Federal 

Election 

Commission 

Annual Report 1985 

Federal Election Commission 

Washington, D.C. 20463 
Commissioners 

Joan D. Aikens, Chairman 

John Warren McGarry, Vice Chairman 

Lee Ann Elliott 

Thomas E. Harris 

Thomas J. Josefiak 

Danny L. McDonald 

Ex Officio Commissioners 

Jo-Anne L. Coe, Secretary of the Senate 

Benjamin J. Guthrie, Clerk of the House 

Statutory Officers 

John C. Surina, Staff Director 

Charles N. Steele, General Counsel 

The Annual Report 1985 was written and published by the 

Commission's Office of Publications. 
FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20463 

June 1, 1986 

The President of the United States 

The u.s. Senate 

The u.s. House of Representatives 

Dear Sirs: 

We submit for your consideration the eleventh annual report 

of the Federal Election Commission, as required by the 

Federal Election Campaign Act of 1971, as amended. The 

Annual Report 1985 describes the activities performed by 

the Comm1ss1on 1n carrying out its duties under the Act. 

It also includes a number of legislative recommendations 

adopted by the Commission in March 1986. 

Respectfully, •

r {j, aJu....J 

Joan D. Aikens 

Chairman 
Table of Contents 

Page 

Introduction 1 

Chapter 1 

Presidential Public Funding 3 

Overview 3 

Supreme Court Ruling on Expenditures 3 

Public Funding Payments 4 

Audits and Repayments 5 

Chapter 2 

Administration of the Law 7 

Disclosure 7 

Regulations 9 

Assistance to Committees 11 

Review of Reports 12 

Enforcement 12 

Legallssues 14 

Clearinghouse on Election Administration 22 

Chapter 3 

Campaign Finance Statistics 25 

Chapter 4 

The Commission 33 

Commissioners 33 

Administrative Activities 33 

The Commission's Budget 35 

Personnel and Labor Relations 36 

Chapter 5 

Legislative Recommendations 37 

Appendices 

1. Biographies of Commissioners and 

Officers 51 

2. Chronology of Events, 1985 55 

3. FEC Organization Chart 59 

4. FEC Offices 61 

5. Statistics on Commission Operations 65 

6. The FEC's Budget 69 

7. Computer Indexes 71 

8. Clearinghouse Studies 75 

9. FEC Federal Register Notices, 1985 77 
Introduction 

During 1985, the Commission carried out its 

responsibility for administering and enforcing the 

Federal campaign finance law. Much of the agency's activity stemmed from the 1984 electionsfor example, working on the required audit reports 

on publicly funded campaigns; releasing campaign finance studies on the 1983-84 election cycle; and processing enforcement cases arising 

from the previous year's election activity. 

This report examines the Commission's administration of the law in Chapters 1 and 2, and 

presents extensive campaign finance statistics in 

Chapter 3. The agency's internal operations are 

summarized in Chapter 4, and Chapter 5 lists the 

Commission's recommendations for legislative 

change. Several appendices provide supplemental information. 
3 

Chapter 1 

Presidential Public Funding 

Overview 

The major elements of the public financing program have remained largely the same since the 

first publicly financed Presidential elections in 

1976. Basically, public funding encompasses: 

• Matching funds for Presidential primary candidates who have met qualification requirements; 

• Grants to sponsor Presidential nominating 

conventions of political parties; and 

• Full grants for the general election campaigns of major party nominees and partial 

grants for qualified minor and new party 

nominees. 

The financing for the public funding program 

comes from the Presidential Election Campaign 

Fund. This Fund consists of dollars checked off 

by taxpayers on their Federal income tax returns. 

The checkoff neither increases the amount of 

taxes owed nor decreases any refund due. 

The FEC has overseen the public financing of 

three Presidential elections-1976, 1980 and 

1984-and has certified a total of $309 million in 

payments to 43 candidates and 6 Democratic and 

Republican nominating convention committees. 

Payments were made by the U.S. Department of 

Treasury. 

This chapter opens with a summary of a 1985 

Supreme Court decision affecting the public funding law and continues with a review of the Commission's certification of public funds. The 

chapter goes on to discuss several issues related 

to the repayment of public funds. See Chapter 3 

for campaign finance statistics on Presidential 

campaigns. 

Supreme Court Ruling on 

Expenditures 

On March 18, 1985, the Supreme Court ruled that a 

provision of the campaign finance law was unconstitutional, thus resolving an issue that had 

been pending since 1980. 

Section 9012(f) of the Presidential Election 

Campaign Fund Act (26 U.S.C.) placed a $1,000 

limit on expenditures made by political committees to further the general election of publicly 

financed Presidential nominees. The provision 

was first found unconstitutional in September 

1980 by the U.S. District Court for the District of 

Columbia. The Commission appealed this decision to the Supreme Court. In January 1982, the 

High Court split four to four (with Justice Sandra 

O'Connor not participating), leaving the constitutionality of Section 9012(f) unresolved. 

The debate resumed in 1983. In an effort to obtain a decisive ruling by the Supreme Court, the 

FEC filed suit against the National Conservative 

Political Action Committee (NCPAC) and the Fund 

for a Conservative Majority (FCM). These two 

committees had allegedly planned to spend large 

sums on independent expenditures1 benefiting 

President Reagan's 1984 general election campaign, which was publicly financed (FEC v. 

NCPAC and FCM). The FEC's suit was consolidated with a second suit, Democratic National 

Committee (DNC) v. NCPAC, which had been filed 

in May 1983. The Commission had intervened in 

that suit as a defendant, arguing that the 

Democrats lacked standing to bring the action. In 

the consolidated suits, the FEC and the DNC 

asked that a three-judge panel of the U.S. District 

Court for the Eastern Division of Pennsylvania 

find that Section 9012(f) prohibited NCPAC and 

'An independent expenditure is an expenditure for a com· 

munication expressly advocating the election or defeat of a 

clearly Identified candidate that is not made with the coopera· 

tion or prior consent of, or in consultation with, or at the re· 

quest or suggestion of, any candidate or his or her authorized 

committees or agents. 
4 

FCM from making expenditures of over $1,000 on 

behalf of the Republican nominee. The Commission also asked the court to rule that Section 

9012(f) was constitutional. 

In 1983, the Pennsylvania district court ruled 

that Section 9012(f) was unconstitutional on its 

face because it violated First Amendment rights 

of free speech and association. The court also 

found that the Democrats had standing to bring 

suit. Again, the Commission appealed. 

The Supreme Court brought the issue to a close 

by affirming the district court's decision on the 

unconstitutionality of Section 9012(f). The Court 

concluded that: 

Section 9012(f)'s limitation on independent 

expenditures by political committees is constitutionally infirm, absent any indication 

that such expenditures have a tendency to 

corrupt or to give the appearance of corruption. But even assuming that Congress could 

fairly conclude that large-scale political action committees have a sufficient tendency 

to corrupt, §9012(f) is a fatally overbroad 

response to that evil. It is not limited to 

multimillion dollar war chests, but applies 

equally to informal discussion groups that 

solicit neighborhood contributions to 

publicize views about a particular Presidential candidate. 

At the same time, the Court reversed the lower 

court's ruling that the Democrats had standing to 

bring suit. The Supreme Court noted that, while 

the Fund Act authorizes the Democratic National 

Committee to bring suit against the Commission, 

its suit against private parties "to construe or enforce the Act [was] inappropriate interference" 

with the FEC's "responsibilities for a~ministering 

and enforcing the Fund Act." 

Public Funding Payments 

The Commission certifies Federal funds to 

Presidential candidates and committees that 

have met eligibility qualifications. The table 

below shows the amount of public funds the Commission certified for the three publicly funded 

Presidential elections. The maximum amount of 

matching funds a primary candidate could receive 

was $10 million dollars, adjusted for inflation (i.e., 

half of the national spending limit).2 The 

nominating convention committees of the major 

parties were entitled to a base grant of $2 million 

in 1976, an amount that Congress increased to $3 

million in 1980 and $4 million in 1984. For each 

year, the base entitlement was augmented by a 

cost-of-living adjustment. The entitlement for major party nominees-$20 million-was also adjusted for inflation. 

Public Funding Certifications for the 1976, 1980 

and 1984 Presidential Elections (in millions) 

Recipient 1976 1980 1984 

Primary Candidates* $24.8 $ 31.3 $ 36.5 

Party Convention Committees 4.1 8.8 16.2 

General Election Candidates 43.6 63.1** 80.8 

Totals $72.5 $103.2 $133.5 

*There were 15 primary matching fund recipients in 1976, 

10 in 1980 and 11 in 1984. 

**Three nominees received public funding in 1980-the two 

major party nominees and John Anderson, who qualified as a third 

party candidate eligible to receive partial public funding. 

20nly one candidate-President Reagan, in his 1984 

primary campaign-received enough matchable contributions 

to qualify for the maximum amount of matching funds. 
5 

Looking ahead to 1988, the Commission anticipates a much heavier demand on both the 

Presidential Fund and agency staff. That year's 

Presidential election will be the first under the 

public funding provisions in which there will be no 

incumbent President running for reelection. This 

should dramatically increase the number of 

primary candidates qualifying for matching funds. 

Audits and Repayments 

The campaign finance law requires the Commission to audit all public funding recipients to ensure that Federal funds are spent in compliance 

with the law. If they are not, a campaign or convention committee may have to repay public 

funds to the Treasury. 

By the end of 1985, the Commission had publicly released several of the audit reports on the 

Presidential primary campaigns and party convention committees. As a result of these audits, 

the Commission had requested the return of 

$217,048 in public funds, of which $42,227 was 

returned to the U.S. Treasury by the end of 1985. 

(In addition, campaigns made repayments of 

$374,489 which were not based on audit reports. 

In two cases, campaigns voluntarily returned 

funds before the release of the audit reports; a 

third repayment resulted from the resolution of a 

compliance matter.) Audits of the remaining 

public funding recipients were approaching completion by the year's end. As circumstances warrant, the Commission will issue addenda to completed reports based on follow-up audit fieldwork 

and repayment determinations. 

New Regulations on 

Repayment of Public Funds 

In 1985, the Commission revised its regulations 

on the repayment of matching funds as a result of 

a 1984 appeals court ruling. In Kennedy for President Committee v. FEC and Reagan for President 

Committee v. FEC, the two primary campaigns 

had challenged the repayment formula then contained in Commission regulations. The formula 

had required repayment of the entire amount of 

nonqualified campaign expenses incurred by a 

campaign. In May 1984, the U.S. Court of Appeals 

for the District of Columbia Circuit held that the 

Commission's statutory authority limited the 

agency's repayment determinations to a 

reasonable estimate of the amount of Federal 

funds used for nonqualified campaign expenses. 

To make its regulations consistent with the 

court's decision, the Commission drafted revised 

rules on the repayment of public funds (11 CFR 

9007 and 9038). These new rules were published in 

the Federal Register on March 8, 1985 (50 Fed. 

Reg. 9421) and prescribed on June 26, 1985. (For a 

summary of the regulations, see page 13 of the 

1984 Annual Report.) 

In July 1984, nearly a year before the regulations were prescribed, the Commission recalculated the Reagan and Kennedy repayments based 

on the new formula. As a result, the agency 

refunded part of the 1980 Reagan campaign's 

repayment and reduced the amount owed by the 

Kennedy campaign. The Commission decided not 

to reconsider repayment determinations it had 

made with regard to five other 1980 primary campaigns. One of the committees affected, the 

CarteriMondale Presidential Committee, asked 

the Commission to reconsider its decision and, 

when the agency declined to do so, filed a court 

appeal (see below). 

CarteriMondale Presidential 

Committee v. FEC 

On November 1, 1985, the U.S. Court of Appeals 

for the District of Columbia Circuit ruled that the 

FEC did not abuse its discretion in declining to 

reconsider a repayment determination regarding 

the CarteriMondale Presidential Committee. 

In a previous petition for review, filed in 1982, 

the CarteriMondale Committee had asked the appeals court to review the FEC's determination 

that the Committee repay $104,300 in matching 

funds to the Treasury. The court dismissed the 

case on the grounds that it had not been filed 
6 

within the time frame required by the campaign 

finance law. 

In its 1985 decision, the court rejected the Committee's assertion that the agency had treated it 

unfairly and stated: "No favoritism can be at· 

tributed to the FEC when it carries out the letter of 

a court's order" to reconsider the Kennedy and 

Reagan campaigns' repayments. Nor did the 

court find merit in the Committee's argument that 

the FEC had failed to give reasons for refusing to 

reopen its repayment determination. The court 

said that the reasons behind the Commission's 

actions "may be gleaned from its staff's 

reports."The court also pointed out that the Committee was not in the same position as the Kennedy and Reagan Committees because of its tardiness in filing its original petition seeking court 

review of the repayment determination. 

Candidate's Salary as Nonquallfied 

Campaign Expense 

In April 1985, the Commission held a hearing at 

which the 1984 Presidential primary campaign of 

former Senator George McGovern appealed an 

FEC determination that salary payments of 

$50,000 to Mr. McGovern constituted nonqualified 

campaign expenses and that the campaign was 

thus required to repay a pro rata portion ($13,549). 

The campaign argued that the salary payments 

constituted a qualified campaign expense 

because "Senator McGovern's personal financial 

situation is such that he would not have been able 

to run for the Presidency without the payments." 

The McGovern campaign further contended that 

Congress had "consciously made the determination in the Federal Election Campaign Act, to 

leav~ the decision how to spend money in a 

political campaign to the candidates themselves, 

not to the Commission or its staff." 

In June, the Commission rejected the 

McGovern campaign's position, stating: 

To argue that a candidate may take public 

funds for his or her personal benefit does not 

comport with the fundamental purpose 

underlying the Matching Payment Account 

Act, i.e., to help defray the campaign costs in· 

curred by eligible candidates in seeking their 

party's nomination for the office of President. 

Mondale for President Committee v. FEC 

In February 1985, the Commission determined 

that "a potential repayment obligation should not 

be the basis for entitlement to further public 

monies...." This determination was in response 

to the Mondale for President Committee's request 

for matching funds to cover a "contingent liabili· 

ty"-a potential debt resulting from matching 

fund repayments the Commission might later require. After considering an appeal from the Committee, the Commission reaffirmed its position in 

May 1985 and again rejected the Mondale request 

for additional matching funds to cover the contingent liability. 

On June 7, 1985, the Committee asked the U.S. 

Court of Appeals for the District of Columbia Cir· 

cult to require the FEC to certify the full amount of 

matching funds requested by the Committee, in· 

eluding the contingent liability. At the end of 1985, 

the case was still pending. 
7 

Chapter 2 

Administration of the Law 

This chapter first reviews the Commission's progress in making campaign finance information 

more widely available. (See also the campaign 

finance statistics presented in Chapter 3.) The 

chapter then examines the 1985 activities of other 

FEC programs and goes on to summarize court 

decisions and advisory opinions that clarified 

areas of the Federal campaign finance law. The 

chapter closes with a description of the activities 

of the Clearinghouse on Election Administration. 

Disclosure1 

In 1985, the Commission enhanced its disclosure 

of campaign finance information by utilizing computer technology on a larger scale than ever 

before. 

With thousands of campaign finance reports 

flowing into the FEC each reporting period, the 

agency relies on the computer to store and 

organize data taken from the reports. As required 

by law, copies of the reports are made available to 

the public within 48 hours. During this same time 

period, summary data from the reports are coded 

and entered into the FEC's computer system. The 

agency processed 64,000 documents in this way 

during fiscal year 1985. 

In a second step, many of the detailed transactions disclosed on reports are coded and entered 

into the computerized data base. While this process takes longer than entry of summary information, during fiscal year 1985 the Commission captured detailed data from 43,000 documents within 

a median time of 30 working days. 

To share this wealth of information, the Commission expanded a program begun in 1984 and 

developed a new program to make computerized 

information available to people throughout the 

country. More detail is provided below. 

In addition to new projects, the Commission's 

1985 disclosure activity included the release of 

final statistical reports on the 1983-84 election cycle and companion computer tapes. The agency 

also continued to assist the press and the public 

with their research. 

State Access to Computerized Data 

With the addition of three sites, the Commission 

expanded its program to provide computerized access to FEC campaign finance information in 

State election offices. The new cities-Mont· 

gomery, Alabama; Lansing, Michigan; and Providence, Rhode Island-brought the number of 

State offices with FEC computer access to 10.2 

The primary objective of this program, begun in 

1984, was to give those located outside 

Washington, D.C. immediate access to several 

standard FEC computer indexes. (FEC indexes 

are described in Appendix 7.) A computer terminal 

located in the State election office was linked, 

through a national telecommunications system, 

to a computer storing FEC data. 

