civil penalty. After discovering the reporting 

violations and prohibited contributions/loans, the Committee initiated 

corrective actions. In an effort to 

avoid similar errors in the future, 

respondents agree to employ an election law compliance officer within 

30 days of the effective date of this 

agreement; send the treasurer and 

compliance officer to a FEC seminar appropriate for PACs within 12 

months of the effective date of this 

agreement; and work with a RAD 

analyst to ensure that all required reports are filed within 90 days of the 

effective date of this agreement.

The Commission and respondents 

initially determined that an appropriate civil penalty to resolve these 

matters was $35,000. However, by 

respondents consenting to certain 

terms and conditions, the Commission agrees to a special arrangement. 

Respondents will pay $10,000 of the 

civil penalty within 60 days of the 

effective date of this agreement. In 

the event that the terms of this agreement are violated, or the respondents 

fail to comply with the requirements 

of the Act during the 24 months 

following the effective date of this 

agreement, the unpaid balance of 

the civil penalty of $35,000 shall be 

due immediately to the Commission. 

(ADR 223* & 256* / OAR 1130, 

1325, 1386)

14. The Commission reached 

agreement with Rick for Congress, 

and its treasurer, Doreen Penberthy, 

regarding the failure to file disclosure reports electronically and in 

a timely manner. The respondents 

acknowledged they misunderstood 

the Commission’s reporting requirements and agreed to pay a $1,500 

civil penalty. In order to avoid 

similar errors in the future, respondents agree to send a representative 

to a FEC seminar on federal election 

campaign finance reporting requirements. (ADR 237/MUR 5521)

ADR

(continued from page 9)
December 2005 Federal Election Commission RECORD 

11

15. The Commission reached 

agreement with Independent Action, Inc., and its treasurer, Ralph 

Santora, regarding the failure to file 

disclosure reports. The respondents 

acknowledged that staff turnover and 

unfamiliarity with the Commission’s 

reporting requirements led to delays 

in submitting the required reports 

and agreed to pay a $12,000 civil 

penalty. Respondents also agree 

to send a representative to a FEC 

seminar on campaign reporting requirements within 15 months of the 

effective date of this agreement and 

to prepare and maintain guidelines 

that will assist their staff in complying with FEC reporting requirements. (ADR 246*)

16. The Commission reached 

agreement with Community Action Program PAC, and its treasurer, 

Cathy Hoskins, regarding the failure 

to disclose receipts in a timely 

manner. In an effort to avoid similar errors in the future, respondents 

agree to contract with an accounting 

firm, familiar with the Commission’s 

reporting requirements, to oversee 

and regularly review the Committee’s reports prior to their filing 

with Commission; to establish and 

maintain a file of FEC regulations 

and Commission materials to guide 

the their staff in complying with the 

Act’s reporting requirements; and 

to send the Director of Administration to a FEC seminar on reporting 

requirements. (ADR 276*)

 — Elizabeth Kurland

Administrative 

Fines

Committees Fined for 

Nonfiled and Late Reports

The Commission recently publicized its final action on 111 new 

Administrative Fine cases, bringing 

the total number of cases released to 

 

