April 2007 Federal Election Commission Volume 33, Number 4

Table of Contents

Reports

April Reporting Reminder

All principal campaign committees of House and Senate candidates 

must file a quarterly report by April 

15, 2007. 11 CFR 104.5(a).

Principal campaign committees 

of Presidential candidates must file a 

report on April 15, if they are quarterly filers, or on April 20, if they are 

monthly filers.

All national party committees, and 

those political action committees and 

state, district and local party committees that file monthly, must file a 

report on April 20. Absent a special 

election, all other PACs and party 

committees will next file a Mid-Year 

Report, due July 31. 

Notification of Filing Deadlines

In addition to publishing this 

article, the Commission makes the filing deadlines available on its web site 

and via its automated Faxline, and 

notifies committees through reporting reminders called prior notices. 

Since January 1, 2007, prior notices 

have been distributed exclusively by 

electronic mail. They are no longer 

sent to committees using U.S. mail. 

See December 2006 Record, page 1. 

For that reason, it is important that 

every committee update its Statement 

of Organization (FEC Form 1) to disclose a current e-mail address. Each 

(continued on page 2) (continued on page 3)

Compliance

MUR 5487: Progress for 

America Voter Fund

The Commission entered into a 

conciliation agreement with Progress 

for America Voter Fund (PFA-VF) 

to settle violations of the Federal 

Election Campaign Act (the Act). 

PFA-VF’s violations included failing 

to register with the Commission as a 

political committee, failing to report 

its contributions and expenditures, 

knowingly accepting excessive 

contributions from individuals and 

knowingly accepting prohibited corporate contributions. PFA-VF agreed 

to pay a civil penalty of $750,000, 

the third-largest civil penalty in the 

Commission’s history.

Background

The Act and Commission regulations require a group whose major 

purpose is to influence federal elections to file a Statement of Organization with the Commission within 

ten days of receiving contributions 

or making expenditures to influence 

federal elections that exceed $1,000 

per calendar year. 11 CFR 100.5. 

All political committees must file 

regular reports with the Commission 

disclosing the committee’s receipts 

and disbursements. Additionally, 

political committees may not accept 

any contributions from corporations 

 Reports

 1 April Reporting Reminder

 Compliance

 1 MUR 5487: Progress for America 

Voter Fund

 3 Policy Statement on Initial Stage 

of Enforcement Process

4 Federal Register Notices

 Regulations

4 2007 Rulemaking Priorities

New Litigation

 5 Bialek v. Gonzales, Marcus v. 

Gonzales and Beam v. Gonzales

5 Advisory Opinions

 Administrative Fines

 9 Update

 Statistics

 10 Party Financial Activity

 Information

 10 Staff Director Testifies on Senate 

E-Filing

Outreach

 10 Washington, DC Conferences

 11 Roundtable Workshops

 11 Index 
Federal Election Commission RECORD April 2007

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)

Robert D. Lenhard, Chairman

David M. Mason, Vice Chairman

Hans A. von Spakovsky, 

 Commissioner

Steven T. Walther, Commissioner

Ellen L. Weintraub, Commissioner

Patrina M. Clark,

 Staff Director

Thomasenia Duncan, 

 Acting General Counsel

Published by the Information

 Division

Greg J. Scott, Assistant Staff

 Director

Meredith E. Metzler, Editor

http://www.fec.gov

committee may have only one official 

e-mail address. Providing more than 

one e-mail address may result in the 

committee not receiving a notice.

Treasurer’s Responsibilities

The Commission provides reminders of upcoming filing dates as a 

courtesy to help committees comply 

with the filing deadlines set forth in 

the Act and Commission regulations. 

Committee treasurers must comply 

with all applicable filing deadlines 

established by law, and the lack of 

prior notice does not constitute an 

excuse for failing to comply with any 

filing deadline.

Please note that filing deadlines 

are not extended in cases where the 

filing date falls on a weekend or 

federal holiday. Accordingly, reports 

filed by methods other than Registered, Certified, or Overnight Mail, 

or electronically, must be received by 

the Commission’s (or the Secretary of 

the Senate’s) close of business on the 

last business day before the deadline.

Filing Electronically

Under the Commission’s mandatory electronic filing regulations, individuals and organizations that receive 

contributions or make expenditures, 

including independent expenditures,1

in excess of $50,000 in a calendar 

year—or have reason to expect to do 

so—must file all reports and statements with the FEC electronically. 

Electronic filers who instead file on 

paper or submit an electronic report 

that does not pass the Commission’s 

validation program by the filing deadline will be considered nonfilers and 

may be subject to enforcement actions, including administrative fines. 

Reports filed electronically must be 

received and validated by 11:59 p.m. 

Eastern Time on the applicable filing 

deadline.

 The Commission’s electronic 

filing software, FECFile 5, can be 

downloaded from the FEC’s web site 

at http://www.fec.gov/elecfil/electron.

shtml. Filers may also use commercial or privately-developed software 

as long as the software meets the 

Commission’s format specifications, 

which are available on the Commission’s web site. 

Senate committees and other committees that file with the Secretary 

of the Senate are not subject to the 

mandatory electronic filing rules.

Timely Filing for Paper Filers

Registered and Certified Mail. 

Reports sent by registered or certified mail must be postmarked on or 

before the mailing deadline to be 

considered timely filed. A committee sending its reports by certified 

mail should keep its mailing receipt 

with the U.S. Postal Service (USPS) 

postmark as proof of filing because 

the USPS does not keep complete records of items sent by certified mail. 

A committee sending its reports by 

registered mail should keep its proof 

of mailing. Please note that a Certificate of Mailing from the USPS is 

not sufficient to prove that a report is 

timely filed using Registered, Certified or Overnight Mail.

Overnight Mail. Reports filed via 

overnight mail2

 will be considered 

timely filed if the report is received 

by the delivery service on or before 

the mailing deadline. A committee sending its reports by Express 

or Priority Mail, or by an overnight 

delivery service, should keep its proof 

of mailing or other means of transmittal of its reports.