The program benefited local citizens in several 

ways. The FEC computer indexes offered data on 

Federal candidates and political committees 

throughout the country. (State files, by contrast, 

contain data only on candidates and committees 

active in that State.) Additionally, the computer indexes greatly reduced the need to copy information from the reports themselves. For these 

reasons-and considering the agency's substantial investment in maintaining its computerized 

data base, regardless of whether data access was 

shared-the Commission believed that the in· 

cremental expense of the State access program 

was well justified. On the average, the Commission spent $4,000 a month to cover technical re-

'Prompted by the mandatory cuts resulting from the 

Gramm/Rudman/Hollings Act, on March 1, 1986, the Commission was forced to cut, among other programs, its disclosure 

program by reducing the comprehensiveness, timeliness and 

accuracy of dissminated information. At the time of publication, therefore, the disclosure program was substantially 

reduced from the description provided on these pages. 

2The first sites with computer access were: Los Angeles 

and Sacramento, California; Denver, Colorado; Atlanta, 

Georgia; Chicago, Illinois; Boston, Massachusetts; and Olym· 

pia, Washington. 
8 

quirements, computer time and telecommunications expenses. Each State office provided the 

local computer hardware. Since the specifications for a usable terminal were not rigid, States 

were free either to select new equipment or to use 

existing terminals or personal computers. 

A 1985 report on a survey of State participants 

concluded that the State access program gave 

the Federal government an efficient means of 

disseminating campaign finance information and, 

at the same time, provided State governments 

with a new resource for local researchers. During 

the period covered by the survey, most States 

reported that the computer access program 

generated more visitors-as many as 40 percent 

more in some States. As to the information requested, State offices reported that the availabili· 

ty of printouts on PACs virtually replaced the demand for paper copies of PAC reports. By contrast, researchers still continued to request paper 

files of candidate reports because computerized 

data did not include an index on individual contributors to candidates' campaigns. In response, 

the agency added another computer index in 

1985, the G Index, which lists individual contributors of $500 or more. The Commission also 

included data on the 1985-86 election cycle, in addition to the 1983-84 cycle. A 1985 FEC brochure, 

State Computer Access to FEC Data, which explained the information available, was distributed 

to the State terminal sites. 

Direct Computer Access 

In another effort to enhance the FEC's disclosure 

program, in September 1985, the agency inaugurated a subscription service that provided individuals with direct computer access to the FEC 

campaign finance disclosure base. Using the 

same telecommunications network that services 

the State computer access project, the direct, online access program allowed individuals and 

organizations with personal computers to call up 

any of the computer indexes available in the State 

program. In addition, users could request raw 

data, which they could store and then arrange according to their own research needs. 

This new service was offered under the 

Freedom of Information Act (FOIA). Persons 

wishing to subscribe to the service submitted 

their requests to the FOIA officer. Instead of paying the FEC for computer time spent on line, the 

subscriber paid the Commission's computer vendor directly. By the year's end, 15 subscribers had 

signed up for the service. 

Campaign Finance Studies 

Each election cycle, the Commission publishes 

Reports on Financial Activity, which present summary data in a variety of formats. After issuing 

numerous Interim Reports in 1984, the Commis· 

sion completed the series with the publication of 

the Final Reports on the 1983-84 cycle, covering 

independent expenditures, House and Senate 

campaigns and noncandidate committees. The 

Final Reports reflected amendments committees 

had made to their previously filed reports. Both 

the Interim and Final Reports on House and 

Senate campaigns provided more detail on 

sources of campaign funding than had previous 

studies. Commission press releases highlighted 

information contained in the studies through 

statistical tables and computer-produced charts. 

Soon after it released the Final Reports on Finan· 

cia/ Activity, the agency also made available for 

purchase companion computer tapes. 

Serving the Public 

The Commission's Public Records Office and 

Press Office respond to the needs of the public 

and the press for information on Federal campaign finance. 

The Public Records Office maintains paper and 

microfilmed copies of campaign finance reports 

and other research documents. In addition, the of· 

flee handles orders for computer indexes, copies 

of reports and other materials. Working with the 

public in person or on the toll-free line, office staff 

help researchers locate the information they 

need. By using a new printiog method in 1985, the 
9 

Commission cut in half the purchase price of its 

most popular computer indexes, such as the 

multicandidate committee index. During calendar 

year 1985, the office provided 78,805 printouts to 

the public. 

The Press Office responds to requests from 

callers and visitors representing the media. Office 

staff issue press releases on Commission activities and campaign finance statistics; prepare 

press packets; schedule interviews; and make arrangements for television crews covering the 

agency. The office also handles requests made 

under the Freedom of Information Act. In 1985, the 

office received 8,326 phone calls and 1,354 

visitors, issued 147 press releases and responded 

to 135 requests made under the Freedom of Information Act. 

Regulations 

In addition to its disclosure duties, the Commission is also required to develop regulations that 

implement the Federal Election Campaign Act. 3 ln 

1985, the agency continued to work on revisions 

to the regulations with the goal of providing more 

guidance on the actual practices of political committees. 

Testing the Waters 

On March 8, 1985, the Commission transmitted to 

Congress revised rules governing "testing-thewaters" activities. Under the campaign finance 

law, a person must register as a "candidate" once 

campaign activity exceeds $5,000. FEC regulations, however, provide limited exceptions to this 

automatic threshold. The exceptions permit an individual to test the feasibility of a campaign for 

Federal office without becoming a "candidate." 

Commonly referred to as "testing-the-waters" exceptions, the rules exclude from the definitions of 

"contribution" and "expenditure" funds received 

and payments made to determine whether an individual should become a candidate (11 CFR 

100.7(b)(1 ), 100.8(b)(1) and 101.3). The proposed 

revisions to the testing-the-waters rules were 

published in the March 13, 1985, Federal Register 

(50 Fed. Reg. 9992) and became effective on July 

1, 1985 (50 Fed. Reg. 25698). 

One major change from the previous rules is 

that the contribution limits and prohibitions of the 

law now apply to funds used to test the waters, 

regardless of whether the individual eventually 

becomes a candidate. 

Like the previous regulations, the new rules 

limit testing-the-waters activities to those which 

evaluate a possible candidacy, such as 

disbursements for opinion polls and travel undertaken to determine whether an individual should 

run for Federal office. The revised rules include 

new examples of activities which indicate an individual has decided to become a candidate and 

which therefore are not considered testing-thewaters activities: obtaining ballot access; making 

campaign statements that refer to the individual 

as a candidate; or conducting activity shortly 

before an election or over a protracted period of 

time. 

Contribution Limits 

The Commission sought comments on proposed 

revisions to its regulations governing contribution 

limits (11 CFR 110.1 and 110.2) in an April17, 1985, 

Federal Register notice (50 Fed. Reg. 15169). The 

notice addressed a variety of problems related to 

the administration of the statutory contribution 

limits and asked for public comment on numerous 

possible changes to the regulations that might 

resolve the problems. 

The agency received several written comments 

in response to the notice and, on October 16, 

1985, held a public hearing. Although the agency 

received three requests to appear at the hearing, 

3ln addition to the regulatory work described in this sec· 

tion, the Commission prescribed revisions to the regulations 

on the repayment of public funds (page 5) and asked for public 

comment on possible changes to the rules governing compliance procedures (page 14). The agency also prescribed new 

rules implementing the Sunshine Act and published proposed 

rules on standards of conduct for FEC employees (page 34). 
10 

only one witness, a representative from the U.S. 

Chamber of Congress, actually testified. 

The Commission considered both wri.tten and 

oral comments in December, when it discussed 

different approaches that might be taken in 

regulating contribution limits. Among the issues 

the agency addressed were: 

• Designation of Contributions. The statute 

establishes separate limits for contributions 

to the primary and general election campaigns of a candidate. Under the current 

rules, a contribution automatically applies to 

the candidate's next election unless the contributor designates the contribution for 

another election. The Commission considered alternative approaches that would 

clarify this rule and encourage contributors 

to designate their contributions. 

• Redesignation of Contributions. The agency 

discussed whether a contribution may be 

redesignated by the contributor under certain 

circumstances-for example, if a contribution exceeds the contributor's limit for an 

election. 

• Net Debts Outstanding. The Commission explored various options with regard to a campaign's acceptance of contributions after an 

election if the campaign does not have debts 

for that election. 

• Determining the Date of a Contribution. Because the timing of a contribution is significant in several situations-for example, in 

determining whether an undesignated contribution applies toward the primary or 

general election limit-the Commission considered alternative definitions of when a contribution is made or received. 

• Aggregation of Contributions. The agency examined the circumstances under which contributions to a candidate should be aggregated with contributions made to another 

political committee supporting the same candidate. 

• Contributions for Elections Not Held. The 

Commission addressed the question of 

whether contribution limits and reporting requirements apply to an election not held 

because the candidate Is unopposed or was 

nominated or elected in a previous election. 

• Joint Contributions. The agency considered 

several issues related to contributions by 

more than one individual on a single written 

instrument, such as a joint contribution by 

spouses. 

The Commission planned to continue working 

on the revision of the contribution limit rules in 

1986, building on the extensive work completed 

during 1985. 

Rulemaking Petition on Soft Money 

On January 4, 1985, the Commission published a 

Federal Register notice asking for public comment on a rulemaking petition by Common Cause 

(50 Fed. Reg. 477). Common Cause asked that the 

agency draft regulations on the use of "soft 

money" in elections, defining "soft money" as: 

funds that are raised by presidential campaigns and national and congressional 

political party organizations purportedly for 

use by state and local party organizations in 

nonfederal elections, from sources who 

would be barred from making such contributions in connection with a federal election, 

e.g., from corporations and labor unions and 

from individuals who have reached their 

federal contribution limits. 

In its petition, Common Cause requested that 

the FEC "initiate a rulemaking proceeding to 

establish what broader administrative tools, such 

as additional disclosure requirements, are needed to facilitate the Commission's effective enforcement of the current laws.... " 

In response to the written comments received 

on the rulemaking petition, and because of extensive media attention to the role of soft money in 

Federal elections, the Commission published a 

notice of inquiry in the Federal Register (50 Fed. 
11 

Reg. 51535, December 18, 1985). In addition to 

scheduling public hearings for January 29, 1986, 

the notice sought information and comment on 

the factual and legal issues raised in Common 

Cause's petition. Among the topics discussed in 

the notice was whether the Commission has 

jurisdiction to regulate the use of soft money or 

whether legislative amendments would be required. Should regulatory changes be appropriate, the notice asked for suggestions on 

revisions that would remedy the problem. Finally, 

the notice called for information on alleged soft 

money practices to help the agency understand 

the scope of the problem. 

Assistance to Committees 

Beginning with the prescription of regulations, 

which set forth guidelines based on the statute, 

the agency employs a variety of means to help 

committees voluntarily comply with the law. 

Telephone Assistance 

Using the toll-free telephone number (800/ 

424-9530) or local lines, anyone may obtain information about the law directly from Commission 

staff. Public affairs specialists answer questions 

and advise callers on what the law requires, citing 

the statute, regulations and advisory opinions. 

Committee workers may also speak to the staff 

person who reviews the committee's reports (the 

reports analyst). Familiar with the committee's 

finances, as well as the law's reporting provisions, the analyst advises the caller on how to 

report information or correct errors that appeared 

in previous reports (see "Review of Reports," 

below). 

Advisory Opinions 

Any person may formally request an opinion by 

writing a letter asking the Commission's advice 

on how the law applies to a specific, factual situation. Anyone else in the same situation as the requester may also rely upon the answers given in 

an advisory opinion. Of the 36 opinions issued in 

calendar year 1985, several are discussed later in 

this chapter under "Legal Issues." 

1985 Conferences 

The Commission also helps political committees 

by conducting conferences where participants attend structured workshops and informally talk to 

Commissioners and agency staff about problems 

and conerns. During the fall of 1985, the Commission cosponsored conferences with the Massachusetts and Colorado Secretaries of State. The 

workshops concentrated exclusively on Federal 

and State campaign finance laws. 

Encouraged by the positive response of attendees (averaging 120 per conference), the Commission expanded the conference program to include workshops designed for particular audiences. In October 1985, the FEC held a one-day 

conference just for trade associations and other 

incorporated membership groups. Conducted at 

George Mason University, the conference was 

heavily attended by individuals based in the 

Washington, D.C. metropolitan area. 

Publications• 

The FEC's publications offer still another avenue 

to political committees and others who seek 

guidance on the law. For the second consecutive 

year, the agency received an award from the National Association of Government Communicators for the quality and clarity of its published 

materials. During 1985, the Commission updated 

brochures to reflect regulatory changes and 

published FEC: The First 10 Years, a special 

publication to mark the Commission's tenth year 

of operation. The report contained graphs displaying campaign finance data from 1978 through 

1984 and included a brief history of the campaign 

finance law. 

To ensure that the publications program was 

meeting the needs of committees and candidates, 

4 For a description of publications produced by the FEC's 

Clearinghouse on Election Administration, see Appendix 8. 
12 

the agency asked readers to evaluate its publications and reporting notices on filing deadlines in a 

1985 survey sent to the 11,500 subscribers to the 

FEC's monthly newsletter, the Record. (The 

Record is sent to all political committees and 

others who request subscriptions.) Survey results, 

based on responses from 1,150 subscribers, were 

positive overall. Readers found the publications 

easy to read and useful; they liked the graphs and 

charts; they said that the notices provided essential information well in advance of report dates; 

and they offered ideas for new articles and 

brochures. 

Review of Reports 

The Commission reviews all campaign finance 

reports to ensure accurate and complete 

disclosure of financial activity and to encourage 

compliance with the law's reporting provisions. 

If the agency discovers a problem in the course 

of reviewing a report, it sends a letter to the committee requesting additional information. The 

committee then has the opportunity to amend its 

report voluntarily and help preserve the integrity 

of the public record. If a committee receives such 

a letter (called an RFAI), it should call the reports 

analyst who signed the letter. Cooperation between the committee and the Commission often 

results in the settlement of a potential compliance matter without further action by the agency. And, in cases where the Commission must 

pursue legal action, a committee's attempts to 

correct a mistake are considered mitigating circumstances by the Commission when it 

deliberates on the matter. 

In an effort to catch errors earlier, and thus 

notify committees more quickly, the Commission 

completed review of reports for the 1983-84 election cycle five months faster than it had for the 

1981-82 cycle. The table below summarizes the 

review process over the past four calendar years. 

Reports Review Activity 

1982 1983 1984 1985 

Number of committees 

reviewed 2,807 5,510 3,908 8,454 

Number of re~rta 

reviewed 20,598 39,837 30,154 46,905 

Number of reports 

receiving RFAia 4,633 5,319 6,292 7,414 

Presidential 5 78 246 117 

Senate 444 392 496 276 

House 2,106 1,403 2,302 1,374 

Party 399 413 714 858 

Nonparty (PACs) 1,658 2,989 2,494 4,729 

Other 21 44 40 60 

Enforcement 

Possible violations of the Federal campaign 

finance law are brought to the Commission's attention either internally-through its own 

monitoring procedures (and referrals from other 

government agencies)-or externally-through 

formal complaints originating outside the agency. 

Potential violations receive case numbers and 

become MURs, Matters Under Review. 

The law requires that all phases of the MUR 

process remain confidential until a case is closed 

and put on the public record. The respondents 

(those alleged to have violated the law) are afforded a reasonable opportunity to demonstrate that 

no action should be taken against them. If the 

Commission, after investigation, believes there is 

sufficient evidence to show that a violation occurred, the agency must try to resolve the matter informally through a conciliation agreement with 

the respondent. (Conciliation may also be initiated by the respondent.) If unable to reach 

agreement, the agency may try to enforce the matter through litigation. 
13 

Processing MURs1 

The Commission approved revised enforcement 

procedures (effective June 3, 1985) to expedite the 

MUR process. The new procedures are intended 

to speed up the flow of work, focus issues arising 

from compliance cases more clearly and obtain 

more timely replies from respondents. 