1. Ada M. Fisher for Congress $9751

2. Al Green for Congress 30 Day Post-General 2004 $6,500

3. Al Green for Congress Year End 2004 $3,300

4. Albert Robles for Congress $1,3501

5. American Academy of Nurse Practitioners PAC $300

6. American PAC $1,800

7. American Psychiatric Association Political Action Committee $9001

8. Americans for Democratic Action Inc. PAC $250

9. Americans for Democratic Action Inc. PAC Year End 2004 $1151

10. Blue Shield of California PAC $500

11. Broyhill for Congress $11,000

12. Byron for Congress $140

13. Campaign for Florida’s Future (FKA Betty Castor for US Senate) $17,847

14. Campbell for Senate $5,250

15. Calumet PAC $500

16. Charlie Melancon Campaign Committee, Inc. $3,050

17. Chase Committee $100

18. Chris Jennings for Congress $250

19. Christensen 4 Congress $4,5001

20. Clay for Congress.com $250

21. Cody Robert Judy U.S. Senate Looking Good Campaign 2004 $1,4001

22. Colonial Bancgroup Inc. Federal PAC (Colonial Fed PAC)

 30 Day Post-General 2004 $1,350

23. Colonial Bancgroup Inc. Federal PAC (Colonial Fed PAC)

 Year End 2004 $1,575

24. Committee to Elect William Vaden for Congress $500

25. Committee to Re-Defeat the President $480

26. Congressional Black Caucus PAC (CBC-PAC)

 30 Day Post-General 2004 $9,000

27. Congressional Black Caucus PAC (CBC-PAC)

 Year End 2004 $10,125

28. Constitutional Party of Pennsylvania $500

29. Contra Costa United Democratic Campaign AKA CCUDC $420

30. Crowson for Congress $5001

31. Democratic Party of Orange County Fed PAC $1,400

32. Diageo North America Inc. Employees’

 Political Participation Committee $190

33. Empire District Electric Company PAC $200

34. Fleming for Congress 2004 $3121,2

35. Friends of Chris Dodd $6,300

36. Friends of Jeff Seemann for Congress 12 Day Pre-General 2004 $3,0001

37. Friends of Jeff Seemann for Congress 30 Day Post-General 2004 $2,7001

38. Friends of Jeff Seemann for Congress Year End 2004 $3,3751

39. Friends of Jeff Smith $5,5001

40. Friends of Paul DeWeese for Congress $3,500

41. Friends of Richard Hoffman $1502

42. Gary Nolan for President October Monthly 2004 $6251

43. Gary Nolan for President December Monthly 2004 $6251

44. Gary Nolan for President Year End 2004 $7501

Committees Fined and Penalties Assessed

1 This civil money penalty has not been collected.

2 This civil money penalty was reduced due to the level of activity on the 

report. (continued on page 12)
Federal Election Commission RECORD December 2005

12

the public to 1,216, with $1,641,132 

in fines collected by the FEC during 

the four years that the program has 

been in place.

Civil money penalties for late 

reports are determined by the number of days the report was late, the 

amount of financial activity involved 

and any prior penalties for violations under the administrative fines 

regulations. Penalties for nonfiled 

reports—and for reports filed so late 

as to be considered nonfiled—are 

also determined by the financial 

activity for the reporting period and 

any prior violations. Election sensitive reports, which include reports 

and notices filed prior to an election 

(i.e., 12-day pre-election, October 

quarterly and October monthly 

reports), receive higher penalties. 

Penalties for 48-hour notices that are 

filed late or not at all are determined 

by the amount of the contribution(s) 

not timely reported and any prior 

violations.

The committee and the treasurer 

are assessed civil money penalties 

when the Commission makes its 

final determination. Unpaid civil 

penalties are referred to the Department of the Treasury for collection.

The committees listed in the adjacent charts, along with their treasurers, were assessed civil money 

penalties under the administrative 

fines regulations. 

Closed Administrative Fine case 

files are available through the FEC 

Press Office and Public Records Office at 800/424-9530.

 