Other Means of Filing. Reports 

sent by other means–including first 

class mail and courier—must be 

received by the FEC (or the Secretary 

of the Senate for Senate committees 

and political committees supporting 

only Senate candidates) before the 

Commission’s (or the Secretary of 

the Senate’s) close of business on the 

filing deadline. 2 U.S.C. 434(a)(5) 

and 11 CFR 104.5(e). Paper forms 

are available at the FEC’s web site 

(http://www.fec.gov/info/forms.

shtml) and from FEC Faxline, the 

agency’s automated fax system 

(202/501-3413). 

Filing Frequency for Party 

Committees

National committees of political 

parties must file on a monthly schedule in all years and may not choose to 

change their filing schedule in nonelection years. 2 U.S.C. 434(a)(4)(B).

A state, district and local party 

committee that filed monthly in 2006 

due to its federal election activity 1 The regulation covers individuals and 

organizations required to file reports of 

contributions and/or expenditures with 

the Commission, including any person 

making an independent expenditure. Disbursements for “electioneering communications” do not count toward the $50,000 

threshold for mandatory electronic filing. 

11 CFR 104.18(a).

2 “Overnight mail” includes Priority or 

Express Mail having a delivery confirmation, or an overnight service with 

which the report is scheduled for next 

business day delivery and is recorded in 

the service’s on-line tracking system.

Reports

(continued from page 1)
April 2007 Federal Election Commission RECORD

3

must notify the Commission in writing if it wishes to file semiannually 

in 2007. 11 CFR 104.5(b)(2). After 

filing a notice of change in filing 

frequency with the Commission all 

future reports must follow the new 

filing schedule. Electronic filers must 

file this request electronically. 

Political Action Committees

PACs (separate segregated funds 

and nonconnected committees) may 

file on either a semiannual or monthly 

basis in non-election years. A committee may change its filing frequency only once a year and after giving 

notice of change in filing frequency 

to the Commission, all future reports 

must follow the new filing frequency. 

11 CFR 104.5(c).

Additional Information

For more information on 2007 

reporting dates:

• See the reporting tables in the 

January 2007 Record;

• Call and request the reporting 

tables from the FEC at 800/424-9530 

or 202/694-1100;

• Fax the reporting tables to 

yourself using the FEC’s Faxline 

(202/501-3413, document 586); or

• Visit the FEC’s web page at 

http://www.fec.gov/info/report_dates.

shtml to view the reporting tables 

online.

—Elizabeth Kurland

and, in the case of a political action 

committee (PAC), may accept no 

more than $5,000 per calendar year 

from an individual or another PAC.

Failure to File and Report. PFAVF raised $44.9 million in the five 

months before the 2004 general 

election. The group’s fundraising 

solicitations clearly stated that the 

funds would be used to target the 

election or defeat of specific federal 

candidates in the upcoming election. 

The funds received in response to 

these solicitations were contributions 

that triggered the $1,000 political 

committee registration threshold.

PFA-VF also spent over $31.1 

million in communications related to 

the 2004 general election, including 

television and radio advertisements, 

direct mailings, e-mails and Internet 

banner ads. Certain communications expressly advocated either the 

election of President Bush or the 

defeat of Senator Kerry. As a result, 

payments for the express advocacy 

communications were expenditures 

that formed a separate basis for triggering the $1,000 political committee registration threshold.

Corporate and Excessive Contributions. PFA-VF accepted 

$41,613,000 from individuals who 

contributed more than the $5,000 

per calendar year PAC contribution 

limit and $2,465,000 from sources 

prohibited by the Act.

Conciliation Agreement

PFA-VF will pay a civil penalty 

of $750,000 and has agreed to cease 

and desist from violating the Act. 

The conciliation agreement settled 

all alleged violations as to PFA-VF’s 

status as a federal political committee. PFA-VF will file reports disclosing the activity that they should 

have disclosed as a federal PAC. 

The Commission agreed that PFAVF may meet this requirement by 

filing copies of its IRS reports with 

the FEC along with supplemental 

information. PFA-VF must register 

Compliance

(continued from page 1)

and report as a federal PAC if it engages in future activity that triggers 

registration. 

—Meredith Metzler

Policy Statement on Initial 

Stage of Enforcement Process

On March 1, 2006, the Commission approved a policy statement that 

clarifies the various actions the Commission may take when beginning 

the enforcement process. In the initial 

stages of the process, the Commission will either:

• Find reason to believe;

• Dismiss the matter;

• Dismiss the matter, but send an 

admonishment letter; or 

• Find no reason to believe.

Background

Congress gave the Commission 

exclusive jurisdiction over civil enforcement of violations of the Federal 

Election Campaign Act (the Act). 

The Commission may open enforcement matters based on complaints 

from the public, information learned 

in carrying out its normal duties, including referrals from the Audit and 

Reports Analysis Divisions, referrals 

from other government agencies and 

self-reported submissions. 

According to the Act, the Commission shall investigate alleged 

violations when at least four Commissioners find that there is “reason 

to believe” that a violation has occurred. Such a finding does not mean 

that a violation actually occurred, 

rather that the Commission found 

sufficient legal justification to open 

an investigation to determine whether 

a violation occurred. 

Initial Enforcement 

Determinations

Reason to Believe. The Commission will find “reason to believe” in 

situations where there is enough evidence to warrant an investigation and 

where the alleged violation is serious 

(continued on page 4)

Need FEC Material 

in a Hurry?

 Use FEC Faxline to obtain 

FEC material fast. It operates 

24 hours a day, 7 days a week. 

Hundreds of FEC documents—

reporting forms, brochures, FEC 

regulations—can be faxed almost 

immediately.