The new procedures tighten deadlines tor completing internal FEC reports on MURs. They also 

reduce extensions of time granted to respondents 

from 30 days to 20 days, unless the respondent 

submits a formal, written request, which is then 

voted on by the Commissioners. To accelerate the 

Caseload of MURs 

1980 1981 1982 1983 1984 1985 

cases pending at 

beginning of 

year 152 214 113 93 78 172 

Cases opened 

during year 255 66 113 103 283 257 

External 133 24 78 42 163 51 

lntemal 122 42 35 61 120 206 

Cases closed 

during year 193 167 133 118 189 292 

Extemal 91 64 67 58 103 97 

lntemal 102 103 66 60 86 195 

Cases pending at 

end of year 214 113 93 78 172 137 

conciliation process, the procedures allow the 

Commission to file a civil suit against the 

respondents after 30 days of conciliation negotiations, if they do not appear fruitful, instead of conducting negotiations the full statutory period of 

90 days. 

Commission efforts to handle MURs more efficiently were successful. While the average time 

taken to complete a MURin fiscal year 1984 was 

251 hours, in fiscal year 1985, the average dropped to 168 hours per MUR. The table below compares the MUR caseload over the past six calendar years. 

5litigatlon related to the processing of MURs is summarized under "Legal Issues," page 14. 
14 

Revised Regulations on MUR Procedures 

The Commission asked for public comment on 

four major issues and other aspects of the enforcement rules (11 CFR Part 111) in a May 22, 

1985, Federal Register notice (50 Fed. Reg. 21077). 

The issues had been raised by public groups, by 

individuals involved in MURs and by Commissioners themselves. 

One issue concerned whether the agency 

should, in the case of externally generated complaints, provide respondents with a separate 

statement explaining the factual and legal basis 

for the agency's "reason to believe" finding. Such 

a statement is automatically sent to respondents 

of internally generated MURs, but only a copy of 

the complaint is mailed if the MUR is initiated by a 

member of the public. Under current procedures, 

the complaint is considered adequate notice 

although it may not fully or clearly state the 

issues. As an alternative, the advance notice proposed that the agency send the respondent a 

statement analyzing those issues not adequately 

explained in the complaint. 

Another question raised in the Federal Register 

notice was whether the Commission should incorporate in its rules a revised internal procedure 

concerning extensions of time for respondents. 

(The revised internal procedures are described 

above.) 

The notice also addressed the issue of the legal 

liability of committee officials. Under the Federal 

Election Campaign Act, the Commission may 

take action against candidates and committee officials for possible violations of the law. In August 

1983, the Commission decided to name candidates and committee treasurers (in their official 

capacities) as respondents in compliance actions 

brought against their committees (Agenda Document 83-119). In May 1984, the agency decided 

that, even if alleged violations occurred during the 

tenure of a past treasurer, the Commission would 

nevertheless name the current treasurer (in his or 

her official capacity) as a respondent (Agenda 

Document 84-79). The question posed in the 

notice was whether the Commission should inelude these procedures in its regulations as a way 

of providing notice to potential respondents. 

Finally, the notice asked for comments on 

whether to include in the revised rules certain internal procedures and review standards concerning requests for stays of FEC determinations concerning the repayment of public funds. 

The agency reviewed comments submitted in 

response to the advance notice and plans to 

publish a notice of proposed rulemaking on the 

compliance regulations in 1986. 

Late Filers 

Continuing its policy of rigid enforcement with 

regard to late filers, the Commission handled 

numerous cases against political committees 

that were late in filing reports. Civil penalties attached to these MURs reflected the Commission's view that late filing thwarts the purpose of 

disclosure. 

Legal Issues 

During 1985, a number of legal issues were 

clarified through litigation and advisory opinions.8 

This section first summarizes litigation related to 

FEC enforcement procdures, including one case 

arising from a Freedom of Information Act request. Another suit concerns voter publications 

paid for by a nonprofit corporation. 

Corporate involvement in Federal elections was 

the predominant theme of advisory opinions (AOs) 

issued in 1985. These and other issues addressed 

in AOs are discussed later in the section. 

Dismissal Date of Complaint 

Under the campaign finance law, a suit challenging the FEC's dismissal of a complaint must be 

filed with the U.S. District Court for the District of 

Columbia within 60 days after the MUR is dismissed (2 U.S.C. Section 437g(a)(8)(A)). Two 

•court cases concerning public funding, including a 

Supreme Court case, are discussed in Chapter 1. 
15 

D.C.district courts reached different conclusions 

as to when the 60-day period begins to run. In 

three cases (Common Cause v. FEC, Golar v. FEC 

and Citizens for Percy v. FEC), one court concluded that the 60 days begin, not on the day the Commission takes final action, but on the day the 

complainant actually receives the notice of 

dismissal from the FEC. Based on this ruling, the 

court dismissed the Percy suit, but agreed to hear 

the other two suits. 

In Antosh v. FEC, another D.C. court reached a 

different result. In a suit to review a conciliation 

agreement entered into by the Commission, the 

district court concluded that the 60-day period for 

filing suit began on "the date the Commission approved the conciliation agreements and they 

became effective." Finding that the matter had 

been filed within 60 days of that date, the court 

agreed to hear the case. 

Audits 

Under the Federal campaign finance law, the 

Commission is required to audit public funding 

recipients. 7 The agency is also authorized to conduct two other types of audits. Under Section 

438(b) of the Federal Election Campaign Act, the 

Commission may audit any political committee 

whose reports have not met threshold compliance 

standards. Section 437g(a)(2), on the other hand, 

authorizes the agency to conduct audits as part of 

its investigations into alleged violations of the 

law by respondents in MURs. One suit filed in 

1985 challenged the Commission's audit authority. A second suit concerned a committee's effort 

to obtain the Commission's internal threshold requirements for auditing committees (under Section 438(b)). 

Section 437g(a)(2) Audit. In papers filed with the 

U.S. District Court for the Northern District of 

Texas, the Friends of Phil Gramm (the Committee) 

alleged that, based on a complaint filed against 

the Committee and on information gathered 

through internal procedures, in March 1985 the 

Commission found "reason to believe" that the 

Committee had violated several provisions of the 

Federal Election Campaign Act. The agency then 

authorized an audit of the Committee to investigate whether the alleged violations had occurred. (The "reason to believe" finding is a 

statutory prerequisite to an investigation into 

possible violations.) 

On June 19, 1985, the Gramm Committee asked 

the district court to stop the FEC audit. The Committee claimed that, under Section 438(b) of the 

Act, the Commission was required to begin the 

audit within a specified period of time. Because 

these deadlines had passed, the Committee 

argued, the FEC had no statutory authority to conduct the audit. The Gramm Committee also contended that the Commission was required to attempt conciliation before conducting the audit. 

Waiting for the court's decision, the Committee 

refused to provide documents the Commission 

had subpoenaed in connection with the audit. 

In its memorandum opinion of October 18, 1985, 

the Texas court granted the FEC's motion to 

dismiss the suit filed by the Gramm Committee. 

The court noted that the time limit of Section 

438(b) "is inapplicable to an audit scheduled 

under §437" and found that the Gramm audit was 

"well within its [§437's] parameters." Rejecti'ng 

the Committee's claim concerning conciliation, 

the court stated that "the FEC is entitled to conduct its audit and gather the necessary information ... before it attempts to conciliate with the 

violator." Later that month, on October 31, the 

court decided that the Gramm Committee was required to comply with the FEC's subpoena. 

Section 438(b) Audit. In 1984, the Commission 

authorized an audit of the Fund for a Conservative 

Majority (FCM) because its reports did not meet 

the Commission's threshold requirements for 

substantial compliance with the law. FCM then 

asked the Commission to disclose the threshold 

requirements as well as staff recommendations 7SE'e Chapter 1, page 5. 
16 

detailing FCM's failure to meet those requirements. The request was made under the 

Freedom of Information Act (FOIA). When the 

agency refused to disclose the materials, FCM 

filed suit in the U.S. District Court for the District 

of Columbia, challenging the FEC's refusal. 

On February 26, 1985, the court upheld the 

FEC's action and ruled that the requested information was exempt from disclosure under the 

FOIA. One provision of the FOIA (Section 

552(b)(2)) exempts matters related to internal practices. The court found that the information was 

"predominantly internal" and did not constitute 

"secret law." "The plaintiff's argument that it is 

'in the dark' as to how to pass that review [i.e., an 

FEC review of its reports] is especially weak in 

light of the many letters it has received from the 

Commission, advising and pointing out apparent 

reporting inconsistencies and irregularities." 

Further, the district court agreed with the Commission that disclosure of the threshold requirements "would enable unscrupulous political 

committees to tailor their reports to avoid being 

audited, and ignore statutory reporting requirements that are not central to the internal review 

procedures." 

Corporate Voter Publications 

Under 2 U.S.C. Section 441b, an incorporated 

organization may pay for partisan communications directed to certain individuals associated 

with the organization (i.e., its restricted class). 

Partisan communications distributed to the 

general public, however, result in prohibited corporate expenditures. In response to a complaint 

filed with the Commission, the agency found 

probable cause to believe that the Massachusetts 

Citizens for Life (MCFL), a nonprofit corporation, 

had made prohibited corporate expenditures by 

printing and distributing partisan communications to the general public. In September 1978, 

MCFL published material that exhorted readers to 

"vote pro-life" and identified by name all candidates it considered to be pro-life. MCFL had not 

only mailed free copies to thousands of individuals outside its restricted class but also left 

copies in public areas for general distribution. 

After unsuccessfully attempting to conciliate the 

matter, the FEC filed suit against MCFL in the 

U.S. District Court for the District of 

Massachusetts. 

On June 29, 1984, the district court held that 

MCFL's spending for the 1978 publication (and a 

subsequent supplement) did not constitute prohibited corporate expenditures, as defined under 

Section 441b(b)(2). Alternatively, the court stated 

that, if MCFL's publication costs were not exempt 

from Section 441b's prohibition on corporate expenditures, then the provision would be unconstitutional, as applied. 

The FEC appealed this decision and, on July 31, 

1985, the U.S. Court of Appeals for the First Circuit overturned the district court's ruling that the 

publication costs were not prohibited corporate 

expenditures. The court, however, did affirm the 

lower court's judgment in favor of MCFL, but on 

the ground that Section 441 b, as applied to 

MCFL's expenditures, was unconstitutional. The 

appeals court said that there was no substantial 

government interest (i.e., to prevent corruption or 

the appearance of corruption) in prohibiting 

MCFL's expenditures for the publications. 

"Because MCFL did not contribute directly to a 

political campaign, MCFL's expenditures did not 

incur any political debts from legislators." The appeals court concluded that "the application of 

section 441b to indirect, uncoordinated expenditures by a non-profit ideological corporation expressing its views of political candidates violates 

the organization's First Amendment rights." 

The Commission appealed this decision to the 

U.S. Supreme Court, which, on January 13, 1986, 

agreed to hear the case. 

Contribution Limits 

A number of advisory opinions (AOs) offered 

guidance on the application of the law's contribution limits. 
17 

Corporate Merger. Under the campaign finance 

law, political action committees (PACs) established by a parent corporation and its subsidiaries 

are affiliated committees. Affiliation affects how 

much the committees may contribute since contributions made by affiliated committees count 

against one, shared limit. How do the contribution 

limits apply when two previously unaffiliated 

PACs, each operating under a separate limit, 

become affiliated as a result of the merger of their 

corporate sponsors? This was the situation 

presented in AO 1985-27. 

In this opinion, the Commission said that the 

respective PACs of R.J. Reynolds Industries and 

Nabisco Brands became affiliated, and thus subject to a single limit, when Reynolds gained a controlling interest in Nabisco. The PACs would have 

to aggregate the contributions they had each 

made before becoming affiliated with contributions they made afterwards. 

Commissioner Lee Ann Elliott filed a dissenting 

opinion in which she concluded that the PACs 

became affiliated on a later date, when the merger 

agreement was ratified by stockholders. 

Contributions Received After Election. Representative Joe Kolter asked the Commission how 

he should treat a contribution intended for his 

1984 general election but received and deposited 

the day after the election. Would the contribution 

count against the contributor's limit for the 

general election, or would it have to be applied to 

the limit for Mr. Kolter's next election, the 1986 

primary? In AO 1985-5, the Commission decided 

that the contribution, made by a check dated October 29, would have to be charged to the contributor's limit for the 1986 primary because Mr. 

Kolter's committee did not receive the contribution until after the general election and because 

the committee had no outstanding debts at that 

time. 

The Commission based this conclusion on 

several past advisory opinions which used the 

"date of receipt" of a contribution and the 

absence of committee debts as the basis for 

determining which election the contribution 

would count against. 

In a concurring opinion, Commissioner Thomas 

E. Harris noted his "concerns about an approach 

that focuses on the date of receiving rather than 

the date of making the contribution ...." He went 

on to state: "It would better effectuate the contributor's intent and relieve recipient committees 

of a significant administrative burden if the Commission were to rely solely on the date a contribu· 

tion was made for determining the election to 

which it is attributable. I would construe the date 

of 'making' to be the date the contribution left the 

control of the contributor." Mr. Harris concluded 

that "rather than suddenly reversing the course 

taken since 1977 in the context of this advisory 

opinion, the most prudent course for resolving 

these issues is through a rulemaking 

proceeding."8 

Contributions from Spouses. Some contributors 

who had purchased tickets to a fund raiser held by 

the Steve Bartlett Congressional Campaign Committee later made additional contributions to the 

Committee which caused them to exceed the 

$1,000 per-election limit. The Committee asked 

the Commission if it could reattribute the excessive amounts to donors' spouses. To carry out 

this plan, the Committee proposed sending a letter and contribution reattribution form to those 

married individuals who had made excessive contributions. The letter would explain the contribution limits and the donor's option to reattribute 

the excessive portion of the contributions to his 

or her spouse. The contribution reattribution form, 

to be returned to the Committee, would include 

each spouse's signature and information on the 

reattributed contribution. 

In its response, AO 1985-25, the Commission 

said that the letter and form would satisfy FEC 

regulations governing contributions from 

'In 1985, the Commission began to revise its regulations 

·dealing with contribution limits. See page 9. 
18 

spouses and contributions from more than one 

person using the same check. However, to avoid 

circumvention of the contribution limits, the opinion said that the Committee, among other things, 

would have to give contributors the option of asking for a refund of the excess amount. Furthermore, because FEC regulations require contributions that appear to be illegal to be refunded 

"within a reasonable time" (11 CFR 103.3(b)), the 

Commission said that "[a]ny refund made within 

10 days of the receipt of the donor's request will 

be presumed to have been made promptly." If a 

contributor did not respond to the letter, the Committee would have to make the refund within 30 

days after receiving the excess contribution. 

Party Expenditures 

National party committees may contribute directly to candidate committees and, additionally, 

make limited expenditures on behalf of the party's 

general election nominees. In AO 1985-14, the 

Commission had to decide whether political 

advertisements (via radio, television and direct 

mail) planned by the Democratic Congressional 

Campaign Committee (DCCC) would be allocable 

to specific candidates and thus be considered 

contributions or party expenditures, subject to 

limits, or whether, instead, the ads would be considered operating expenditures, not subject to 

any limits. 

DCCC's proposed ads, scheduled for release in 

June and September 1985, criticized the records 

of Republican Congressmen and were intended to 

influence the 1986 election process. (The Commission emphasized that the opinion was limited 

to the timetable specified by the DCCC). The 

DCCC planned to disseminate the ad campaign in 

20 to 100 Congressional districts represented by 

Republican Congressmen, some of whom were 

not announced candidates for 1986. Additionally, 

in some districts, there would be no announced or 

qualified Democratic candidates. 

In analyzing the scripts and materials for the 

proposed ad program, the Commission made the 

following determinations: 

• Ads that referred to "Republicans in Congress" as a group would result in operating 

expenditures, regardless of whether they included an electioneering message urging the 

audience to "Vote Democratic." 

• Ads that referred to "your Republican Congressman" but that did not include the "Vote 

Democratic" statement would also be considered operating expenditures. 

• Direct mail ads that referred to a specific 

Republican Congressman by name (and that 

would be disseminated in that Congressman's Congressional district), with or 

without the "Vote Democratic" message, 

woul~ result in either contributions or party 

expenditures on behalf of the eventual 

Democratic nominee and would therefore be 

subject to the relevant limits. 

With respect to radio and television ads that 

used both the "your Republican Congressman" 

wording and the "Vote Democratic" statement, 

the Commissioners, by a tie vote, could not agree 

on a determination. 