45. Graphic Communications International Union

 Political Contributions Committee $500

46. Honest Abe Hirschfled for United States Senate

 April Quarterly 2004 $11,0001

47. Honest Abe Hirschfled for United States Senate

 July Quarterly 2004 $13,7501

48. Honest Abe Hirschfled for United States Senate

 October Quarterly 2004 $21,0001

49. Honest Abe Hirschfled for United States Senate

 12 Day Pre-General 2004 $21,0001

50. Honest Abe Hirschfeld for United States Senate 

 30 Day Post-General 2004 $16,5001

51. Honest Abe Hirschfeld for United States Senate Year End 2004 $22,0001

52. Independence Party of Minnesota $230

53. Independent Action Inc. October Quarterly 2004 $4,0001

54. Independent Action Inc. 30 Day Post-General 2004 $4,3751

55. Independent Action Inc. Year End 2004 $6251,2

56. International Chiropractors Association—PAC $520

57. Italian American Democratic Leadership Council $300

58. IUOE Local 542 Operating Engineers Political Action Fund $1,295

59. James A. Garner Congressional Committee 

 30 Day Post-General 2004 $4,5001

60. James A. Garner Congressional Committee Year End 2004 $4,5001

61. Jack Davis for Congress $11,200

62. John Kennedy for U. S. Senate Inc. $560

63. John McKinnis for Congress Inc. Year End 2004 $02

64. John McKinnis for Congress Inc. 30 Day Post-General $900

65. John McConnel Wolfe Jr. for Congress $02

66. Kelly Services Inc. PAC (KELLYPAC) $900

67. Kennebunkport Democratic Committee $300

68. Keyspan Energy PAC (KEYPAC) $130

69. LaFarge North America Inc. PAC $195

70. Liffrig for Senate $4,5001

71. Lincoln Club of Riverside County $6252

72. Mac Collins for Senate $1,475

73. Metro-Goldwyn-Mayer PAC $500

74. Metro-Goldwyn-Mayer PAC Year End 2004 $118

75. McKenna Long and Aldridge LLP PAC $155

76. Michels for U.S. Senate $22,292

77. Monterey County Republican Central Committee Fed. $550

78. Morris Meyer for Congress $9001

79. Northside Democrats United $1,8002

80. Pat Neal for Congress $02

81. Pipefitters’ Local Union No 522 Political Action Fund $120

82. Plumbers Local 519 PAC $250

83. Randy Camacho for Congress 2004 $2,250

84. Robinson for Congress $4,170

85. Salazar for Senate $5,500

86. Saull for Senate $02

1 This civil money penalty has not been collected.

2 This civil money penalty was reduced due to the level of activity on the 

report.

Committees Fined and Penalties Assessed, cont.

MUR 5386: Union 

Contributions; Contributions 

in the Name of Another

The Commission has entered 

into a conciliation agreement with 

the International Association of 

Compliance

Administrative Fines

(continued from page 11)
December 2005 Federal Election Commission RECORD 

13

87. Scott for Congress $2502

88. Simon Pristoop for Congress Committee $195

89. Sitter for Congress Year End 2004 $312

90. Sitter for Congress October Quarterly 2004 $900

91. Smith for Congress LLC $2502

92. Socas for Congress $7,8301

93. Socas for Congress Year End 2004 $11,8751

94. Southeast Anesthesia Associates PAC

 30 Day Post-General 2004 $425

95. Southeast Anesthesia Associates PAC

 Year End 2004 $375

96. Stace Williams for U. S. Congress $1,3501

97. Stephanie Summers O’Neal for U.S. Congress 

 October Quarterly 2004 $5,2501

98. Stephanie Summers O’Neal for U.S. Congress Year End 2004 $7,8751

99. Steven Reifman for Congress $2501

100. Sugar Cane Growers Cooperative of Florida $1811

101. Teamsters Local Union No 688 PAC $155

102. Trover Solutions Inc. $440

103. Uniformed Firefighters Association PAC $690

104. United Brotherhood of Carpenters/Joiners of America 

 New England Reg. Carpenters Legis. Emp. Cmte. $193

105. U.S. Immigration Reform PAC $135

106. Virgil Yanta for Congress $3,3751

107. WAWA Inc. Political Action Committee 

 12 Day Pre-General 2004 $6001

108. WAWA Inc. Political Action Committee 

 30 Day Post-General 2004 $2401

109. Whit for Congress $250

110. Women’s Alliance for Israel (WAI-PAC) $218

111. WV Republican State Executive Committee $6,600

Committees Fined and Penalties Assessed, cont.

1 This civil money penalty has not been collected.

2 This civil money penalty was reduced due to the level of activity on the 

report.

Machinists and Aerospace Workers (IAMAW) District Lodges 141, 

141-M and 142, Local Lodge 1487, 

IAMAW’s PAC (MNPL) and the 

PAC’s treasurer. In the agreement, 

the respondents admit to violating 

the Federal Election Campaign Act 

(the Act) by using union treasury 

funds to reimburse union member 

contributions to IAMAW’s PAC. 

This conciliation agreement prohibits future misconduct by the respondents and requires them to pay a 

$151,000 in civil penalty. 

Background

The Act prohibits unions from 

making contributions or expenditures 

from their general treasury funds in 

connection with any election of any 

candidate for federal office. Additionally, under the Act, it is illegal 

to reimburse any person for their 

contributions to any federal political 

committee. Therefore, a union may 

not reimburse its members, directly 

or indirectly, for any contributions 

they make to a political committee. 2 

U.S.C. §§441b and 441f.

Between 2000 and 2003, IAMAW 

District Lodges 141, 141-M and 142 

and Local Lodge 1487 held at least 

20 conventions and conferences at 

which delegates voted, according to 

longstanding practice, to donate their 

registration fees to IAMAW’s PAC, 

MNPL. The union used its treasury 

funds to reimburse many of the delegates’ registration fees. Additionally, 

IAMAW officers and MNPL representatives at each district and local lodge 

were aware that registration fees were 

being contributed to MNPL. 