 Use a touch tone phone to dial 

202/501-3413 and follow the 

instructions. To order a complete 

menu of Faxline documents, enter 

document number 411 at the 

prompt.
Federal Election Commission RECORD April 2007

4

2007 Rulemaking Priorities

On February 16, 2007, the Commission approved rulemaking priorities for 2007. The priorities include:

• Implementing any changes or additions to the rules necessary as a 

result of Congressional action;

• Explaining how to allocate expenses 

for advertisements that include both 

a federal candidate and a generic 

party reference;

• Conforming the Commission’s 

ethics regulations with governmentwide ethics rules;

• Finalizing the policy statement and 

regulation regarding a treasurer’s 

best efforts in the Administrative 

Fines Program (see January 2007 

Record, page 6);

• Addressing the federal election 

activity exemption for nonfederal 

election activities that expires September 1, 2007;

• Finalizing the Millionaires’ Amendment interim rules at 11 CFR 400;

• Finalizing policy or implement 

regulations regarding the disclosing 

of materials at the close of an enforcement matter (see August 2003 

Record, page 1); and

• Conforming the personal use regulations to the revised statute at 2 

U.S.C. 439a.

The full list of priorities is available on the FEC’s web site at http://

www.fec.gov/agenda/2007/mtgdoc07-10.pdf.

Federal Register

Federal Register notices are 

available from the FEC’s Public 

Records Office, on the web 

site at www.fec.gov/law/law_

rulemakings.shtml and from the 

FEC Faxline, 202/501-3413.

Notice 2007-4

Policy Statement Establishing a 

Pilot Program for Probable Cause 

Hearings (72 FR 7551, February 

16, 2007)

Notice 2007-5

Filing Dates for the Georgia 

Special election in the 10th 

Congressional District (72 FR 

10761, March 9, 2007)

Notice 2007-6

Statement of Policy Regarding 

Commission Action in Matters 

at the Initial Stage in the 

Enforcement Process (72 FR 

12545, March 16, 2007)

enough to require an investigation or 

immediate conciliation. A “reason to 

believe” finding will always be followed either by an investigation or a 

pre-probable cause conciliation. 

A “reason to believe” finding does 

not itself establish that a violation has 

occurred. If the Commission accepts 

a conciliation agreement, the agreement will contain the Commission’s 

ultimate findings. If the Commission does not enter into a conciliation agreement and does not file a 

lawsuit, individuals can look at the 

Commission’s Statement of Reasons, Factual and Legal Analysis or a 

General Counsel’s Report for further 

explanation of the Commission’s 

conclusions.

Previously, the Commission used 

the finding “reason to believe, but 

take no further action” when the 

Compliance

(continued from page 3)

Commission found a basis for investigating or attempting to conciliate but 

declined to investigate or conciliate. 

The Commission has determined that 

the phrases “dismissal” or “dismissal 

with admonishment” are clearer 

about the Commission’s intentions 

than “reason to believe, but take no 

further action.” 

Dismissal. The Commission has 

broad discretion to determine how to 

proceed with complaints or referrals. 

The Commission may exercise its 

prosecutorial discretion to dismiss 

cases that do not merit the use of 

Commission resources. Dismissal 

requires the vote of at least four 

Commissioners. Factors influencing 

dismissal could include insignificance 

of the alleged violation, weakness of 

evidence, likely difficulties with an 

investigation or the lack of the necessary four votes to proceed with the 

matter. The Commission may dismiss 

when the cost of investigating is great 

but the violation is minor. 

Dismissal with Admonishment. 

The Commission may dismiss a matter when the Commission concludes 

that a violation did occur, but the 

violation is of minor significance. In 

such a matter, the Commission will 

send a letter admonishing the respondent. Examples of such situations 

include when the respondent admits 

to a violation but the violation does 

not require a monetary penalty or if 

a complaint convincingly alleges a 

violation but the significance of the 

violation is too low to warrant further 

investigation by the Commission.

No reason to believe. If available information provides no basis 

for proceeding with the matter, the 

Commission will find “no reason to 

believe.” Such a finding occurs when 

the complaint, the response by the 

respondent and any publicly available 

information, taken together, fail to 

suggest that a violation has occurred. 

Examples of “no reason to believe” 

include when a complaint alleges a 

violation but the response shows that 

no violation occurred, the complaint 

is not credible or too vague or if the 

complaint does not describe a violation of the Act.

The “Statement of Policy Regarding Commission Action in Matters at 

the Initial State in the Enforcement 

Process” was published in the Federal 

Register on March 16, 2007 (72 FR 

12545) and is available on the Commission’s web site at http://www.fec.

gov/law/policy.shtml#policy.

—Meredith Metzler

Regulations
April 2007 Federal Election Commission RECORD

5

Court Cases

Bialek v. Gonzales, 

Marcus v. Gonzales and 

Beam v. Gonzales

During February and March 2007, 

Barry Bialek, Jon Marcus and Jack 

and Renee Beam filed separate, but 

substantially similar complaints with 

district courts in Colorado, Arizona 

and Northern Illinois, respectively, 

alleging that the Commission violated 

the Federal Election Campaign Act 

(the Act) by “tacitly cooperating and 

conspiring with” Attorney General 

Alberto Gonzales to circumvent the 

Act. 

These cases are related to the Fieger v. Gonzales case currently pending 

in the Eastern District of Michigan, 

in which Geoffrey Fieger alleges 

that the Act grants the Commission 

exclusive jurisdiction over criminal 

violations and bars the Department 

of Justice from conducting any grand 

jury investigations unless and until 

the Commission makes a referral. See 

March 2007 Record.

Complaints

The plaintiffs made contributions 

to John Edwards’ 2004 presidential 

campaign. According to the complaints, the plaintiffs are being investigated by the Department of Justice 

for violations of the Act. Mr. Bialek 

was summoned before a grand jury 

in November 2006 and Mr. Marcus 

was summoned before a grand jury in 

October 2006. 

The plaintiffs assert that by giving 

“exclusive jurisdiction” over the Act 

to the Commission, Congress determined that no criminal investigation 

can take place unless the Commission 

has formally referred the criminal 

matters to the Attorney General. The 

plaintiffs claim that the Attorney 

General’s investigations are unlawful 

and unconstitutional since the Commission did not refer the plaintiffs’ 

alleged violations to the Attorney 

General.

In addition to those allegations, the 

Beam plaintiffs allege that Attorney 

Gonzales intentionally interfered 

with the Commission’s investigation 

and that the Commission’s failure to 

conduct its own investigation violates 

the Act and the Administrative Procedures Act.