Incorporated Campaign Firm 

B.A.D. Campaigns, an incorporated campaign 

consulting firm, planned to mail slate cards to the 

general public shortly before the 1986 California 

primary elections. The slates would urge the voter 

to support the Federal and State candidates listed 

on the card. Early in 1986, the firm would decide 

which Democratic candidates to endorse on the 

slates. The firm would then offer the chosen candidates the opportunity to purchase additional 

advertising space. Endorsed candidates, however, would be listed even if they did not purchase 

special publicity. 

In AO 1984-62 (issued in 1985), the Commission 

said that, by listing nonpaying Federal candidates 

on a slate that carried a general electioneering 

message, B.A.D. Campaigns would be providing 

something of value to those candidates in the 

form of free campaign advertising. This would 
19 

result in prohibited expenditures (and in-kind contributions) of corporate funds in a Federal election. 

Purchase/Sale of Campaign 

Computer Systems 

In two opinions involving the sale or purchase of 

computers, the Commission offered guidance 

concerning transactions between candidate committees and corporations. 

Sale of Computer System. In AO 1985·1, the Commission said that the Ratchford for Congress 

Committee could sell its computer system, at the 

usual and normal charge, to a corporation or other 

potential buyer, assuming the Committee terminated its operations shortly after the sale. 

The Commission noted that the opinion might 

not apply if the Committee sold the computer 

system but remained in existence as a commit· 

tee. In a previous opinion, AO 1983-2, the Commission concluded that business or commercial-type 

ventures of ongoing political committees are 

simply another form of fundraising, the proceeds 

of which are subject to the law's prohibitions and 

limits. 

Joint Purchase of Computer System with Corpora· 

tion. The Commission determined in AO 1985-19 

that Congressman Vallely's campaign would be 

prohibited from jointly purchasing a computer 

system with a corporation. Under the proposed arrangement, the Committee would have paid only 

half the cost of the system but would have had 

unrestricted access. This benefit would have 

resulted in a prohibited contribution from the corporation to the Committee. 

Use of Corporate Facilities 

General Mills, Inc. asked the Commission 

whether it could distribute to its employees some 

election-related materials written by an employee. 

(General Mills would not review or approve the 

materials.) In AO 1985-26, the Commission concluded that General Mills could provide the service as long as it was reimbursed by the employee. 

Under Section 114.9(c) of FEC regulations, a person who uses corporate facilities to produce 

materials in connection with a Federal election is 

required to reimburse the corporation the normal 

and usual charge within a commercially 

reasonable time. Since the use of corporate 

facilities for labeling and distributing the 

literature could "be viewed as part of the process 

of producing the materials," the Commission concluded that Section 114.9(c) would apply. 

Unincorporated Organization's 

Establishment of PAC 

As an exception to the law's broad prohibition on 

corporate involvement in connection with Federal 

elections, a corporation may underwrite the costs 

of establishing and administering a political committee, referred to as a separate segregated fund 

(SSF) and popularly called a corporate PAC 

(political action committee). In addition to using 

treasury funds to set up and run the SSF, the 

sponsoring corporation may pay the SSF's expenses for soliciting contributions. 

The National Football League (NFL) asked the 

Commission if it could take advantage of this exception by forming an SSF, despite its status as 

an unincorporated membership group. In AO 

1985-24, the Commission said that the NFL was 

not eligible to establish an SSF because the exemption applies only to incorporated membership 

groups. The opinion noted that the different treatment that the law accords unincorporated and in· 

corporated organizations was upheld by the 

Supreme Court in California Medical Association 

v. FEC. 

Eligibility for Corporate Solicitation 

An SSF may solicit contributions only from certain individuals who are related to the SSF's sponsoring organization, i.e., the restricted class. 

Several 1985 opinions helped identify which in· 

dividuals would be included in the restricted 

class. 
20 

Solicitation of Affiliate's Personnel and Stockholders. Under the campaign finance law, a corporation may solicit its own executive and administrative personnel and stockholders and 

those of an affiliate. Anheuser-Busch Companies, 

Inc. asked the Commission if its separate 

segregated fund could solicit contributions from 

the executive and administrative personnel of 

wholesale distributors who had equity 

agreements with Anheuser"Busch, Inc., a subsidiary of the parent corporation. In AO 1985-7, the 

Commission concluded that the degree of influence Anheuser-Busch held over the wholesale 

distributors was insufficient to establish affiliation. Therefore, the wholesalers' personnel could 

not be solicited by the SSF. In reaching this determination, the Commission considered two factors 

highly relevant: 1) the lack of the corporation's 

power to choose the wholesalers' managers and 

2) the right of the wholesalers to market the products of other brewers. 

In AO 1985-31, on the other hand, the Commission found that affiliation did exist between 

CIGNA Corporation, an insurance firm, and COMPAR insurance agencies. The material difference 

between the situation presented in this opinion 

and the situation in the Anheuser-Busch opinion 

was that the COMPAR agencies could sell only 

CIGNA insurance (except in special cases, and 

then only with the prior approval of CIGNA). In addition to this exclusive product factor, the Commission found other evidence of CIGNA's direction and control over COMPAR agencies. For example, while a COMPAR agency could underwrite, price and issue insurance policies, CIGNA 

reviewed the agency's exercise of this authority 

and could revoke it. Furthermore, COMPAR agencies were entitled to extensive management and 

financial assistance from CIGNA. Because COMPAR agencies constituted affiliates of CIGNA, 

their stockholders and executive and administrative personnel could be solicited for contributions to CIGNA's SSF. 

Commissioner Thomas E. Harris dissented 

from AO 1985-31, as he had from past opinions 

presenting similar situations, "largely because I 

do not feel the contractual arrangement in question rises to the level of control achieved by 

ownership of controlling shares and the attendant 

authority to select management." In addition, Mr. 

Harris pointed out that, as a result of the opinion, 

any SSFs set up by the COM PAR insurance agencies would have to share one contribution limit 

with CIGNA's SSF, since affiliated committees 

are considered one political committee for purposes of the law's limits. Mr. Harris believed the 

Commission should have explored whether the 

agencies "would characterize themselves as 

'controlled' by CIGNA Corporation ...." 

Board of Directors. AO 1985-35 considered 

whether the board of directors of an employeeowned corporation would be considered corporate executives and thus eligible to be solicited 

for contributions to the corporation's SSF. Only 

one board member of Wierton Steel was an 

employee/stockholder. The remainder of the 

board consisted of outside individuals, most of 

whom received an annual director's fee (plus 

reimbursement for expenses incurred in attending 

board meetings). 

The Federal Election Campaign Act defines executive and administrative personnel to mean "individuals ... paid on a salary, rather than hourly, 

basis and who have policymaking, managerial, 

professional, or supervisory responsibilities." 

Commission regulations, however, specify that 

this definition excludes individuals, such as consultants and contractors, whose income tax 

payments are not withheld from their pay. 

Nevertheless, AO 1985-35 stated that "the Commission does not view its regulations as requiring 

that compensation paid to directors of a corporation be subject to the income withholding tax in 

order for the directors to qualify as executive or 

administrative personnel." Accordingly, the Commission concluded that Wierton directors who 

were paid fixed annual fees would be considered 

executive/administrative personnel and therefore 

eligible for solicitation. 
21 

Personal Members of Trade Association. In addition to soliciting its executive/administrative personnel for contributions to its SSF, an incorporated trade association may solicit its noncorporate members (and solicitable personnel and 

stockholders of corporate members that have 

given prior approval, as discussed below). In its 

1982 decision in FEC v. National Right to Work 

Committee, the Supreme Court defined a 

solicitable member as a person who has some 

relatively enduring and significant attachment to 

the organization. Commission advisory opinions 

have determined that, in order to meet this 

"organizational attachment" standard, a member 

must have 1) some right to participate in the 

governance of the organization and 2) an obligation to sustain the organization through regular, 

fixed dues payments. 

In AO 1985-11, the Commission determined that 

"personal members," a new membership class 

proposed by the Private Truck Council of America, 

Inc., would not meet the definition of "member" 

and thus could not be solicited for contributions 

to the Council's SSF. Personal members would 

not qualify as members because, although they 

would pay dues, they would lack sufficient rights 

to govern the Council. Specifically, personal 

members would have no voting rights and, 

although they would be eligible for election as 

Council directors, their representation on the 

governing body was not assured. 

Trade Association's Solicitation Approval Form 

In order to request contributions to its SSF from 

solicitable personnel and stockholders of its corporate members, a trade association must first 

obtain written permission from the corporation. 

Once a member corporation grants the approval, 

it may not authorize solicitations by any other 

trade association for that year. In AO 1984-61 

(issued in 1985), the Commission said that the 

Society of American Florists could use a single 

form to obtain corporate approvals for multiple 

years, rather than a separate document for each 

year's approval. A separate authorizing signature 

for each year, however, was required on the form. 

Use of FEC Information on Contributors 

To protect the privacy of individual contributors 

listed on reports filed at the FEC, the campaign 

finance law specifically prohibits the use of individual contributor information for soliciting contributions or for commercial purposes. In AO 

1985-16, the Commission said that Robert Weiss 

could not use contributor information obtained 

from FEC reports to verify the names of contributors contained on a list that he planned to 

market. (Mr. Weiss had prepared the list he 

wished to verify without the use of FEC information.) Such use would have increased the commercial value of his list, thereby violating the ban on 

the commercial use of FEC contributor information. 
22 

Clearinghouse on Election 

Administration 

The FEC's National Clearinghouse serves as a 

central exchange point for research and informa· 

tion regarding the administration of Federal elections. In providing information services to State 

and local election agencies, the office publishes 

research studies, conducts workshops and 

responds to telephone and letter inquiries. During 

1985, the Clearinghouse focused on three major 

projects: a study on Voting System Standards; the 

implementation of the Voting Accessibility for the 

Elderly and Handicapped Act; and a guide for 

local election officials on computerizing election 

administration. These and other Clearinghouse 

activities are described below. 

Voting System Standards 

During 1985, the Clearinghouse worked on a 

three-phase Voting System Standards project, 

responding to the need for the development of 

minimum standards for use by the States in 

assessing a voting system's reliability, security 

and performance. Although four types of voting 

machines are generally used, the Clearinghouse 

decided to focus first on punchcard and 

marksense devices, since lever machines are no 

longer being manufactured and fully electronic 

systems are not yet widely marketed. 

The first volume, scheduled for release in 1986, 

addresses standards for hardware components, 

i.e., polling place punching or marking devices, 

ballot card readers, processors and printers. The 

hardware standards cover such topics as ballot 

processing speed and accuracy, equipment 

maintenance and equipment durability. 

The second phase of the study, now under way, 

is the development of standards for software, 

such as audit control features and memory requirements. The third phase, also in progress, 

sets out guidelines for managing the punchcard 

and marksense voting systems. 

Voting Accessibility Act 

Congress granted the Commission new responsibilities under the Voting Accessibility for the 

Elderly and Handicapped Act, signed by the President on September 28, 1984. The Act stipulates 

that registration and polling places for Federal 

elections must be accessible to handicapped and 

elderly individuals. For the next five election 

cycles, the States will report to the Commission 

on the accessibility of polling places, giving 

reasons for the inaccessibility of a site. The Commission will consolidate this information in 

reports to Congress beginning in 1987, following 

the 1986 elections. 

Although the Act does not assign the FEC the 

role of developing guidelines or of evaluating 

States' compliance with the law, the Clearinghouse consulted with election officials and 

groups representing handicapped and elderly 

voters in order to gather information of use to 

States in implementing the Act. The research also 

helped the Clearinghouse design an FEC form to 

be used by States in reporting on voting accessibility. 

Computerizing Election Administration 

The vast majority of election offices today either 

are using computers in some way or are giving it 

serious thought. The applications of computers in 

election administration are now so varied, and 

their record of success so mixed, that the Clearinghouse has embarked on a three-phase project 

intended to pool the current widsom and experience on the subject. 

The first phase, Volume I, Current Applications, 

was published in 1985. It provides a brief introduction to using computers effectively and is also intended to facilitate communication among election officials through a survey of approximately 50 

jurisdictions that have automated their election 

functions. 

The second phase of the project, nearing completion, presents a design of a totally computer-
23 

ized election system. Election officials may adopt 

modules of it as needs and resources dictate; 

they may add capabilities later without restructuring what is already in place. 

The third phase, currently under way, suggests 

appropriate implementation strategies, for example, use of shared versus in-house equipment. 

Clearinghouse Panels 

On August 5 and 6, two Clearinghouse panels met 

in Washington-the Advisory Panel, which advises the Clearinghouse on projects and studies, 

and the Advisory Committee on Voting System 

Standards, a group formed to help the Clearinghouse on this project. Composed of State and 

local election officials, the panels shared some of 

the same members. 

In joint sessions, the panels discussed, among 

other topics, the Voting Accessibility Act, the use 

of postal change-of-address forms for voter registration, and the State computer access program.9 

Clearinghouse Publications 

The Clearinghouse published several new studies 

in 1985 and resumed publication of its newsletter, 

the FEC Journal of Election Administration, which 

had been suspended in 1981 due to limited funds. 

Appendix 8 lists Clearinghouse publications currently available as well as reports in progress. 

8See page 7. 
25 

Chapter 3 

Campaign Finance 

Statistics 

This chapter presents a graphic summary of campaign finance activity for the 1983-84 Federal election cycle. Information depicted in the charts 

represents final figures on the campaign finance 

activity of: House and Senate candidates, independent spenders, party committees and 

political action committees (PACs). The graphs 

cover activity between January 1, 1983, and 

December 31, 1984; the information has been adjusted for transfers among affiliated committees. 

More detailed information may be obtained from 

the five-volume study, FEC Reports on Financial 

Activity, 1983-84, Final Report. 

In addition, the graphs present preliminary information on the financial activity of Presidential 

primary campaigns. 

House and Senate Candidates 

Chart I 

Spending by House and Senate Candldates,1 1983·1984 

Millions of Dollars 

80 J!l Incumbents 

70 

60 

50 

40 

30 

20 

10 

0 

Republican Democratic Republican 

House Senate ~ Challengers 

II Open Seat 

Democratic 

'Includes spending by House and Senate candidates for 1984 or a future election or for retiring debts of former elections. 
Chart II 

Sources of Funding,' 1983·84 

Individual Contributions 

PAC Contrlbutlons1 

Party Contributions 

Party Expendltures3 

- Candidate Contributions 

- Candidate Loans 

~ Other Receipts• 

26 

House Candidates 

Open Seat Incumbents Challengers 

5% 

Senate Candidates' 

Open Seat 

% 

~~=7% "»'~-- .4% 

'------9% 

Incumbents Challengers 

'Chart covers funding for all elections (primary, runoff and general) of those candidates running in the November 1984 general 

election. 2A "PAC" (or political action committee) is a political committee that is neither a candidate committee nor a party committee. 3"Party Expenditures" are limited expenditures made by party committees on behalf of Federal candidates in the general election. 2 U.S.C. §441a(d). 4"0ther Receipts" include loans, rebates, refunds, contributions from unregistered entities and other campaign committees, 

interest and dividends. 

•since there are relatively few Senate candidates, total figures on Senate races may be significantly affected by the activity of a 

single campaign. For example, a West Virginia candidate's loans to his campaign and the tljorth Carolina candidates' large proportion of contributions from individuals have had significant impact on the overall activity depicted in these charts. 
Independent Expenditures 

Chart Ill 

Independent Expendltures1 In Congressional Races, 1983·84 

Millions of Dollars 

2.2 House Races 

2.0 

1.8 

1.6 

1.4 

1.2 

1.0 

0.8 'W'~~--~~,~~----"0>w.=HN0 

Senate Races For 

Against 

0.4 

0.2 

0 

Democrats Republicans Democrats Republicans 

27 

Chart IV 

Independent Expendltures1 in All Races, 1983·84 

For Presidential Candidates 

For Senate Candidates 

For House Candidates 

Against Presidential Candidates 

Against Senate Candidates 

Against House Candidates 

0 2 4 6 8 10 12 14 16 18

Millions of Dollars 

'Under the Federal election law, an independent expenditure is an expenditure for a communication expressly advocating the 

election or defeat of a clearly identified candidate. The expenditure must be made without cooperation or consultation with the candidate or his/her campaign. 
Individual 

Contributions 

Federal 

Matching Funds 

mB Loans 

~Received 

Other Receipts 

28 

Presidential Funding 

Chart V 

Receipts1 of Presidential Primary Candidates Through 6/30/85 

Millions of Dollars 

'Includes total receipts minus transfers between each candidate's authorized committees. 