Conciliation Agreement

The IAMAW respondents admitted in their conciliation agreement to 

using union treasury funds to reimburse union member contributions to 

the IAMAW’s PAC. The respondents 

agreed to pay a joint civil penalty of 

$151,000 and to cease and desist from 

further such violations of the Act. 

Additional Information 

For additional information on this 

case, please visit the Commission’s 

Public Records Office or consult 

the Enforcement Query System on 

the FEC’s web site and enter case 

number 5386.

 —Kathy Carothers

MUR 5611: Missouri 

Democratic Party

The Missouri Democratic State 

Committee has agreed to pay a 

$110,000 civil penalty for violations 

of the Federal Election Campaign 

Act (FECA) during the 1999-2000 

election cycle. 

Background

Having noted irregularities in 

the committee’s financial reports, 

the Commission audited the Missouri Democratic State Committee 

after each election cycle from 1996 

through 2002. Those audits uncovered multiple FECA violations 

during the 1999-2000 election cycle, 

leading to this enforcement action. 

(continued on page 14)
Federal Election Commission RECORD December 2005

14

Outreach

February Conference in 

Tampa

In February the Commission will 

hold a regional conference in Tampa 

for House and Senate campaigns, 

political party committees and corporations, labor organizations, trade 

associations, membership organizations and their respective PACs. The 

conference will consist of a series 

of workshops where Commissioners and experienced staff conduct 

a variety of technical workshops 

on federal campaign finance law. 

Workshops are designed for those 

seeking an introduction to the basic 

provisions of the law as well as for 

those more experienced in campaign 

finance law. 

The Tampa conference will be 

held February 1-2 at the Wyndham 

Harbour Island Hotel. The registration fee for this conference is $375, 

which covers the cost of the conference, a reception, materials and 

meals. A $10 late fee will be added 

to registrations received after January 6. For additional information, or 

to register for the conference, please 

visit the FEC web site at http://

www.fec.gov/info/conference_materials/2006/tampa/tampa_06.shtml. 

The Wyndham Harbour Island is 

located in downtown Tampa at 725 

South Harbour Island Boulevard. A 

room rate of $169 (single or double) 

is available to conference attendees 

who make reservations on or before 

January 2. To make your hotel 

reservations, please visit http://

www.wyndham.com/groupevents/

867FEC/main.wnt, or call 1-813-

229-5000 or 1-800-WYNDHAM 

and indicate that you are attending 

the FEC conference. The FEC suggests that you wait to make your 

hotel and air reservations until you 

have received confirmation of your 

conference registration.

Please direct all questions about 

conference registration and fees to 

Sylvester Management Corporation 

(Phone: 1-800/246-7277; e-mail: 

tonis@sylvestermanagement.com). 

For questions about the conference 

program, call the FEC’s Information 

Division at 1-800/424-9530 (press 6) 

(locally at 202/694-1100), or send an 

e-mail to Conferences@fec.gov.

 —Dorothy Yeager

2006 Conference 

Schedule

Conference for Campaigns, 

Parties and Corporate/Labor/

Trade Assn. PACs

February 1-2, 2006

Wyndham Harbour Island 

Tampa, FL 

Conference for House and 

Senate Campaigns and Political 

Party Committees

March 15-16, 2006 

(CORRECTION)

Omni Shoreham

Washington, D.C.

Conference for Corporations 

and their PACs

April 25-26, 2006 (tentative)

Capitol Hilton (tentative)

Washington, D.C.

Conference for Trade 

Associations, Labor 

Organizations, Membership 

Organizations and their PACs

May 25-26, 2006

Hyatt Regency on Capitol Hill

Washington, D.C.

According to the conciliation 

agreement, the Missouri Democratic 

State Central Committee violated the 

law during the 2000 election cycle 

by: 

• Failing to report the receipt and 

transfer to the party’s nonfederal 

account of $176,125 in excessive 

contributions,$159,500 in prohibited corporate and labor contributions and an otherwise permissible 

$5,000 contribution; 

• Accepting $69,500 in prohibited 

contributions; 

• Misreporting its receipts, disbursements and cash-on-hand; and

• Failing to disclose outstanding 

debts totaling over $620,000.