Relief

The Bialek and Marcus complaints 

seek a declaration that the defendants’ actions are unlawful and the 

award of costs and attorneys’ fees. 

In addition to this relief, the Beam

complaint asks the court to declare 

the that the Commission has failed to 

uphold the Act and to issue a Writ of 

Mandamus requiring the Commission 

to conduct its own investigation into 

the matter prior to any investigation 

by the Attorney General.

Bialek v. Gonzales, U.S. District 

Court for the District of Colorado, 

07-CV-00321-WYD-PAL.

Marcus v. Gonzales, U.S. District 

Court for the District of Arizona, 

CV070398-PCT-EHC.

Beam v. Gonzales, U.S. District 

Court for the Northern District of Illinois, 07CV1227.

—Meredith Metzler

Advisory

Opinions

Advisory Opinion 2006-34:

Political Committee 

Sponsored Affinity Program

Working Assets may offer an 

affinity wireless telecommunication 

program to sponsoring political committees that would allow customers to 

direct a 10 percent rebate from their 

monthly charges as a contribution to 

the political committee sponsor (the 

sponsor). Customers would also have 

the option to “round-up” their bills 

and apply the excess amount as a 

contribution to the sponsor. 

The proposed program would not 

result in any impermissible corporate 

contributions under the Federal Election Campaign Act (the Act) because 

(i) the sponsors would pay the usual 

and normal charge for the solicitation services and other services 

provided by Working Assets as part of 

a commercial transaction and (ii) the 

contributions to the sponsors resulting 

from rebates and round-ups would be 

made by the individual customers and 

not by Working Assets.

Background

Working Assets, a for-profit corporation specializing in donation-linked 

telecommunications and credit card 

services, has offered affinity programs 

to non-profit organizations for over 

20 years. Under the programs, Working Assets donates a portion of each 

credit cardholder’s purchases or long 

distance or wireless charges to nonprofit organizations. The company 

also offers a program called “Citizen 

Action” in which bills sent to customers would contain “alerts” encouraging the customers to express their 

views on legislative and policy issues 

to elected and appointed officials. 

Working Assets proposes to 

expand its affinity sponsor programs to political party committees, 

nonconnected political committees 

(continued on page 6)

New Campaign Guide 

Available

 The 2007 Campaign Guide for 

Corporations and Labor Organizations is now available on the Commission web site at http://www.fec.

gov/info/publications.shtml. Paper 

copies will be available by May 2007.

 For each type of committee, a 

Campaign Guide explains, in clear 

English, the complex regulations 

regarding the activity of political 

committees. It shows readers, for 

example, how to fill out FEC reports 

and illustrates how the law applies to 

practical situations.

 Please contact the Information 

Division at 800/424-9530 to order 

paper copies.
Federal Election Commission RECORD April 2007

6

Advisory Opinions

(continued from page 5)

and qualified non-profit corporations 

(QNCs). The proposed affinity program would be made available without regard to political party affiliation 

or ideological orientation. However, 

the program for each particular sponsor would have to be commercially 

viable as determined by common 

commercial principles, such as size of 

membership and potential for longterm customer commitments.

The proposed program would 

allow Working Assets to use the 

sponsoring political committee’s 

name, trademark and supporter list in 

marketing Working Assets’ mobile 

phones and wireless services to the 

sponsor’s members and supporters, 

via direct mail and/or online communications. The marketing would 

include messages from the sponsor soliciting support. Some messages might refer to past elections or 

electoral results, but they would not 

refer to current or future elections or 

federal candidates. Working Assets 

would pay the cost of the marketing.

Working Assets would offer an 

automatic 10 percent rebate from 

monthly charges to their customers. 

When customers enrolled they could 

choose one of two options: (1) receive 

the rebate in the form of a credit on 

their next bill or (2) direct the rebate 

amount as a contribution to the sponsoring political committee.

Customers would also be given the 

option to “round up” their monthly 

billed amount and specify the rounded up portion as a contribution to the 

sponsor. In addition, Working Assets 

plans to expand its Citizen Action 

Alerts to political committee sponsors 

and to include advertising space with 

content created by the sponsors in 

customers’ bills.

Working Assets’ proposal details 

how contributions from customers 

would be made and forwarded. First, 

customers would be able to switch 

their option for use of the rebate at 

any time. Second, when customers 

authorize the forwarding of rebates 

as contributions, and when those opting to contribute pay their bills, they 

would be asked to provide their name, 

address, occupation and employer. All 

contributor information would be forwarded to the sponsor in time to meet 

the Act’s recordkeeping and reporting 

requirements. Rebates directed to the 

sponsors would be forwarded through 

an automated clearinghouse within 

24 hours of Working Assets’ receipt. 

Donation forms in the bills would 

have all disclaimers as required by 11 

CFR 110.11. 

Working Assets’ proposal also 

details how the program would be 

financed. The arrangement would be 

based on the sponsor giving Working 

Assets access to its member and supporter list in exchange for Working 

Assets’ solicitation of the individuals 

on the list to participate in the program. The full cost of marketing the 

program would exceed the fair market 

rental value of the list, but Working 

Assets asserts that only a portion of 

the marketing costs should be attributable to the sponsor based on the 

division of the wireless charges. Since 

individuals would receive a 10 percent rebate on their monthly charges 

that they may direct to the sponsoring political committee and Working 

Assets would retain 90 percent of the 

proceeds, the company proposed to 

allocate 10 percent of the marketing 

costs to the committee sponsor and 

90 percent to itself. Working Assets 

would ensure that the portion of the 

marketing costs attributable to the 

sponsor would not exceed the fair 

market rental value of the sponsor’s 

list.

In addition, the sponsor would pay 

Working Assets directly for any costs 

associated with processing the rebates 

or round-ups, transmitting contributions and forwarding contributor 

information. The sponsor would also 

pay for all space in the bills associated with the Citizen Action Alerts, 

all expenses related to customers’ 

Citizen Action phone calls to officials, 

and for sponsor advertising space in 

the customers’ bills.