21"he Cranston for President Committee has not identified all the sources of funds received during 1984. Consequently, some of 

the receipt categories may eventually be larger (e.g., individual contributions). 
29 

Chart VI 

1984 Presidential General Election 

Mondale/Ferraro 

Reagan/Bush 

Millions of Dollars 

0 10 20 30 40 

Federal Funds 

Party 

Expenditures1 

Contributions to 

Compliance Fund2 

1See 2 U.S.C. §441a(d). 2Fund supports legal and accounting services related to compliance with the election law. 

Party Committees 

Chart VII 

Receipts1 of Major Parties, 1983·84 

Democratic Receipts by Source 

.-------------Individual Contributions (59.2%) 

.,-----------PACContributions (6.6%) 

::::::~~--------Other Recelpts2 (34.2%) 

Total 

$ 58.3 million 

6.5mlllion 

33.7 million 

$ 98.5 million 

Republican Receipts by Source 

,-------------IndividualContributions (87.9%) 

.........+..~:----------PAC Contributions (0.6%) 

·~---------Other Receipts2 (11.5%) 

Total 

$262.0 million 

1.7 million 

34.2 million 

$297.9 million 

1lncludes total receipts minus transfers among each party's committees. 20ther receipts include contributions from other political committees and unregistered organizations (e.g., local party organiza. 

tions); loans or loan repayments received by party committees; offsets to expenditures; dividends, interest and other miscellaneous 

income. 
Millions of Dollars 

250 ________..__...................._ 

National 225 Committee 

200 ---·- ~ Senatorial ~Committee 

175 ~·----- Congressional 

Committee 

150 ...-......... ...--.···-~--··················..................................................................................................... $106.1 million 1 

125 -~---------·----..··----·-------~--[ 

50 -----··-···-· 

25 _..........-~----1:§ 

$46.6 million 

$ 8.9 million $ 58.3 million 

Democratic Party Republican Party 

30 

Chart VIII 

Recelptst of National Party Committees, 1983·84 

'Includes total receipts minus transfers between each party's respective committees. 

Chart IX 

Major Party Support of Federal Candidates, 1983·84 

Democrats Republicans 

National Committee II Contributions 

~ Coordinated 

~ Expenditures Senatorial Committee 

Congressional Committee 

State and Local 

Committees 

Millions of Dollars 

0 2 4 6 0 2 4 6 8 10

Total Democratic 

Support 

Total Republican 

Support 

0 5 10 15 20 

Millions of Dollars 

25 
31 

Political Action Committees 

Chart X 

Financial Activity of PACs, 1983·84 

Millions of Dollars 

110 ----··-·-··-···-···-·--~ -···-··~--···--·-..·-----·- [1] Receipts' 

100 

90 

80 

70 

60 

50 

40 

30 

20 

10 

~ Disbursements' 

fm Contributions• 

II Cash-on·Hand 

Corpora· Labor Noncon· Trade/Mem· Coopera· Corpora· 

tlons OrganI· nected bershlp/ tlves tlons 

zatlons Organl· Health Or· w/o 

zatlons ganlzatlons Stock 

Total Number 

of 1,809 438 1,146 757 58 139 

Commlttees3 

Number of 

Committees 

Making 1,521 289 517 575 50 94 

Contributions 

0 

'Receipts and disbursements do not include funds transferred between affiliated committees. 2lncludes contributions to committees of: 1984 House and Senate candidates; and all Federal candidates (for House, ~enate 

and Presidency) compaigning in future elections or retiring debts of former campaigns. 3lncludes total number of PACs active in Federal elections at any time between January 1, 1983, and December 31, 1984. Since 

some committees have terminated, this figure does not represent all committees active as of December 31, 1984. 
32 

Chart XI 

PAC Contributions to House and Senate Candidates, 1983·84 

Millions of Dollars 

50 ·~M·~-·WW·~~*'•*'< -·~· ••'0.W~W~W0-W ••·•~ <w<•< 0WwWM·•·• W••w• -···~·•·••••-•••·•--·---~-·--·-•-W<•W-•wW •<•••W••-·M-MWw ~Wwwww-~&.~M ·--· Status of Candidate 

Open Seat 

Challenger 

m. Incumbent 

Democratic Candidates Republican Candidates 
33 

Chapter 4 

The Commission 

Commissioners 

On August 9, 1985, President Reagan appointed 

Thomas J. Josefiak to serve as FEC Commissioner during the term ending April 30, 1991.1 

Commissioner Josefiak replaced Commissioner 

Frank P. Reiche, whose term ended on April 30, 

1985, and who continued to serve until Mr. 

Josefiak was named. 

Until his appointment, Commissioner Josefiak 

served as Special Deputy to the Secretary of the 

Senate, Jo-Anne L. Coe. (Under the law, the 

Secretary of the Senate serves as an ex officio 

member of the Commission.) On September 11, 

1985, Secretary Coe named Scott E. Morgan to 

replace Mr. Josefiak as Special Deputy. 

Commission Chairman John Warren McGarry 

and Vice Chairman Joan D. Aikens served from 

January through December 1985. On December 

18, 1985, the Commission elected Commissioner 

Aikens as 1986 Chairman and Commissioner 

McGarry as Vice Chairman. Biographies of all 

Commissioners appear in Appendix 1. 

Administrative Activities 

Relocation 

On November 25, 1985, the Commission began 

the first phase of a move to new headquarters-a 

renovated building located across the street from 

the FBI. By February 1986, the agency had completed its relocation to its new quarters at 999 E 

Street, N.W. The Commission decided to move 

after studying a report by The Cooper-Lecky Partnership, an architectural firm retained by the 

General Services Administration. The report 

pointed out numerous fire and safety hazards in 

the former building and recommended that the 

agency relocate. The new headquarters provide 

safe space while expanding areas for the general 

'The President appointed Commissioner Josefiak during a 

Congressional recess. His nomination is before the Senate for 

confirmation. 
34 

public. The Commission meeting room, the Public 

Records Office and the library now offer visitors 

more suitable quarters. 

Sunshine Act Regulations 

The Commission prescribed rev1s1ons to its 

regulations implementing the Sunshine Act on 

October 31, 1985, 30 days after their publication in 

the Federal Register (50 Fed. Reg. 39968). 

Consolidated under 11 CFR Part 2, the revised 

regulations clarify the distinction between matters that may be exempted from open meeting 

discussions under the Sunshine Act (discretionary exemptions) and matters that must be exempted under the confidentiality provision of the 

Federal Election Campaign Act (mandatory exemptions). In keeping with recent court decisions, 

the revised rules exempt from public meetings 

any discussion or materials that would reveal FEC 

enforcement guidelines because such disclosure 

would risk circumvention of the Act. 2 Additionally, 

the rules include a new provision that allows parties to request that a Commission meeting be 

closed if their interests are directly affected by 

the discussion. The Commission has discretionary power to close the meeting in such cases. 

The revised rules also explain more fully the 

FEC's procedures for releasing transcripts and 

recordings of closed meeting discussions once 

relevant disclosure exemptions cease to apply. 

Another provision clarifies that statements 

made by Commissioners and staff at meetings 

should not be construed as final FEC determinations or beliefs. The revised rules also make clear 

that notation voting by Commissioners, a method 

of expediting consideration of routine matters, is 

not considered a "meeting." 

Employee Conduct Regulations 

In an October 21, 1985, Federal Register notice, 

the Commission sought public comment on proposed regulations that would set forth guidelines 

governing standards of conduct for employees (50 

Fed. Reg. 42553). The agency's intent in drafting 

the proposed rules (11 CFR Part 7) was to 

"facilitate the proper performance of Commission 

business and encourage citizen confidence in the 

impartiality and integrity of the Commission." 

The proposed rules set out procedures for notifying employees about the standards of conduct 

and provide for an Ethics Officer to answer their 

questions. Other provisions specify procedures 

for reporting and handling alleged violations. 

A second subpart describes guidelines governing employee standards, specifying restrictions 

on employee activities outside the agency. Additionally, this subpart incorporates current FEC 

procedures that prohibit ex parte communications, i.e., informal communications between outside parties and FEC Commissioners and staff 

concerning pending enforcement matters. The 

Federal Register notice asked for public comment 

on whether the FEC's current ex parte procedures 

should be expanded to cover communications 

concerning advisory opinions and regulations. 

The final two subparts treat standards of conduct for temporary and former employees. 

Reorganization of Information Services 

On April 4, 1985, the Commission reorganized the 

Information Division. Under the new organization, 

the Press Office and the Clearinghouse on Election Administration, previously part of the Information Division, operate independently. Despite 

their similarity in providing information, the three 

offices address distinct audiences with separate 

demands: the press corps, election administrators and campaign finance practitioners. The 

reorganization permits the agency to meet their 

needs more effectively. 

2See Fund for a Conservative Majority v. FEC, summarized 

on page 15. 
35 

Congressional Oversight 

On November 7, 1985, Chairman Jc;>hn Warren 

McGarry and Vice Chairman Joan D. Aikens appeared at a hearing held by the Subcommittee on 

Elections of the Committee on House Administration. The hearing provided information to the oversight committee on the agency's implementation 

of the law. Chairman McGarry presented a written 

statement summarizing the FEC's recent activities and, with Vice Chairman Aikens, answered 

the panel's questions. Outside groups and individuals also participated in the hearing, which 

covered a wide range of topics. 

The Commission's Budget 

Fiscal Year 19853 

The Commission received a fiscal year (FY) 1985 

appropriation of $12.9 million. This amount, plus 

$116,000 in supplemental funds to cover part of 

the 1985 pay raise, brought the agency's total 

funding to $13.016 million. A portion of the funding was earmarked to cover the FEC's one-time 

relocation expenses. By the end of the fiscal year, 

the Commission had obligated most of this earmarked money but returned $340,000 to the 

Treasury. This amount, which was to cover increased rent at the new facility, was not needed 

during FY 1985 since the agency's move took 

place the following fiscal year. 

Although it controlled employment levels, 

averaging 241.8 full-time equivalent positions, the 

Commission did not sacrifice its output. The FY 

1985 workload exceeded that of FY 1984 and 

agency projections for FY 1985. For example, the 

agency reviewed 57,463 reports and statements 

during the fiscal year, an increase of 54.1 percent 

over FY 1984 and 55.3 percent over the FY 1985 

projection. 

Fiscal Year 1986 

During four congressional hearings held between 

March and May 1985, Vice Chairman Joan D. 

Aikens requested a $12.756 million budget for 

fiscal year 1986. Accompanied by Chairman John 

Warren McGarry, Mrs. Aikens testified that the 

budget request would provide the financial base 

necessary for "steady-state" maintenance of 

agency operations through the 1986 elections. 

Mrs. Aikens noted that the FEC's current 

budget represented only a tiny portion of the 

Federal government's total operating budget, i.e., 

one one-thousandth of one percent. "Humbling as 

this reality may be, it does not diminish the 

critical role the Commission plays in the 

American political process and the intense 

scrutiny to which our actions are subjected by the 

press, the regulated community and the Congress." She noted, for example, that since the 

FEC had first opened for business 10 years ago, 

the volume of campaign finance activity 

monitored by the agency over five election cycles 

had tripled. Moreover, "the FEC has administered 

the public funding program for three Presidential 

elections, assuring proper accountability for more 

than $300 million in public money .... " The agency has also handled an explosive increase in demand for information from the press and public. 

In favorably reporting a $12.745 million FY 1986 

authorization for the FEC in March, the Committee on House Administration noted that the agency had "exercised rigorous control over its 

budget" and stated that the FEC "should be CO!ll· 

mended for its excellent efforts in exercising its 

many responsibilities with a spartan budget and 

staff." The Senate Committee on Rules and Administration, in May 1985, endorsed an authorization of $12.605 million for FY 1986. In its report, 

the Committee expressed its appreciation of "the 

Commission's straightforward presentation of 

this year's budget request and of the [FEC's] 

assurances ... that it intends to return to the 

Treasury any funds designated for moving expenses and increased rent that will not be expend3See also Appendix 6. ed for these purposes in the current fiscal year." 
36 

(As previously mentioned, the Commission returned $340,000 in FY 1985 funds to the Treasury.) 

The House of Representatives failed to pass 

the Commission's authorization. While the vote 

was 263 to 160 in favor, a two-thirds majority was 

required. The Senate did not vote on the 

authorization bill. 

Instead of authorizing funding for the full fiscal 

year, Congress appropriated $12.433 million to the 

agency in a series of continuing resolutions. 

Because this amount was based on a proposed 

pay cut that was never enacted, the Commission 

requested, and the Administration recommended, 

a supplemental appropriation of $323,000. That request was still pending at the end of 1985.4 

Personnel and Labor Relations 

During 1985, the Commission continued its third 

year of on-campus recruitment for entry-level attorneys from a broad spectrum of backgrounds. 

As a means of implementing affirmative action in 

its employment practices, the agency sought out 

minority applicants. For example, FEC staff attended the northeast regional recruitment conference held by the Black Law Students Association. 

The agency also took steps to help the career 

development of FEC employees and began 

developing seminars designed to inform staff of 

possible career avenues within the agency. 

On the labor relations front, the Commission 

completed negotiations for two important 

agreements with Chapter 207 of the National 

Treasury Employees Union. One consisted of the 

renegotiation of the master labor agreement between the parties. In a cooperative effort, the 

agency and the union reached agreement in a few 

days, resulting in significant savings in time and 

money compared with the more typical protracted 

negotiations.5 The other agreement established 

policies and procedures covering employee working conditions at the agency's new headquarters. 

•As a result of the Gramm-Rudman-Hollings Act, the Presi· 

dent, on Feburary 1, 1966, signed an order that cut the Com· 

mission's FY 1986 budget by 4.3 percent ($535,000) and thus 

reduced its total funding to $11.898 million. Because of this 

measure, the Commission, on March 1, 1986, substantially cut 

back its disclosure program. 

5ln February 1986, the union ratified the contract, which 

was approved by the Commission In early March. 
37 

Chapter 5 

Legislative 

Recommendations 

The Federal Election Campaign Act requires the 

Commission to transmit each year to the President and Congress "any recommendations for 

any legislative or other action the Commission 

considers appropriate...." 2 U.S.C. Section 

438(a)(9). The recommendations in this chapter, 

approved by the Commission in March 1986, 

reiterate the recommendations submitted in 1985. 

Definitions 

Draft Committees 

Section: 2 U.S.C. §§431(8)(A)(i), 431(9)(A)(i), 

441a(a)(1) and 441b(b) 

Recommendation: Congress should consider the 

following amendments to the Act in order to prevent a proliferation of "draft" committees and to 

reaffirm Congressional intent that draft committees are "political committees" subject to the 

Act's provisions. 

1. Bring Funds Raised and Spent for Undeclared but Clearly Identified Candidates Within 

the Act's PuNiew. Section 431(8)(A)(i) should be 

amended to include in the definition of "contribution" funds contributed by persons "for the purpose of influencing a clearly identified individual 

to seek nomination for election or election to 

Federal office...." Section 431(9)(A)(i) should be 

similarly amended to include within the definition 

of "expenditure" funds expended by persons on 

behalf of such a "clearly identified Individual." 

2. Restrict Corporate and Labor Organization 

Support for Undeclared but Clearly Identified Candidates. Section 441b(b) should be revised to expressly state that corporations, labor organizations and national banks are prohibited from making contributions or expenditures "for the purpose of influencing a clearly identified individual 

to seek nomination for election or election ..." to 

Federal office. 

3. Limit Contributions to Draft Commitees. The 

law should include explicit language stating that 

no person shall make contributions to any committee (including a draft committee) established 

to influence the nomination or election of a clearly identified individual for any Federal office 

which, in the aggregate, exceed th~t person's 

contribution limit, per candidate, per election. 

Explanation: These proposed amendments were 

prompted by the decisions of the U.S. Court of Appeals for the District of Columbia Circuit in FEC v. 

Machinists Non-Partisan Political League and 

FEC v. Citizens for Democratic Alternatives in 

1980 and the U.S. Court of Appeals for the 

Eleventh Circuit in FEC v. Florida for Kennedy 

Committee. The District of Columbia Circuit held 

that the Act, as amended in 1979, regulated only 

the reporting requirements of draft committees. 