The reporting failures regarding 

excessive contributions stemmed 

from the committee’s practice of 

depositing excessive contributions 

to its federal account, transferring 

the excessive portions to its nonfederal account, and reporting only 

the allowable portion that remained 

in the federal account. The committee treated some of the prohibited 

contributions it received in similar 

fashion. This practice caused the 

committee to misreport receipts, 

disbursements, and cash-on-hand. 

Conciliation Agreement

Under terms of the conciliation 

agreement, the committee will not 

only pay a $110,000 civil penalty, 

but also retain outside consultants 

to review the party’s compliance 

procedures and train committee 

staff and volunteers. Additionally, 

within 90 days of the agreement, the 

committee will file amendments to 

its 2004 election cycle reports, and 

maintain and submit to the FEC, 

upon request, detailed documentation supporting those amendments. 

The committee also agreed to retain 

an independent firm to audit its 

compliance with federal campaign 

finance laws in 2005 and 2006. The 

committee agreed to maintain documentation for all future transfers of 

excessive or prohibited contributions 

and to develop procedures for handling contributions by check where 

the payor is not an individual. 

Additional Information 

For additional information on this 

case, please visit the Commission’s 

Public Records Office or consult 

the Enforcement Query System on 

the FEC’s web site and enter case 

number 5611.
December 2005 Federal Election Commission RECORD 

15

Reporting and FECFile Help

The Commission will kick-off 

the election year by hosting reporting and electronic filing workshops 

on January 18, 2006. The reporting workshops will address common filing problems and respond 

to questions committees may have 

as they prepare to file their January 

31 year-end reports. The electronic 

filing sessions will provide hands-on 

instruction for committees that use 

the Commission’s FECFile software 

and will address questions filers may 

have concerning electronic filing.

Attendance is limited to 30 people 

per session for reporting workshops, 

and 16 people per session for the 

electronic filing workshops. The 

registration form is available on the 

FEC web site at http://www.fec.gov/

info/outreach.shtml#roundtables and 

from Faxline, the FEC’s automated 

fax system (202/501-3413, request 

document 590). For more information, call the Information Division at 

800/424-9530, or locally at 202/694-

1100.

Index

The first number in each citation 

refers to the “number” (month) of 

the 2005 Record issue in which the 

article appeared. The second number, following the colon, indicates 

the page number in that issue. For 

example, “1:4” means that the article 

is in the January issue on page 4.

Advisory Opinions

2004-40: Status of state party as state 

committee of political party, 1:8

2004-41: Non-affiliation of SSFs, 2:4

2004-42: LLC as connected organization for SSF, 2:7

2004-43: Discounted sale of ad time 

not a contribution, 4:6

2004-45: Accounting method to determine excess contributions under 

Millionaires’ Amendment, 3:7

2005-1: Indian tribe not a federal 

contractor, 5:8

2005-2: Fundraising for nonfederal 

committees by federal officeholder 

who is nonfederal candidate, 6:7

Roundtable Schedule

Date Subject Intended Audience 

January 18

9:30-11 a.m.

Reception

11-11:30 a.m.

January 18

1:30-3 p.m.

Reception

3-3:30 p.m.

Reporting for Candidates 

and Their Committees, 

plus “Meet Your Analyst” 

reception

Reporting for PACs and 

Party Committees, plus 

“Meet Your Analyst” 

reception

Individuals responsible 

for filing FEC reports for 

Candidate Committees 

(Up to 30 may Attend)

Individuals responsible 

for filing FEC reports for 

PACs and Party Committees (Up to 30 may 

Attend)

Hands-on Help with 

FECFile and E-filing 

for Candidates and their 

Committees

Hands-on Help with FEC- File and E-filing for PACs 

and Party Committees

January 18

1:30-3 p.m.

January 18

9:30-11 a.m.