Analysis

The Act and Commission regulations prohibit corporations from 

making contributions in connection 

with any federal election and prohibit 

federal candidates and committees 

from accepting such contributions. 

2 U.S.C. 441b(a). In several past 

advisory opinions, the Commission 

has permitted corporations to offer 

affinity programs, or programs similar 

to affinity programs, as long as the 

corporation and the political committee:

• Enter into a commercially reasonable transaction in which the committee pays the usual and normal 

charge for services rendered (AOs 

2003-16, 2002-7 and 1995-34); and

• Ensure that amounts contributed to 

committees are from the individual 

customer’s funds and not from 

corporate funds (AOs 2003-16 and 

1994-33).

Usual and Normal Charge. In 

order to determine if the proposed 

program would be commercially 

reasonable, the Commission considered whether the sponsors provided 

sufficient compensation, i.e., the 

usual and normal charge (including a reasonable profit) to Working 

Assets for the services that Working 

Assets would provide to them. See 

AOs 2004-19, 2002-7 and 1994-33. 

The Commission noted that, in contrast to solicitation services usually 

provided by commercial vendors to 

political committees, the marketing services provided by Working 

Assets would serve two distinct 

purposes: (i) the primary purpose of 

generating customers for Working 

Assets’ wireless service and (ii) the 

secondary purpose (which would be 

contingent on individuals subscribing 

to the wireless service) of generating 

contributions to the sponsor. Under 

such circumstances, the Commission 

concluded that the proposed allocation to the sponsors of 10 percent of 

the marketing costs reflects the usual 

and normal charge for the services 

being provided to the sponsors under 
April 2007 Federal Election Commission RECORD

7

Advisory Opinion 2007-2:

State Party Status for 

Arizona Libertarians

The Arizona Libertarian Party, 

Inc. (the Arizona Party), satisfies the 

requirements for state committee 

status.

Background

The Federal Election Campaign 

Act (the Act) defines a state committee as “the organization which, 

by virtue of the bylaws of a political party, is part of the official party 

structure and is responsible for 

the day-to-day operation of such 

political party at the State level, as 

determined by the Commission.” 2 

U.S.C. 431(15). 

In order for a committee to 

achieve state party committee status 

under FEC regulations, the Commission must first determine whether the 

party itself qualifies as a “political 

party” under the Act and Commission regulations. See AOs 2004-40 

the facts presented, and that Working 

Assets’ provision of such services in 

exchange for the use of the sponsor’s 

mailing list would not be a contribution to the political committee.

The Commission also approved 

of the proposal that the sponsor 

pay Working Assets directly for the 

expenses related to processing and 

transmitting contributor information 

and contributions and to the Citizen 

Action Alerts, and for advertising 

space in customers’ bills. The Commission concluded that the sponsor 

need not pay in advance for these 

services but must pay the usual and 

normal charge within a commercially 

reasonable period of time in the ordinary course of business. 

The Commission concluded 

that Working Assets would act as 

a commercial vendor in providing 

its services, and would not make or 

facilitate a corporate contribution to 

the sponsor. 11 CFR 114.2(b), (f)(1) 

and (f)(2)(i).

Customer Contributions. The 

Commission concluded that the 

provision of rebated and rounded-up 

amounts to sponsors would be contributions by the customers, rather than 

impermissible contributions by Working Assets through its customers. See 

2 U.S.C. 441f (prohibiting contributions in the name of another). First, 

the rebates and round-ups would 

occur in the ordinary course of Working Assets’ business as is evidenced 

by Working Assets agreements 

with other non-political sponsoring 

organizations. Second, the customers, 

not Working Assets, would control 

the disposition of rebates and roundups. See AO 2003-16. The Commission noted that Working Assets must 

ensure that it does not forward any 

funds to sponsors until Working Assets receives and deposits the customer’s bill payment, so a prohibited 

corporate advance does not result. 2 

U.S.C. 441(b)(a) and (b)(2); 11 CFR 

114.(a)(1).

Collection and Transmittal of 

Contributions. Working Assets proposes to forward contributions to the 

sponsors within 24 hours of Working 

Assets’ receipt of the bill payment. In 

addition, Working Assets must place 

the contributed amounts from rebates 

and round-ups in an account separate 

from its other accounts (i.e., a separate bank account for payments by 

check, or merchant account for credit 

card transactions) before transmittal 

to the sponsor, in order to avoid the 

commingling of corporate funds with 

contributions. Working Assets may 

set up one separate merchant account 

and one bank account for check payments for all of the sponsors, as long 

as the company maintains separate 

records for contributions to each 

sponsor. See AOs 2004-19, 2002-7, 

1999-22 and 1991-20. Contributions 

and contributor information must be 

forwarded to the sponsors within 10 

days of receipt if the contribution is 

over $50. 2 U.S.C. 432(b)(2)(B); 11 

CFR 102.8(b)(2).

Solicitations and Other Communications. Working Assets’ proposal 

states that the solicitations sent to 

prospective customers would not 

mention current or future elections 

or current federal candidates; this 

is consistent with AO 2003-16. In 

addition, the proposal explains that 

bills would include disclaimers. The 

appropriate disclaimer would be the 

disclaimer required for communications by political committees that are 

not authorized committees. See 11 

CFR 110.11(b)(3). Such disclaimers 

must also be included on all initial 

and follow-up solicitations.

Impact of Proposal on QNCs. 

Working Assets proposes to offer its 

affinity program to QNCs. QNCs1

 are 

non-profit 501(c)(4) corporations that 

may make independent expenditures 

and electioneering communications 

so long as they meet certain specified 

criteria at 11 CFR 114.10(c). One 

of the criteria is that the corporation 

has no persons who are offered or 

receive a benefit, such as a credit card 

or a training program, which would 

provide a disincentive to disassociate from the corporation based on the 

corporation’s position on a political 

issue. 11 CFR 114.10(c)(3)(ii). The 

Commission assumed that the services and rebates offered by Working 

Assets would not be dependent on an 

individual’s association with a QNC, 

and that an individual could continue 

to participate in the Working Assets 

program even if he discontinues his 

membership with the QNC. Therefore, the Commission concluded that 

a QNC would not lose its QNC status 

by becoming a sponsor.