The Commission sought review of this decision 

by the Supreme Court, but the Court declined to 

hear the case. Similarly, the Eleventh Circuit 

found that "committees organized to 'draft' a person for federal office" are not "political committees" within the Commission's investigative 

authority. The Commission believes that the appeals court rulings create a serious imbalance in 

the election law and the political process because 

a nonauthorized group organized to support 

someone who has not yet become a candidate 

may operate completely outside the strictures of 

the Federal Election Campaign Act. However, any 

group organized to support someone who has in 

fact become a candidate is subject to the Act's 

registration and reporting requirements and contribution limitations. Therefore, the potential exists for funneling large aggregations of money, 

both corporate and private, into the Federal electoral process through unlimited contributions 

made to nonauthorized draft committees that support a person who has not yet become a candidate. These recommendations seek to avert that 

possibility. 
38 

Volunteer Activity 

Section: 2 U.S.C. §431(8)(8) 

Recommendation: Congress may wish to consider whether the exemption for volunteer activity, contained In 2 U.S.C. §431(8)(B)(i), was meant to 

include professional services donated primarily 

for fundraising purposes rather than for actual 

campaigning. 

Explanation: The Act places no limit on the services that a professional may donate to a candidate. For example, a professional entertainer 

may participate in a concert for the benefit of a 

candidate without the proceeds of that concert 

counting toward the entertainer's contribution 

limitations. Similarly, an artist may create artwork 

for a campaign to be used for fundraising or to be 

disposed of as an asset of the campaign. In both 

cases, the "volunteer" has thereby donated 

goods or services the value of which greatly exceeds the amount of the contributions which that 

individual or any other individual could otherwise 

make under the law. 

Registration and Reporting 

Commission as Sole Point of Entry for 

Disclosure Documents 

Section: 2 U.S.C. §432(g) 

Recommendation: The Commission recommends 

that it be the sole point of entry for all disclosure 

documents filed by Federal candidates and 

political committees. 

Explanation: A single point of entry for all 

disclosure documents filed by political committees would eliminate any confusion about where 

candidates and committees are to file their 

reports. It would assist committee treasurers by 

having one office where they would file reports, 

address correspondence and ask questions. At 

present, conflicts may arise when more than one 

office sends out materials, makes requests for additional information and answers questions 

relating to the interpretation of the law. A singl~ 

point of entry would also reduce the costs to the 

Federal government of maintaining three different 

offices, especially in the areas of personnel, 

equipment and data processinQ. 

The Commission has authority to prepare and 

publish lists of nonfilers. It is extremely difficult 

to ascertain who has and who has not filed when 

reports may have been filed at or are in transit between two different offices. Separate points of entry also make it difficult for the Commission to 

track responses to compliance notices. Many 

responses and/or amendments may not be received by the Commission in a timely manner, 

even though they were sent on time by the candidate or committee. The delay in transmittal between two offices sometimes leads the Commission to believe that candidates and committees 

are not in compliance. A single point of entry 

would eliminate this confusion. If the Commission received all documents, it would transmit on 

a daily basis file copies to the Secretary of the 

Senate and the Clerk of the House, as appropriate. The Commission notes that the report 

of the Institute of Politics of the John F. Kennedy 

School of Government at Harvard University, An 

Analysis of the Impact of the Federal Election 

Campaign Act, 1972-78, prepared for the House 

Administration Committee, recommends that all 

reports be filed directly with the Commission 

(Committee Print, 96th Cong., 1st Sess., at 122 

(1979)). 

Insolvency of Political Committees 

Section: 2 U.S.C. §433(d) 

Recommendation: The Commission requests that 

Congress clarify its intention as to whether the 

Commission has a role in the determination of insolvency and liquidation of insolvent political 

committees. 2 U.S.C. §433(d) was amended in 

1980 to read: "Nothing in this subsection may be 

construed to eliminate or limit the authority of the 
39 

Commission to establish procedures for-(A) the 

determination of insolvency with respect to any 

political committee; (B) the orderly liquidation of 

an insolvent political committee, and the orderly 

application of its assets for the reduction of 

outstanding debts; and (C) the termination of an 

insolvent political committee after such liquidation and application of assets." The phrasing of 

this provision ("Nothing ... may be construed 

to ... limit") suggests that the Commission has 

such authority in some other provision of the Act, 

but the Act contains no such provision. If Congress intended the Commission to have a role in 

determining the insolvency of political committees and the liquidation of their assets, Congress 

should clarify the nature and scope of this 

authority. 

Explanation: Under 2 U.S.C. §433(d)(1), a political 

committee may terminate only when it certifies in 

writing that it will no longer receive any contributions or make any disbursements and that the 

committee has no outstanding debts or obligations. The Act's 1979 Amendments added a provision to the law (2 U.S.C. §433(d)(2)) possibly permitting the Commission to establish procedures 

for determining insolvency with respect to 

political committees, as well as the orderly liquidation and termination of insolvent committees. 

In 1980, the Commission promulgated the "administrative termination" regulations at 11 CFR 

102.4 after enactment of the 1979 Amendments, in 

response to 2 U.S.C. §433(d)(2). However, these 

procedures do not concern liquidation or application of assets of insolvent political committees. 

Prior to 1980, the Commission adopted "Debt 

Settlement Procedures" under which the Commission reviews proposed debt settlements in 

order to detemine whether the settlement will 

result in a potential violation of the Act. If it does 

not appear that such a violation will occur, the 

Commission permits the committee to cease 

reporting that debt once the settlement and payment are reported. The Commission believes this 

authority derives from 2 U.S.C. §434 and from its 

authority to correct and prevent violations of the 

Act, but it does not appear as a grant of authority 

beyond a review of the specific debt settlement 

request, to order application of committee assets. 

It has been suggested that approval by the 

Commission of the settlement of debts owed by 

political committees at less than face value may 

lead to the circumvention of the limitations on 

contributions specified by 2 U.S.C. §§441 a and 

441b. The amounts involved are frequently substantial, and the .creditors are often corporate entities. Concern has also been expressed regarding 

the possibility that committees could incur further debts after settling some, or that a committee could pay off one creditor at less than the 

dollar value owed and subsequently raise additional funds to pay off a "friendly" creditor at full 

value. 

When clarifying the nature and scope of the 

Commission's authority to determine the insolvency of political committees, Congress 

should consider the impact on the Commission's 

operations. An expanded role in this area might 

increase the Commission's workload, thus requiring additional staff and funds. 

Waiver Authority 

Section: 2 U.S.C. §434 

Recommendation: Congress should give the Commission authority to grant general waivers or exemptions from the reporting requirements of the 

Act for classifications and categories of political 

committees. 

Explanation: In cases where reporting requirements are excessive or unnecessary, it 

would be helpful if the Commission had authority 

to suspend the reporting requirements of the Act. 

For example, the Commission has encountered 

several problems relating to the reporting requirements of authorized committees whose 

respective candidates were not on the election 

ballot. The Commission had to consider whether 

the election-year reporting requirements were ful-
40 

ly applicable to candidate committees operating 

under one of the following circumstances: 

• The candidate withdraws from nomination 

prior to his or her name placed on the ballot. 

• The candidate loses the primary and therefore is not on the general election ballot. 

• The candidate is unchallenged and his or her 

name does not appear on the election ballot. 

Moreover, a Presidential primary candidate who 

has triggered the $100,000 threshold but who is no 

longer actively seeking nomination should be 

able to reduce reporting from a monthly to a 

quarterly schedule. 

In some instances, the reporting problems 

reflect the unique features of certain State election procedures. A waiver authority would enable 

the Commission to respond flexibly and fairly in 

these situations. 

In the 1979 Amendments to the Act, Congress 

repealed 2 U.S.C. §436, which had provided the 

Commission with a limited waiver authority. There 

remains, however, a need for a waiver authority. It 

would enable the Commission to reduce needlessly burdensome disclosure requirements. 

Campaign-Cycle Reporting 

Section: 2 U.S.C. §434 

Recommendation: Congress should revise the 

law to require authorized candidate committees 

to report on a campaign-to-date basis, rather than 

a calendar year cycle, as is now required. 

Explanation: Under the current law, a reporter or 

researcher must compile the total figures from 

several year-end reports in order to determine the 

true costs of a committee. In the case of Senate 

campaigns, which may extend over a six-year 

period, this change would be particularly helpful. 

Monthly Reporting for Congressional Candidates 

Section: 2 U.S.C. §434(a)(2) 

Recommendation: The principal campaign committee of a Congressional candidate should have 

the option of filing monthly reports in lieu of 

quarterly reports. 

Explanation: Political committees, other than 

principal campaign committees, may choose 

under the Act to file either monthly or quarterly 

reports during an election year. Committees 

choose this option when they have a high volume 

of activity. Under those circumstances, accounting and reporting are easier on a monthly 

basis because fewer transactions have taken 

place during that time. Consequently, the committee's reports will be more accurate. 

Principal campaign committees can also have 

a large volume of receipts and expenditures. This 

is particularly true with Senatorial campaigns. 

These committees should be able to choose a 

more frequent filing schedule so that their reporting covers less activity and is easier to do. 

Monthly Reports 

Section: 2 U.S.C. §434(a)(3)(B) and (a)(4)(B) 

Recommendation: Congress should consider 

changing the reporting deadline for monthly filers 

to some earlier date in the month. 

Explanation: Throughout the years, reporters and. 

the public have indicated they would like to see 

financial data earlier than 20 days after the close 

of books. In the fast-paced Presidential primary 

period, in particular, by the time the 20-day report 

is filed, it is already out of date. In some cases, 

several primary elections have even passed during this interim. An earlier report would give the 

public more timely information without unnecessarily burdening the staff of political committees. 
41 

Reporting Payments to Persons Providing 

Goods and Services 

Section: 2 U.S.C. §434(b)(5)(A), (6)(A), (6)(8) 

Recommendation: The current statute requires 

reporting "the name and address of each ... person to whom an expenditure in an aggregate 

amount or value in excess of $200 within the 

calendar year is made by the reporting committee 

to meet a candidate or committee operating expense, together with the date, amount, and purpose of such operating expenditure." Congress 

should clarify whether this is meant, in all instances, to require reporting committees to 

disclose only the payments made by the committee or whether, in some instances, 1) the reporting 

committees must require initial payees to report, 

to the committees, their payments to secondary 

payees, and 2) the reporting committees, in turn, 

must maintain this information and disclose it to 

the public by amending their reports through 

memo entries. 

Explanation: The Commission has encountered 

on several occasions the question of just how 

detailed a committee's reporting of disbursements must be. See, e.g., Advisory Opinion 

1983-25, 1 Fed. Election Camp. Fin. Guide (CCH), 

para. 5742 (Dec. 22, 1983) (Presidential 

candidate's committee not required to disclose 

the names, addresses, dates or amounts of 

payments made by a general media consultant retained by the committee); Advisory Opinion 

1984-8, 1 Fed. Election Camp. Fin. Guide (CCH), 

para. 5756 (Apr. 20, 1984) (House candidate's committee only required to itemize payments made to 

the candidate for travel and subsistence, not the 

payments made by the candidate to the actual 

providers of services); Financial Control and Compliance Manual for General Election Candidates 

Receiving Public Financing, Federal Election 

Commission, pp. IV 39-44 (1984) (Distinguishing 

committee advances or reimbursements to campaign staff for travel and subsistence from other 

advances or reimbursements to such staff and requmng itemization of payments made by campaign staff only as to the latter). Congressional intent in this area is not expressly stated, and the 

Commission believes that statutory clarification 

would be beneficial. In the area of Presidential 

public financing, where the Commission is 

responsible for monitoring whether candidate 

disbursements are for qualified campaign expenses (see 26 U.S.C. §§9004(c) and 9038(b)(2)), 

guidance would be particularly useful. 

Verifying Multicandidate Committee Status 

Section: 2 U.S.C. §§438(a)(6)(C), 441 a(a)(2) and 441 

a(a)(4) 

Recommendation: Congress should consider 

modifying those provisions of the Act relating to 

multicandidate committees in order to reduce the 

problems encountered by contributor committees 

in reporting their multicandidate committee 

status, and by candidate committees and the 

Commission in verifying the multicandidate committee status of contributor committees. In this 

regard, Congress might consider requiring 

political committees to notify the Commission 

once they have satisfied the three criteria for 

becoming a multicandidate committee, namely, 

once a political committee has been registered 

for not less than 6 months, has received contributions from more than 50 persons and has contributed to at least 5 candidates for Federal office. 

Explanation: Under the current statute, political 

committees may not contribute more than $1,000 

to each candidate, per election, until they qualify 

as a multicandidate committee, at which point 

they may contribute up to $5,000 per candidate, 

per election. To qualify for this special status, a 

committee must meet three standards: 

• Support 5 or more Federal candidates; 

• Receive contributions from more than 50 contributors; and 

• Have been registered as a political committee for at least 6 months. 
42 

The Commission is statutorily responsible for 

maintaining an index of committees that have 

qualified as multicandidate committees. The index enables recipient candidate committees to 

determine whether a given contributor has in fact 

qualified as a multicandidate committee and 

therefore is entitled to contribute up to the higher 

limit. The Commission's Multicandidate Index, 

however, is not current because it depends upon 

information filed periodically by political committees. Committees inform the Commission that 

they have qualified as multi candidate committees 

by checking the appropriate box on their regularly 

scheduled report. If, however, they qualify shortly 

after they have filed their report, several months 

may elapse before they disclose their new status 

on the next report. With semiannual reporting in a 

nonelection year, for example, a committee may 

become a multicandidate committee in August, 

but the Commission's Index will not reveal this 

until after the January 31 report has been filed, 

coded and entered into thP. Commi~sion's computer. 

Because candidate committees cannot totally 

rely on the Commission's Multicandidate Index 

for current information, they sometimes ask the 

contributing committee directly whether the committee is a multicandidate committee. Contributing committees, however, are not always 

clear as to what it means to be a multicandidate 

committee. Some committees erroneously 

believe that they qualify as a multicandidate committee merely because they have contributed to 

more than one Federal candidate. They are not 

aware that they must have contributed to 5 or 

more Federal candidates and also have more than 

50 contributors and have been registered for at 

least 6 months. 

Local Party Activity 

Separate §441a(d) Limit for Local Party 

Committees In Presidential Elections 

Section: 2 U.S.C. §441a(d) 

Recommendation:1 Congress should amend the 

statute to provide a separate limit, under §441a(d), 

1Commissioners McDonald and Harris filed the following 

dissent: The Commission's legislative recommendation of a 

separate §441a(d) limit for a local party committee to the Congress would further expand "party building" loopholes already 

carved by Congress and certain rulings of the Commission. 

The Commission's recommendation would provide a local party with a small limit of its own in Presidential elections. 

· This recommendation has nothing to do with the real activities of local parties. We strongly support local parties and 

will work for any proposal that enhances their efforts to increase participation. This recommendation will only provide a 

means of circumventing the Presidential expenditure limits. 

Presently a local party may make expenditures for getout-the-vote activities involving volunteers in a Presidential 

campaign. The recommendation our colleagues have made 

would in no way build up these local parties and would quite 

likely make these committees merely another paper entity, existing only in a bank account, for their national party and its 

Presidential nominee. Section 441a(a)(4) of the FECA allows 

unlimited transfers between national, State and local committees of a political party. No definition of local party exists in 

the statute. Each precinct could form as many paper committees to receive national money as the national party desires. If 

the Commission's recommendation is enacted, an unlimited 

number of local committees could be formed and the national 

party could transfer the local limit to each local entity. This 

process could provide unlimited funds to a Presidential candidate in whatever locale desired, completely undermining the 

delicate balance constructed by Congress to provide each major party candidate for President with an equal amount of 

public funds. Under the present system, each party has ample 

ability to participate in the Presidential campaign through getout-the-vote activities and the national party §441a(d) limit 

(which is spent in local communities around the country 

selected by the national party). Local party headquarters are 

run on a ticket-wide basis and include the Presidential 

nominee in their efforts. Already corporate and labor funds are 

contributed to State and local parties to be used in a ratio of 

soft and hard money in the get-out-the-vote efforts in areas 

which are critical to the Federal candidates. Why do we need 

yet another loophole to give the Presidential campaigns 

unlimited spending power? 

If the Congress enacts this proposal, it will not increase 

activity at the local level; it will only increase the ability to circumvent the process at the national level. This result will limit 

participation in Presidential campaigns rather than broaden it. 
43 

on expenditures made by local party committees 

in the Presidential elections. 

Explanation: Local party committees share the 

State party's §441a(d) limit for Congressional 

elections but have no statutory role under that 

section for Presidential elections. The 1979 

Amendments to the Act did establish certain exemptions for State and local party committees, including a provision for get-out-the-vote activity 

during the Presidential election. The exemptions, 

however, are limited to activities involving 

volunteers. Payments for general public political 

advertising do not qualify under these provisions. 