Campaigns that use 

FECFile and/or have 

questions about electronic filing (Up to 16 may 

Attend)

PACs and Party Com- mittees that use FECFile 

and/or have questions 

about electronic filing 

(Up to 16 may Attend)

2005-3: Affiliation of membership 

organizations, 6:8

2004-4: Reporting court-ordered 

restitution owed to campaign committee, 6:9

2005-5: Federal candidate/officeholder’s use of funds from nonfederal exploratory committee, 7:8

2005-6: Former officeholder may 

give campaign funds to charity, 8:5

2005-7: Coordinated commentaries 

and editorials result in prohibited 

in-kind contributions, 10:3

2005-9: Campaign may pay travel 

expenses for federal candidate/

officeholder’s minor children, 10:5

2005-10: Candidates/Officeholders 

fundraising for ballot initiatives, 

10:5

2005-11: Using campaign funds for 

legal expenses, 11:1

2005-12: Federal candidate’s nonfederal exploratory activity, 11:3

2005-13: Allocation and solicitation 

rules for nonconnected PAC, 12:1

2005-14: Affiliation of regional trade 

associations, 12:3

2005-15: State party’s termination 

and reorganization, 12:4

2005-17: Affiliation between membership and trade groups, 12:4

Compliance

Administrative fines assessed, 2:13; 

6:13; 9:9; 12:11

ADR program update, 1:9; 2:12; 4:9; 

5:7; 6:10; 9:12; 12:9

MUR 5020: Corporate facilitation, 

4:6

MUR 5386: Contributions in the 

name of another and union contributions, 12:12

MUR 5405: Contributions in the 

name of another and corporate 

contributions, 6:5

MUR 5428: Excessive and prohibited contributions, improper allocation and reporting violations, 6:6

MUR 5183: Corporate contributions, 

7:4

MURs 5428 and 5623: “Millionaires’ Amendment,” 9:10

MUR 5611: Excessive and prohibited contributions, reporting errors, 

12:13
FEDERAL ELECTION COMMISSION

999 E Street, NW

Washington, DC 20463

Official Business

Penalty for Private Use, $300

Federal Election Commission RECORD December 2005

Court Cases 

_____ v. FEC

– Alliance for Democracy, 4:4

– Augusti and Augusti for Congress, 

1:12; 10:3

– Citizens for Responsibility and Ethics in Washington (04-2145), 2:10

– Citizens for Responsibility and Ethics 

in Washington (04-1672), 7:3; 12:6

– Cooksey, 10:3

– EMILY’s List, 3:1; 4:1

–Hagelin, 8:4

– Judicial Watch, 4:3

– Kean for Congress, 4:3

– Shays and Meehan, 9:1; 12:1

– Sykes, 6:5

– Wisconsin Right to Life, 7:1

FEC v. _____ 

– Democratic Party of New Mexico, 6:1

– Friends of Lane Evans, et. al., 8:1

– Odzer, 9:3

Regulations

“Agent” definition for coordinated 

and independent expenditures and 

nonfederal funds rules, NPRM, 3:4; 

public hearing, 5:5; 7:6

BCRA technical revisions, final rules, 1:6

Candidate solicitation at state, district 

and local party committee fundraisers, NPRM, 4:4; public hearing, 5:5; 

7:6; Revised E&J, 8:1

Civil penalties inflation adjustment, 7:5

Contributions by minors to candidates 

and party committees, final rules, 3:3

“De minimis” exemption for Levin 

fund disbursements by state, district 

and local party committees, NPRM, 

3:6; Final rules, 12:9

Electioneering Communications definition, NPRM, 10:6; public hearing 12:6

“Federal Election Activity” definition, 

Notice of Proposed Rulemaking, 

6:1; public hearing scheduled, 8:3; 

public hearing held, 9:4; comment 

period extended, 10:8

Filing by Priority Mail, Express Mail 

and overnight delivery, NPRM, 2:1; 

final rules, 5:4

Internet communications, Notice of 

Proposed Rulemaking, 5:1; Hearing 

on proposed rules, 8:2

Party committee donations to certain 

tax-exempt organizations and political organizations, Notice of Proposed 

Rulemaking, 1:7; final rules, 5:4

Payroll deductions for contributions to 

trade association SSF, NPRM, 2:2; 

public hearing scheduled, 5:5; public 

hearing, 7:6; final rules, 9:1

Salaries and wages paid by state, 

district and local party committees, 

Notice of Proposed Rulemaking, 

6:3; public hearing scheduled, 8:3; 

public hearing held, 9:4; comment 

period extended, 10:8 

Solicit/Direct definition, NPRM and 

public hearing 12:7 

Travel rules for certain Presidential 

candidates, effective date, 7:6

Reports

April reporting reminder, 4:1

California special election reporting, 

2:3; 9:6

Due in 2005, 1:3

Electronic filing software, FEC Form 

3X, updated, 2:1

July reporting reminder, 7:1

October reporting reminder, 10:1

Ohio special election, 6:14