Date Issued: February 9, 2007

Length: 9 pages.

—Carrie Hoback

1

 A QNC must also (1) have as its only 

express purpose the promotion of political 

ideas, (2) not engage in business activities, (3) have no shareholders or persons 

(other than employees and creditors) who 

are affiliated in such a way that they could 

have a claim on the corporation’s assets 

or earnings, and (4) not be established by 

a business corporation or labor organization, nor accept donations from such 

sources. See 11 CFR 114.10(c). (continued on page 8)
Federal Election Commission RECORD April 2007

8

Advisory Opinion 2007-3: 

Private Contributions Do

Not Preclude Public Funding

Senator Barack Obama’s 2008 

presidential campaign may solicit 

and receive private contributions for 

the general election, yet retain the 

option to refund those contributions 

and accept public financing if he 

receives his party’s nomination for 

President.

Background

Senator Obama’s principal campaign committee, Obama for America, (the Committee) has begun to 

solicit and receive private contributions for both the 2008 primary and 

general election campaigns. However, Senator Obama has indicated 

that he will consider accepting 

public financing for the general 

election campaign if the Republican 

candidate agrees or independently 

decides to accept public funding. 

Senator Obama proposes to 

deposit contributions designated for 

the general election in a separate 

account. Only the Committee’s treasurer and its chief operating officer 

will have access to the account. 

Funds in that account would not be 

commingled with funds from other 

accounts and would not be used 

for any purpose whatsoever, until 

Senator Obama decides whether to 

accept public funds. If he decides to 

accept public funds, he will return 

all of the general election contributions in full to the contributors.

Analysis

Major party nominees accepting 

public funds for the general election must certify that they have not 

accepted and will not accept any 

private contributions, with limited 

exceptions. 11 CFR 9003.2(a)(2).

Senator Obama’s proposal is 

similar to the permissible practice of fundraising for the general 

election by candidates for the U.S. 

House of Representatives and 

Senate who have not yet won their 

primary elections. While candidates 

and 2004-34. Secondly, the committee must satisfy the remaining 

requirements of state party committee status: (1) be part of the official 

party structure and (2) be responsible for the day-to-day operations 

of the political party at the state 

level. 2 U.S.C. 431(15) and 11 CFR 

100.14. To determine day-to-day responsibility for operations, the Commission considers both the bylaws 

of the committee and whether the 

committee has successfully placed a 

federal candidate on the ballot. See 

AOs 2004-40 and 2004-34. Gaining 

ballot access for a federal candidate 

is an essential element of qualifying as a political party. See 11 CFR 

100.15.

Analysis

The Arizona Party meets all of 

the requirements for state political 

committee status. The Commission previously determined that 

the Libertarian Party qualifies as a 

political party and that the Libertarian National Committee qualifies 

as a national party committee. See 

AOs 2002-14 and 1975-129. The 

Arizona Party demonstrated that it is 

part of the official party structure by 

submitting a letter from the Libertarian National Committee designating 

it as the national committee’s “sole 

affiliate” in the state of Arizona. 

Regarding the day-to-day operational responsibilities, the Arizona 

Party’s constitution and bylaws demonstrate activity equivalent to that of 

other committees that have qualified 

for state party committee status. See 

AOs 2004-40 and 2004-34. Finally, the Arizona Party successfully 

placed two federal House candidates 

on the ballot in 2006. Both candidates raised or spent in excess of 

$5,000 during their 2006 campaigns, 

thus satisfying the Act’s definition of 

“candidate” at 2 U.S.C. 431(2). 

Date Issued: March 9, 2007

Length: 4 pages

—Meredith Metzler

Advisory Opinions

(continued from page 7)

may raise funds prior to receiving the nomination of their party, 

if they do not participate in the 

general election they must refund 

all contributions designated for that 

election within 60 days from the 

date that such funds become impermissible. See 11 CFR 102.9(e)(3), 

103.3(b)(3), 110.1(b)(3)(i), (b)(5), 

110.2(b)(3)(i), (b)(5), and Advisory 

Opinion 2003-18. 

The Commission concludes that 

Senator Obama may solicit and 

receive contributions designated for 

the 2008 general election without 

waiving his eligibility to receive 

public funds for the general election under the facts presented in the 

advisory opinion request, in which 

(1) those funds are kept in a separate account, (2) only the committee 

treasurer and its chief operating officer will have access to the account 

and (3) the funds in the account will 

not be used for any purpose.

If Senator Obama opts to receive 

public financing for the general 

election, he must refund all contributions designated for the general 

election in full within 60 days after 

he certifies his eligibility to receive 

such funds with the Commission 

under 11 CFR 9003.2(a)(2). 

Any interest earned on funds 

in Senator Obama’s general election account must be disgorged to 

the U.S. Treasury within 60 days 

after Senator Obama certifies his 

eligibility to receive public funds 

under 11 CFR 9003.2(a)(2). However, interest earned may be used 

for bank or merchant fees related to 

that account. 

Date Issued: March 1, 2007

Length: 7 pages.