Therefore, under the present statute, a local party 

which wants to purchase a newspaper ad on 

behalf of the party's Presidential nominee may 

make such an expenditure only when authorized 

to do so under the national party's §441a(d) limit. 

Many local committees are unaware of this 

restriction and make minor expenditures on 

behalf of the party's Presidential nominee, which 

are difficult for the national committee to track. It 

would be preferable for the local committees to 

have a small Presidential spending limit of their 

own (in addition to the Presidential spending limit 

given to the national party committees). This 

would aid national committees in administering 

their own 441a(d) limit for Presidential elections 

and avoid unnecessary compliance actions, while 

still ensuring that local parties do not introduce 

significant amounts of unreported (and possibly 

prohibited) funds into the Presidential election 

process. (It is assumed that the national committee would delegate its authority with respect to 

spending by State party committees in Presidential elections.) 

If Congress were to consider this recommendation, it would be necessary for Congress to define, 

with some degree of precision, "local party committee." 

Enforcement 

Modifying "Reason to Believe" Finding 

Section: 2 U.S.C. §437g 

Recommendation: Congress should consider 

modifying the language pertaining to "reason to 

believe," contained in 2 U.S.C. §437g, in order to 

reduce the confusion sometimes experienced by 

respondents, the press and the public. One possible approach would be to change the statutory 

language from "the Commission finds reason to 

believe a violation of the Act has occurred" to 

"the Commission finds reason to believe a violation of the Act may have occurred." Or Congress 

may wish to use some other less · invidious 

language. 

Explanation: Under the present statute, the Commission is required to make a finding that there is 

"reason to believe a violation has occurred" 

before it may investigate. Only then may the Commission request specific information from a 

respondent to determine whether, in fact, a violation has occurred. The statutory phrase "reason 

to believe" is misleading and does a disservice to 

both the Commission and the respondent. It implies that the Commission has evaluated the 

evidence and concluded that the respondent has 

violated the Act. In fact, however, a "reason to 

believe" finding simply means that the Commission believes a violation may have occurred if the 

facts as described in the complaint are true. An investigation permits the Commission to evaluate 

the validity of the facts as alleged. 

If the problem is, in part, one of semantics, it 

would be helpful to substitute words that sound 

less accusatory and that more accurately reflect 

what, in fact, the Commission is doing at this early phase of enforcement. 

In order to avoid perpetuating the erroneous 

conclusion that the Commission believes 

a respondent has violated the law every time it 

finds "reason to believe," the statute should be 

amended. 
44 

Seeking Injunctions in Enforcement Cases 

Section: 2 U.S.C. §437g(a)(1) 

Recommendation:2 Congress should amend the 

enforcement procedures set forth in the statute 

so as to empower the Commission to promptly initiate a civil suit for injunctive relief in order to 

preserve the status quo when there is clear and 

convincing evidence that a substantial violation 

of the Act is about to occur. Under criteria expressly stated, the Commission should be authorized to initiate such civil action in a United States 

district court without awaiting expiration of the 15 

day period for responding to a complaint or the 

other administrative steps enumerated in the 

statute. The person against whom the Commis· 

sion brought the action would enjoy the procedural protections afforded by the courts. 

Explanation: On certain occasions in the heat of 

the campaign period, the Commission has been 

provided with information indicating that a viola· 

tion of the Act is about to occur (or be repeated) 

and yet, because of the administrative steps set 

forth in the statute, has been unable to act swiftly 

and effectively in order to prevent the violation 

form occurring. In some instances the evidence of 

a violation has been clearcut and the potential for 

an impact on a campaign or campaigns has been 

substantial. The Commission has felt constrained 

from seeking immediate judicial action by the requirements of the statute which mandate that a 

person be given 15 days to respond to a complaint, that a General Counsel's brief be issued, 

that there be an opportunity to respond to such 

brief, and that conciliation be attempted before 

court action may be initiated. The courts have indicated that the Commission has little if any 

discretion to deviate from the administrative procedures of the statute. In re Carter-Mondale 

Reelection Committee, Inc., 642 F.2d 538 (D.C. Cir. 

1980); Common Cause v. Schmitt, 512 F. Supp. 489 

(D.D.C. 1980), aff'd by an equally divided court, 455 

U.S. 129 (1982); Durkin for U.S. Senate v. FEC, 2 

Fed. Elec. Camp. Fin. Guide (CCH) para. 9147 

(D.N.H. 1980). The Commission suggests that the 

standards that should govern whether it may seek 

prompt injunctive relief (which could be set forth 

in the statute itself) are: 

1. There is a substantial likelihood that the 

facts set forth a potential violation of the Act; 

2. Failure of the Commission to act expeditiously will result in irreparable harm to a party 

affected by the potential violation; 

3. Expeditious action will not result in undue 

harm or prejudice to the interests of other persons; and 

4. The public interest would be served by expeditious handling of the matter. 

2Commissioner Elliott filed the following dissent: The Act 

presently enables the Commission to seek injunctive relief 

after the administrative process has been completed and this 

is more than sufficient. (See 2 U.S.C. §437g(a)(6)(A).) 

1am unaware of any complaint filed with the Commission 

during the last three years which, in my opinion, would meet 

the four standards set forth in the legislative recommendation. 

Assuming a case was submitted which met these standards, I 

believe it would be inappropriate for the Commission to seek 

injunctive relief prior to a probable cause finding. 

First, the very ability of the Commission to seek an injunc· 

tion, especially during the "heat of the campaign," opens the 

door to allegations of an arbitrary and politically motivated en· 

forcement action by the Commission. The Commission's deci· 

sion to seek an injunction in one case while refusing to do so 

in another could easily be seen by candidates and 

respondents as politicizing the enforcement process. 

Second, the Commission might easily be flooded with re· 

quests for injunctive relief for issues such as failure to file an 

October quarterly or a 12-day pre-general report. Although the 

Commission would have the discretion to deny all these requests for injunctive relief, in making that decision the Commission would bear the administrative burden of an immediate 

review of the factual issues. 

Third, although the courts would be the final arbiter as to 

whether or not to grant an injunction, the mere decision by the 

Commission to proceed to seek an injunction during the final 

weeks of a campaign would cause a diversion of time and 

money and adverse publicity for a candidate during the most 

important period of the campaign. 

For these reasons, I disagree with the recommendation to 

expand the power of the Commission to seek injunctive relief 

except as presently provided for in the Act. 
45 

Public Financing 

Fundralslng Limitation for Publicly Financed 

Presidential Primary Campaigns 

Section: 2 U.S.C. §§431(9)(A)(vi) and 441a 

Recommendation: The Commission recommends 

that the separate fundraising limitation provided 

to publicly financed Presidential primary campaigns be combined with the overall limit. Thus, 

instead of a candidate's having a $10 million (plus 

COLA3) limit for campaign expenditures and a $2 

million (plus COLA) limit for fundraising (20 percent of overall limit), each candidate would have 

one $12 million (plus COLA) limit for all campaign 

expenditures. 

Explanation: Campaigns that have sufficient 

funds to spend up to the overall limit usually 

allocate some of their expenditures to the fundraising category. These campaigns come close to 

spending the maximum permitted under both 

their overall limit and their special fundraising 

limit. Hence, by combining the two limits, Congress would not substantially alter spending 

amounts or patterns. For those campaigns which 

do not spend up to the overall expenditure limit, 

the separate fundraising limit is meaningless. 

Many smaller campaigns do not even bother to 

use it, except in one or two States where the expenditure limit is low, e.g., Iowa and New Hampshire. Assuming that the State limitations are 

eliminated or appropriately adjusted, this recommendation would have little impact on the election process. 

The advantages of the recommendation, 

however, are substantial. They include a reduction in accounting burdens and a simplification in 

reporting requirements for campaigns, and a 

reduction in the Commission's auditing task. 

State Expenditure Limits for Publicly Financed 

Presidential Primary Campaigns 

Section: 2 U.S.C. §441a 

Recommendation: The Commission recommends 

that the State-by-State limitations on expenditures for publicly financed Presidential primary 

candidates be eliminated. 

Explanation: The Commission has now seen three 

Presidential elections under the State expenditure limitations. Based on our experience, we 

believe that the limitations could be removed with 

no material impact on the process. 

Our experience has shown that the limitations 

have little impact on campaign spending in a 

given State, with the exception of Iowa and New 

Hampshire. In most other States, campaigns are 

unable or do not wish to expend an amount equal 

to the limitation. In effect, then, the administration of the entire program results in limiting 

disbursements in these two primaries alone. 

If the limitations were removed, the level of 

disbursements in these States would obviously 

increase. With an increasing number of primaries 

vying for a campaign's limited resources, however, it would not be possible to spend very large 

amounts in these early primaries and still have 

adequate funds available for the later primaries. 

Thus, the overall national limit would serve as a 

constraint on State spending, even in the early 

primaries. At the same time, candidates would 

have broader discretion in the running of their 

campaigns. 

Our experience has also shown that the limitations have been only partially successful in 

limiting expenditures in the early primary States. 

The use of the fundraising limitation, the compliance cost exemption, the volunteer service provisions, the unreimbursed personnel travel expense provisions, the use of a personal residence 

in volunteer activity exemption, and a complex 

series of allocation schemes have developed into 

an art which when skillfully practiced can partially circumvent the State limitations. 

•spending limits are increased by the cost-of-living adjustment (COLA), which the Department of Labor calculates annually. 
46 

Finally, the allocation of expenditures to the 

States has proven a significant accounting 

burden for campaigns and an equally difficult 

audit and enforcement task for the Commission. 

Given our experience to date, we believe that 

this change to the Act would be of substantial 

benefit to all parties concerned. 

Expenditure Limits 

Certification of Voting Age Population Figures 

and Cost-of-Living Adjustment 

Section: 2 U.S.C. §§441a(c) and 441a(e) 

Recommendation: Congress should consider 

removing the requirement that the Secretary of 

Commerce certify to the Commission the voting 

age population of each Congressional district. At 

the same time, Congress should establish a 

deadline of February 15 for supplying the Commission with the remaining information concerning the voting age population for the nation as a 

whole and for each State. In addition, the same 

deadline should apply to the Secretary of Labor, 

who is required under the Act to provide the Commission with figures on the annual adjustment to 

the cost-of-living index. 

Explanation: In order for the Commission to compute the coordinated party expenditure limits and 

the State-by-State expenditure limits for Presidential candidates, the Secretary of Commerce certifies the voting age population of the United 

States and of each State. 2 U.S.C. §441 a(e). The 

certification for each Congressional district, also 

required under this provision, is not needed. 

In addition, under 2 U.S.C. §441a(c), the 

Secretary of Labor is required to certify the annual 

adjustment in the cost-of-living index. In both instances, the timely receipt of these figures would 

enable the Commission to inform political committees of their spending limits early in the campaign cycle. Under present circumstances, where 

no deadline exists, the Commission has 

sometimes been unable to release the spending 

limit figures before June. 

Contributions 

Election Period Limitations 

Section: 2 U.S.C. §441a 

Recommendation: The Commission recommends 

that limits on contributions to candidates be 

placed on an election-cycle basis, rather than the 

current per-election basis. 

Explanation: The contribution limitations affecting contributions to candidates are structured on 

a "per-election" basis, thus necessitating dual 

bookkeeping or the adoption of some other 

method to distinguish between primary and 

general election contributions. The Act could be 

simplified by changing the contribution limitations from a "per-election" basis to an "electioncycle" basis. Thus, multicandidate committees 

could give up to $10,000 and all other persons 

could give up to $2,000 to an authorized committee at any point during the election cycle. 

Application of Contribution Limitations 

to Family Members 

Section: 2 U.S.C. §441 a 

Recommendation: The Commission recommends 

that Congress examine the application of the contribution limitations to immediate family members. 

Explanation: Under the current posture of the law, 

a family member is limited to contributing $1,000 

per election to a candidate. This limitation applies 

to spouses and parents, as well as other immediate family members. (SeeS. Conf. Rep. No. 

93-1237, 93rd Cong., 2nd Sess., 58 (1974) and 

Buckley v. Valeo, 424 U.S. 1, 51 (footnote 57) 

(1976).) This limitation has caused the Commis-
47 

sion substantial problems in attempting to implement and enforce the contribution limitations.4 

Problems have arisen in enforcing the limitations where a candidate uses assets belonging to 

a parent. In some cases, a parent has made a 

substantial gift to his or her candidate-child while 

cautioning the candidate that this may well 

decrease the amount which the candidate would 

otherwise inherit upon the death of the parent. 

The Commission recommends that Congress 

consider the difficulties arising from application 

of the contribution limitations to immediate family members. 

Foreign Nationals 

Section: 2 U.S.C. §441e 

Recommendation: Congress should examine the 

§441e prohibition on contributions by foreign nationals in connection with United States elections-Federal, State and local. In particular, 

Congress should consider three issues: 

1. Whether or not an American subsidiary of a 

foreign corporation should be allowed to make 

contributions directly (to State and local candidates) or to establish a separate segregated 

fund (SSF); and, if it does form an SSF, whether 

the activities of the SSF should be subject to 

special restrictions; 

2. Whether or not the statutory prohibition on 

contributions by foreign nationals is meant to 

cover volunteer activity by foreign nationals as 

well; and 

3. Whether or not the Act should continue to 

prohibit contributions by foreign nationals in connection with State and local elections. 

Explanation: These questions have pres~nted 

problems for the Commission and candidates, 

particularly since the legislative history is unclear 

in this area. 

Several issues have arisen during the Commission's administration of this provision. First, the 

law, as interpreted by Commission advisory opinions, permits an American subsidiary of a foreign 

registered corporation to influence elections 

either through direct contributions to State and 

local elections or by forming a separate 

segregated fund that supports Federal candidates. With regard to SSFs established by 

American subsidiaries, Commission advisory 

opinions have stipulated that the foreign corporate parent may not be the direct or indirect 

source of contributions; nor may it influence the 

SSF's decisions or exercise any control over the 

SSF. Further, the opinions have reiterated the 

law's requirement that only U.S. citizens (and individuals holding green cards) may contribute to 

the SSF. 

In another advisory opinion, the Commission 

has interpreted the Act to mean that a foreign national may not volunteer his services to a campaign. The standard under Section 441e bars contributions by a foreign national that are "in connection with" (rather than "for the purpose of influencing") a Federal election. It is unclear 

whether this distinction is intended to create a 

broader prohibition in the case of foreign nationals than for other activities under the Act. 

Finally, the Commission has recognized that it 

is difficult to enforce this provision with respect 

to State and local elections. Since only Federal 

candidates and committees report to the Commission, it is difficult for a Federal agency to 

monitor campaign financial activity affecting 

State and local elections. 

•While the Commission has attempted through regulations to present an equitable solution to some of these problems (see 48 Fed. Reg. 19019 (April 27, 1983) as prescribed by 

the Commission on July 1, 1983), statutory resolution is required in this area. 
48 

Acceptance of Cash Contributions 

Section: 2 U.S.C. §441g 

Recommendaton: Congress may wish to modify 

the statute to make the treatment of 2 U.S.C. 

§441g, concerning cash contributions, consistent 

with other provisions of the Act. As currently 

drafted, 2 U.S.C. §441g prohibits only the making 

of cash contributions which, in the aggregate, exceed $100 per candidate, per election. It does not 

address the issue of accepting cash contributions. Moreover, the current statutory language 

does not plainly prohibit cash contributions in excess of $100 to political committees other than 

authorized committees of a candidate. 

Explanation: Currently this provision focuses only 

on persons making the cash contributions. 

However, these cases generally come to light 

when a committee has accepted these funds. Yet 

the Commission has no recourse with respect to 

the committee in such cases. This can be a problem, particularly where primary matching funds 

are received on the basis of such contributions. 

While the Commission, in its regulations at 11 

CFR 110.4(c)(2), has included a provision requiring 

a committee receiving such a cash contribution to 

promptly return the excess over $100, the statute 

does not explicitly make acceptance of these 

cash contributions a violation. The other sections 

of the Act dealing with prohibited contributions 

(i.e., Sections 441b on corporate and labor union 

contributions, 441c on contributions by government contractors, 441e on contributions by 

foreign nationals, and 441f on contributions in the 

name of another) all prohibit both the making and 

accepting of such contributions. 

Secondly, the statutory text seems to suggest 

that the prohibition contained in §441g applies 

only to those contributions given to candidate 

committees. This language is at apparent odds 

with the Commission's understanding of the Congressional purpose to prohibit any cash contributions which exceed $100 in Federal elections. 