—Myles Martin
April 2007 Federal Election Commission RECORD

9

Advisory Opinion Requests

AOR 2007-4

Whether processing fees paid 

directly by a contributor to a vendor 

processing online credit card contributions for a federal political committee are considered a contribution 

(Atlatl, February 26, 2007)

AOR 2007-5

Whether a Congressional staffer 

may serve as state party chairman and solicit, direct or control 

nonfederal funds on behalf of the 

state party in his capacity as chairman (Erik Iverson, March 8, 2007)

Committees Fined and Penalties Assessed

Ada M. Fisher for Congress, October Quarterly 2004 $3,0001

Ada M. Fisher for Congress, 12-Day Pre-General 2004 $9001

Allegheny Energy, Inc. Federal PAC $500

Bi-County PAC (FKA Suffolk PAC) $385

Big Tent PAC $1,125

Citizens for Arlen Specter $5,200

Committee to Elect Bill Sinnott $1,800

Consolidated Edison Inc. Employees’ PAC $900

Constellation Brands Inc. PAC $3002

Direct Selling Association PAC $135

Gillespie for Congress $3201

Hastings for Congress $975

Kim Clark for Congress $220

Louise Slaughter Re-Election Committee $450

Maata for Congress Campaign Committee $1,7251

Michigan Doctors PAC – Michigan State Medical Society $900

Monroe County Democratic Committee, Year End 2005 $6,8751

Monroe County Democratic Committee, April Quarterly 2006 $6,875

Murray for Congress $900

Office of the Commissioner of Major League Baseball PAC $1,125

Oregon Republican Party $900

Ned Lamont for Senate $4,400

Pennachio for Pennsylvania $1,400

Regions Financial Corp. Committee on Government Affairs $5,5001

Republicans for Choice PAC $6,8751 2

San Antonio Police Officers Association PAC $5,625

Serrano for Congress $900

Washington State Democratic Central Committee $15,0002

Wegner for Congress $160

Zanzi for Congress $1,400

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 for 

Nonfiled and Late Reports

The Commission recently 

publicized its final action on 30 

new Administrative Fines cases, 

bringing the total number of cases 

released to the public to 1,342 with 

$1,838,171 in fines collected by the 

FEC.

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 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 

Administrative

Fines

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.

—Meredith Metzler
Federal Election Commission RECORD April 2007

10

Washington, DC Conferences

The Commission will hold conferences for various types of committees 

this spring in Washington, DC. At the 

conferences, Commissioners and staff 

conduct a variety of technical workshops on federal campaign finance 

law designed for those seeking an 

introduction to the basic provisions 

of the law as well as for those more 

experienced in campaign finance law. 

April 24-25 Conference for 

Corporations and their PACs

The Commission will hold a 

conference for corporations and 

their political action committees 

on April 24 and 25, 2007, at the M 

Street Hotel, near the Georgetown 

and Foggy Bottom neighborhoods. 

Attendees are responsible for making their own hotel reservations. A 

room rate of $235 (single/double) 

is available for hotel reservations 

made by April 2. Call 1-888-803-

1298 or visit http://mariott.com/

hotels/travel/wasrw-m-street-hotel/

?groupCode=fecfeca&app=resvlink

to make your reservations. To receive 

this special rate, you must book 

online through the above address or 

must notify the hotel that you are 

attending the FEC campaign finance 

laws conference. The hotel is located 

within walking distance from both 

the Dupont Circle and Foggy Bottom subway stations. Valet parking 

is available for $28 per night. (Note: 

Please do not finalize your travel 

reservations until you have received 

confirmation of your registration for 

the conference from our contractor, 

Sylvester Management Corporation.)

The registration fee is $450 if 

received by March 30. A late registration fee of $25 will be added to 

registrations received after that date. 

Registrations are limited to two attendees per organization. Early registration is highly recommended, as this 

conference has previously sold out. 

For additional information, or to regOutreach

Party Financial Activity

Between January 1, 2005, and 

December 31, 2006, federal committees of the two major political 

parties raised and spent nearly $1.1 

billion. Republican national, state 

and local party committees raised 

$602.3 million in federally permissible “hard money” during 2005-

2006. Democratic party receipts 

totaled $483.1 million for the same 

period. Compared to 2002, the last 

election cycle without a Presidential 

election, Democratic receipts more 

than doubled and Republican receipts 

increased by 42 percent.

The national committees’ 

fundraising totals nearly equaled 

the 2002 election cycle totals, 

which was the last year that national 

party committees could raise “soft 

money.” National party committees 

are now restricted to only federal 

“hard money” contributions. For the 

2005-2006 cycle, individuals could 

contribute up to $26,700 to a national 

party committee and multicandidate 

PACs could contribute up to $15,000. 

Contributions from corporations and 

labor organizations are prohibited. 

Party spending also increased substantially in 2006. Democratic party 

committees reported making $108.1 

million in independent expenditures, 

with the Democratic Congressional 

Campaign Committee making $64.1 

million of those expenditures on 

House candidates. Republican party 

committees reported $115.6 million 

in independent expenditures with 

the National Republican Campaign 

Committee making $82.1 million of 

the total expenditures. Independent 

expenditures advocate the election or 

defeat of a federal candidate but are 

not coordinated with the candidate’s 

campaign. According to the committees’ reports, approximately 85 

percent of the independent expenditures made by both national parties 

advocated the defeat of opposing 

candidates.

Staff Director Testifies on 

Senate E-Filing

On March 14, 2007, FEC Staff Director Patrina Clark testified at a hearing before the Senate Committee on 

Rules and Administration concerning 

electronic filing of Senate campaign 

finance reports. Senate committees 

are the only filers not permitted to file 

their official FEC reports electronically. Electronic filing is an option for 

all other committees, and is mandatory for those with more than $50,000 

of activity in a calendar year. 

For many years, the Commission has included in its legislative 

recommendations a proposal to 

require electronic filing for Senate 

committees that exceed the $50,000 

threshold. As Ms. Clark noted in her 

testimony, electronic filing speeds 

disclosure and is more efficient for 

committees, the Commission and the 

public. Ms. Clark also assured committee members that the agency’s existing electronic filing infrastructure 

would be sufficient to handle Senate 

filings, should Congress amend the 

law to offer that option.

Information

Statistics Democratic committees spent 

$20.7 million on coordinated expenditures while Republican committees 

spent $14.2 million. Coordinated 

expenditures, unlike independent expenditures, are subject to limitations. 

Additional information on party 

committee activity is available in a 

press release dated March 7, 2007. 

The release includes detailed tables 

showing the sources of receipts 

for national party committees and 

financial overviews for national and 

state/local committees of the two major parties for the 2005-2006. Transfers from national to state parties are 

listed by state, as well as transfers 

from campaigns to parties. The press 

release is available on the FEC web 

site at http://www.fec.gov/press/press.

shtml. 

—Meredith Metzler
April 2007 Federal Election Commission RECORD

11

Advisory Opinions

2006-33: Association May Compensate State Affiliate Collecting 

Agents, 2:6

2006-34: Political Committee Sponsored Affinity Program, 4:5

2006-35: Legal Fees Paid with Campaign Funds, 3:4

2006-36: Green Senatorial Committee 

Gains National Party Status, 3:5

2006-37: Campaign May Reimburse 

Candidate for Misreported Loans, 

3:6

2006-38: Officeholder’s Use of State 

Campaign Funds, 3:7

2007-2: State Party Status for Arizona 

Libertarians, 4:7

2007-3: Private Contributions Do Not 

Preclude Public Funding, 4:8

Compliance

527 Organizations Pay Civil Penalties, 1:1

Administrative Fine Update, 4:9

Comments Sought on Proposed Probable Cause Hearings, 1:5

Comments Sought on Sua Sponte

Proposal, 1:5

MUR 5487: Progress for America 

Voter Fund, 4:1

MURs 5511 and 5525: Swift Boat 

Veterans and POWs for Truth, 1:3

MUR 5634: Express Advocacy Leads 

to Prohibited Corporate Expenditure, 1:4

The first number in each citation refers to the numeric month of 

the 2007 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 four.

Index

MUR 5753: League of Conservation 

Voters 527 I and II, 1:3

MUR 5754: MoveOn.org Voter Fund, 

1:4 

Policy Statement on Initial Stage of 

Enforcement Process, 4:3

Policy Statement on Reporting of 

“Purpose of Disbursement”, 2:5

Policy Statement Establishing Probable Cause Hearings, 3:1

Court Cases

______ v. FEC

– CREW, 2:3

– Unity ‘08, 2:4

– Wisconsin Right to Life, 2:1

Bialek v. Gonzales, Marcus v. Gonzales, Beam v. Gonzales, 4:5

Fieger v. Gonzales, 3:3

Information

2007-2008 Contribution Limits, 2:1

Coordinated Party Expenditure Limits 

for 2007, 3:9

Reporting Notices Enter the Electronic Age, 2:7; 3:10

Staff Director Testifies on Senate EFiling, 4:10

Telephone Excise Tax Refunds, 1:11

Outreach

Conferences Scheduled for 2007, 3:10

Roundtable Workshops, 4:12

Washington, DC Conference for Corporations and SSFs, 3:10, 4:10

Washington, DC Conference for 

House and Senate Campaigns and 

Political Party Committees, 4:11

Regulations

2007 Rulemaking Priorities, 4:4

Proposed Rules and Policy Statement 

on Best Efforts, 1:6

Supplemental E&J on Political Committee Status, 3:1

Reports

April Reporting Reminder, 4:1

Reports Due in 2007, 1:7

Staff

General Counsel and Deputy Resign, 

2:6

Statistics

Party Financial Activity, 4:10

ister for the conference, please visit 

the conference web site at http://www.

fec.gov/info/conferences/2007/corporate07.shtml.

May 10-11 Conference for House 

and Senate Campaigns and 

Political Party Committees 

The Commission will hold a conference for campaigns and political 

party committees on May 10 and 11, 

2007, at the Hyatt Regency Washington on Capitol Hill. Attendees are 

responsible for making their own hotel reservations. A room rate of $225 

(single) or $254 (double) is available 

for hotel reservations made by April 

16. Call 1-800-633-7313 to make 

your reservations or visit http://washingtonregency.hyatt.com/groupbooking/wasrwfeec2007. To receive this 

special rate, you must book online 

through the above address or must 

notify the hotel that you are attending the FEC campaign finance laws 

conference. Valet parking is available for $33 per night. The hotel is 

walking distance from Union Station 

(served by Amtrak, MARC and VRE 

commuter rail and Metro subway); 

public transportation is recommended. 

(Note: Please do not finalize your 

travel reservations until you have 

received confirmation of your registration for the conference from our 

contractor, Sylvester Management 

Corporation.)

The registration fee is $450 if received by April 13. A late registration 

fee of $25 will be added to registrations received after that date. Early 

registration is highly recommended, 

as this conference has previously sold 

out. For additional information, or 

to register for the conference, please 

visit the conference web site at http://

www.fec.gov/info/conferences/2007/

cand-party07.shtml.

More Information

Please direct all questions about 

conference registration and fees to 

Sylvester Management Corporation 

at 1-800/246-7277 or by e-mail to 

tonis@sylvestermanagement.com. For 

questions about the conference program, or to receive e-mail notification 

of upcoming conferences and workshops, call the FEC’s Information 

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

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

e-mail to Conferences@fec.gov.

—Dorothy Yeager
Federal Election Commission RECORD April 2007

PRESORTED STANDARD

U.S. POSTAGE

PAID

FEDERAL ELECTION COMMISSION

FEDERAL ELECTION COMMISSION 

999 E Street, NW

Washington, DC 20463

Official Business

Penalty for Private Use, $300

Roundtable Workshops:

On April 11, 2007, the FEC’s Public Records Office will host a free workshop on the agency’s new on-line Advisory Opinion 

(AO) Search System. The workshop will provide a hands-on introduction to the system and one-on-one help with the new 

search functions. Attendees will also explore the advanced search tools and gain insight on how to use key words and 

symbols to find information quickly. 

To register for the workshop, visit the FEC web site at http://www.fec.gov/info/outreach.shtml#roundtables or call the FEC 

Information Division at 1-800-424-9530 (press 6) or locally at 202/694-1100. Attendance is limited to 15 people per session, 

and registration is accepted on a first-come, first-served basis. 

Date & Time Subject Intended Audience

Wednesday, 

April 11, 2007

10:00 a.m.

Using the New On-Line Advisory Opinion 

Search System

Open to the Public

Wednesday, 

April 11, 2007

1:00 p.m.

Using the New On-Line Advisory Opinion 

Search System

Open to the Public

To register, contact the FEC at 800/424-9530 (press 6) 

or visit http://www.fec.gov/info/outreach.shtml#roundtables.

Sold Out!