Fraudulent Misrepresentation 

Fundralslng Projects Operated by 

Unauthorized Committees 

Section: 2 U.S.C. §432(e)(4) 

Recommendations:5 Congress may wish to consider amending the statute, at 2 U.S.C §432(e)(4), 

to clarify that a political committee that is not an 

authorized committee of any candidate may not 

use the name of a candidate in the name of any 

"project" or other fundraising activity of such 

committee. 

Explanation: The statute now reads that a 

political committee that is not an authorized committee "shall not include the name of any candidate in its name [emphasis added]." In certain 

situations presented to the Commission the 

political committee in question has not included 

5Commissioner Elliott filed the following dissent: 1 support the policy underlying this legislative recommendation and 

recognize the seriousness of the problem necessitating such a 

recommendation. However, the scope of the recommendation 

is far too broa.d and inflexible given the traditional fundraising 

events, especially those held by political parties and some 

unauthorized political committees. Party committees are not 

authorized committees and therefore would come under the 

general prohibitions included in the recommendation, 

precluding the use of a candidate's name for any activity of a 

party committee. Oftentimes, however, fundraising events 

conducted by a party committee incorporate the name of a 

well-known Member of Congress as a fundraising tool. Typically, the fundraising contributions are made in the form of 

checks made payable to the name of the event, e.g., "Happy 

Birthday, Senator Smith"; "Mike's Annual Barbecue"·"Sail 

With Senator Sanford";"Aoast Aoberts."l do not believe' Congress intends to preclude the use of the candidates' names in 

such activities, especially when the candidate is not only 

aware that his/her name is being used but approves and is actively participating in the event. 

I would propose that the candidate be entitled to 

authorize the use of his or her name for such an event or activity provided the authorization is written. Again, 1 recognize the 

seriousness and the need to address this issue; however, Congress should not exclude fundraising tools which have been 

traditionally used by political committees. 

Further, the impact of this recommendation has not been 

evaluated in the context of our brand-new joint fundraising 

regulations. 
49 

the name of any candidate in its official name as 

registered with the Commission, but has 

nonetheless carried out "projects" in support of a 

particular candidate using the name of the candidate in the letterhead and text of its materials. 

The likely result has been that recipients of communications from such political committees were 

led to believe that the committees were in fact 

authorized by the candidate whose name was 

used. The requirement that committees include a 

disclaimer regarding nonauthorization (2 U.S.C. 

§441d) has not proven adequate under these circumstances. 

The Commission believes that the intent behind 

the current provision is circumvented by the 

foregoing practice. Accordingly, the statute 

should be revised to clarify that the use of the 

name of a candidate in the name of any "project" 

is also prohibited. 

Fraudulent Solicitation of Funds 

Section: 2 U.S.C. §441h 

Recommendation: The current §441h prohibits 

fraudulent misrepresentation, such as speaking, 

writing or acting on behalf of a candidate or committee on a matter which is damaging to such 

candidate or committee. It does not, however, prohibit persons from fraudulently soliciting contributions. A provision should be added to this 

section prohibiting persons from fraudulently 

misrepresenting themselves as representatives of 

candidates or political parties for the purpose of 

soliciting contributions which are not forwarded 

to or used by or on behalf of the candidate or party. 

Explanation: The Commission has received a 

number of complaints charging that substantial 

amounts of money were raised fraudulently by 

persons or committees purporting to act on 

behalf of candidates. Candidates have complained that contributions which people believed 

were going for the benefit of the candidate were 

diverted for other purposes. Both the candidates 

and the contributors were harmed by such diversion. The candidates received less money 

because people desirous of contributing believed 

they had already done so, and the contributors' 

funds had been misused in a manner in which 

they did not intend. The Commission has been 

unable to take any action on these matters 

because the statute gives it no authority in this 

area. 

Honoraria 

Technical Amendments 

Section: 2 U.S.C. §§431(8)(B)(xiv) and 441 i 

Recommendation: The Commission offers two 

suggestions concerning honoraria. 

1. Section 441i should be placed under the 

Ethics in Government Act. 

2. As technical amendments, Sections 441i(c) 

and (d), which pertain to the annual limit on receiving honoraria (now repealed), should be 

repealed. Additionally, 2 U.S.C. §431(8)(B)(xiv), 

which refers to the definition of honorarium in 

Section 441i, should be modified to contain the 

definition itself. 

Explanation: Congress eliminated the $25,000 annual limit on the amount of honoraria that could 

be accepted, but it did not take out these two sections, which only apply to the $25,000 limit. This 

clarification would eliminate confusion for officeholders and thereby help the Commission in 

its administration of the Act. 
50 

Commission Information Services 

Budget Reimbursement Fund 

Section: 2 U.S.C. §438 

Recommendation: 

1. The Commission recommends that Congress establish a reimbursement account for the 

Commission so that expenses incurred in preparing copies of documents, publications and 

computer tapes sold to the public are recovered 

by the Commission. Similarly, costs awarded to 

the Commission in litigation (e.g., printing, but 

not civil penalties) and payments for Commission 

expenses incurred in responding to Freedom of 

Information Act requests should be payable to the 

reimbursement fund. The Commission should be 

able to use such reimbursements to cover its 

costs for these services, without fiscal year 

limitation, and without a reduction in the Commission's appropriation. 

2. The Commission recommends that costs be 

recovered for FEC Clearinghouse seminars, 

workshops, research materials and other services, and that reimbursements be used to cover 

some of the costs of these activities, including 

costs of development, production, overhead and 

other related expenses. 

Explanation: At the present time, copies of 

reports, microfilm, and computer tapes are sold to 

the public at the Commission's cost. However, instead of the funds being used to reimburse the 

Commission for its expenses in producing the 

materials, they are credited to the U.S. Treasury. 

The effect on the Commission of selling materials 

is thus the same as if the materials had been 

given away. The Commission absorbs the entire 

cost. In FY 1984, in return for services and 

materials it offered the public, the FEC collected 

and transferred $86,984 in miscellaneous receipts 

to the Treasury. In FY 1985, the amount was 

$92,018 and during the first three months of FY 

1986, $24,232 was transferred to the Treasury. 

Establishment of a reimbursement fund, into 

which fees for such materials would be paid, 

would permit this money to be applied to further 

dissemination of information. Note, however, that 

a reimbursement fund would not be applied to the 

distribution of FEC informational materials to 

candidates and registered political committees. 

They would continue to receive free publications 

that help them comply with the Federal election 

laws. 

There is also the possibility that the Commission could recover costs of FEC Clearinghouse 

workshops and seminars, research materials, and 

reports that are now sold by the Government 

Printing Office and the National Technical Information Service. Approximately $15,000 was collected in FY 1981 by GPO and NTIS on account of 

sales of Clearinghouse documents. 

There should be no restriction on the use of 

reimbursed funds in a particular year to avoid the 

possibility of having funds lapse. 
51 

Appendix 1 

Biographies of 

Commissioners and 

Officers 

Commissioners 

John Warren McGarry, Chalr111an 

April 30, 19891 

Mr. McGarry, a native of Massachusetts, 

graduated cum laude from Holy Cross College in 

1952 and attended graduate school at Boston 

University. In 1956, he obtained a J.D. degree from 

the Georgetown University Law Center. Mr. 

McGarry was assistant attorney general of 

Massachusetts, serving as both trial counsel and 

appellate advocate, from 1959 to 1962. Following 

his tenure in office, he combined private law practice with service as chief counsel for the Special 

Committee to Investigate Campaign Expenditures 

of the U.S. House of Representatives. This committee was created by special resolution every 

election year through 1972 in order to oversee 

House elections. From 1973 until President Carter 

appointed him to the Commission in October 

1978, Mr. McGarry served as special counsel on 

elections to the Committee on House Administration of the U.S. Congress. He was reappointed as 

Commissioner for a six-year term in 1983. Mr. 

McGarry served as Chairman of the Commission 

in 1981 and 1985. He was elected to serve as the 

1986 Vice Chairman. 

Joan D. Aikens, VIce Chairman 

April 30, 1989 

Mrs. Aikens was formerly vice president of Lew 

Hodges/Communications, a public relations firm 

in Valley Forge, Pennsylvania. From 1972 until 

1974, she was president of the Pennsylvania 

Council of Republican Women and served on the 

board of directors of the National Federation of 

Republican Women. A native of Delaware County, 

Pennsylvania, Mrs. Aikens has been active in a 

variety of volunteer organizations. She received 

her B.A. and honorary Doctor of Laws degree from 

Ursinus College, Collegeville, Pennsylvania. 

Mrs. Aikens was first appointed to the Commission in 1975 and, upon the FEC's reconstitution in 

1976, was reappointed for five years. When that 

term expired in April1981, she continued to serve 

until President Reagan named her to complete the 

term of former Commissioner Max Friedersdorf, 

who had resigned in December 1980. In 1983, 

President Reagan again reappointed Mrs. Aikens, 

this time for a six-year term. She served as Chairman between May 1978 and May 1979 and was 

elected 1986 Chairman. 

Lee Ann Elliott 

April 30, 1987 

Before her appointment to the Commission in 

December 1981, Mrs. Elliott served as vice president of the Washington firm Bishop, Bryant & 

Associates, Inc. From 1970 to 1979, she was 

associate executive director of the American 

Medical Political Action Committee, having 

served as assistant director from 1961 to 1970. 

Mrs. Elliott was on the board of directors of the 

American Association of Political Consultants 

and of the Chicago Area Public Affairs Group, of 

which she is a past president. She was also a 

member of the Public Affairs Committee of the 

Chamber of Commerce of the United States. In 

1979, she received the Award for Excellence in 

Serving Corporate Public Affairs from the National Association of Manufacturers. Mrs. Elliott, 

a native of St. Louis, Missouri, holds a B.A. from 

the University of Illinois. She also completed the 

Medical Association Management Executives 

Program at Northwestern University and is a Certified Association Executive. Mrs. Elliott served 

as Commission Chairman during 1984. 

Thomas E. Harris 

April 30, 1985 

Before serving on the Commission, Mr. Harris was 

associate general counsel to the AFL-CIO in 

Washington from 1955 to 1975. He had held the 

same position with the CIO from 1948 until it 

merged with the AFL in 1955. Before that, he was 

'Term expiration date. an attorney in private practice and with various 
52 

government agencies. A native of Little Rock, 

Arkansas, Mr. Harris is a 1935 graduate of Columbia University Law School. After graduation, he 

clerked one year for Supreme Court Justice 

Harlan F. Stone. 

Mr. Harris was originally appointed to the Commission for a four-year term and, when the agency 

was reconstituted in 1976, he received a threeyear appointment. In 1979, President Carter reappointed Mr. Harris for a six-year term. He was 

Commission Chairman from May 1977 to May 

1978. Although his term expired in April 1985, he 

continued to serve as Commissioner. 

Thomas J. Josefiak 

April 30, 1991 

Until his appointment as Commissioner in August 

1985, Mr. Josefiak served with the Commission as 

Special Deputy to the Secretary of the Senate. 

Before assuming that post in 1981, he was legal 

counsel to the National Republican Congressional Committee. His past experience also in· 

eludes positions held at the U.S. House of 

Representatives. He was minority special counsel 

for Federal election law to the Committee on 

House Administration and, before that, served as 

legislative assistant to Congressman Silvio 0. 

Conte. A native of Massachusetts, Commissioner 

Josefiak holds a B.A. degree from Fairfield University, Connecticut, and a J.D. degree from 

Georgetown University Law Center. 

Danny L. McDonald 

April ~0, 1987 

Mr. McDonald, as general administrator of the 

Oklahoma Corporation Commission, was responsible for the management of 10 regulatory divisions from 1979 until his appointment to ,the Commission in December 1981. He was secretary of 

the Tulsa County Election Board from 1974 to 

1979 and served as chief clerk of the board in 

1973. He also served as a member of the Advisory 

Panel to the FEC's National Clearinghouse on 

Election Administration. Mr. McDonald, a native 

of Sand Springs, Oklahoma, holds a B.A. from 

Oklahoma State University and attended the John 

F. Kennedy School of Government at Harvard 

University. He served as Commission Chairman 

during 1983. 

Frank P. Reiche 

April 30, 1985 

Before his appointment to the Commission in July 

1979, Mr. Reiche served as Chairman of the first 

New Jersey Election Law Enforcement Commission for six years. He had previously served in a 

variety of Republican Party positions, including 

eight years as a Republican County Committeeman. An attorney specializing in tax law, Mr. 

Reiche graduated from Columbia University Law 

School in 1959 and received a Master of Laws 

degree in Taxation from New York University in 

1966. He also holds a B.A. degree from Williams 

College and an M.A. in Foreign Affairs from 

George Washington University. From 1970 to 

1972, Mr. Reiche served as a member of New 

Jersey Governor William T. Cahill's blue ribbon 

Tax Policy Committee. He was a partner in the 

Princeton law firm of Smith, Stratton, Wise and 

Heher from 1964 until his 1979 appointment to the 

Commission. He served as Commission Chairman in 1982. 

Mr. Reiche continued to serve as Commissioner 

until August 1985, when he was succeeded by 

Commissioner Josefiak. 

Ex Officio Commissioners 

Jo-Anne L. Coe 

Ms. Coe was elected Secretary of the Senate on 

January 3, 1985. From 1976 until her election, she 

was Senator Robert Dole's administrative director 

and also served intermittently as administrative 

director of the Senate Finance Committee during 

Senator Dole's chairmanship. In 1980, she was 

deputy campaign manager for the Dole for Presi· 

dent committee and later served as an assistant 

to Elizabeth Hanford Dole, then director of public 

liaison for the Reagan for President Committee. 
53 

From 1976 to 1977, she was administrative assistant to the general counsel of the Commodity 

Futures Trading Commission. A graduate of 

William and Mary College in Virginia, Ms. Coe 

previously worked for Senator Dole from 1967 to 

1975. 

In September 1985, Ms. Coe appointed Scott E. 

Morgan, attorney, as the Special Deputy to the 

Secretary of the Senate. He replaced Thomas J. 

Josefiak, who had received an appointment as 

Commissioner in August. 

Benjamin J. Guthrie 

Mr. Guthrie became Clerk of the House of 

Representatives in January 1983, after having 

served as Sergeant at Arms of the House from 

1980 to 1982 and as printing clerk and director of 

the House Legislative Processes Office from 1957 

to 1980. He joined the House staff after 11 years 

with the U.S. Government Printing Office. A World 

War II veteran, Mr. Guthrie was with the U.S. 

Signal Corps from 1942 to 1946, after graduating 

from the Maryland State Teachers College in 

Salisbury. 

Douglas Patton, attorney, continued to serve at 

the Commission as Special Deputy to the Clerk of 

the House. 

Statutory Officers 

John C. Surlna, Staff Director 

Before joining the Commission in July 1983, Mr. 

Surina was assistant managing director of the Interstate Commerce Commission (ICC), where he 

was detailed to the "Reform 88" program at the 

Office of Management and Budget. In that role, he 

worked on projects to reform administrative 

management within the Federal government. 

From 1973 to 1980, Mr. Surina served the ICC in 

other capacities. Between 1972 and 1973, he was 

an expert-consultant to the Office of Control and 

Operations, EOP-Cost of Living Council-Pay 

Board. He was previously on the technical staff of 

the Computer Sciences Corporation. Mr. Surina 

joined the U.S. Army in 1966, completing hisservice in 1970 as executive officer of the Special 

Security Office. In that position, he supp'orted 

senior U.S. delegates to NATO's civil headquarters in Brussels, Belgium. 

A native of Alexandria, Virginia, Mr. Surina 

holds a B.S. in Foreign Service from Georgetown 

University. He also attended East Carolina University in Greenville, North Carolina, and American 

University in Washington, D.C. 

Charles N. Steele, General Counsel 

Mr. Steele became General Counsel in December 

1979, after serving as acting General Counsel during November of that year and as Associate 

General Counsel for Enforcement and Litigation 

between April1977 and October 1979. He received 

a B.A. from Harvard College in 1960 and an LL.B. 

from Harvard Law School in 1965. Before joining 

the Commission in 1976, Mr. Steele was a staff attorney with the appellate court branch of the National Labor Relations Board. 
55 

Appendix 2 

Chronology of 

Events, 1985 

January 

1-Commissioners John Warren McGarry 

and Joan D. Aikens begin one-year 

terms as Chairman and Vice Chairman, 

respectively. 

4-Commission publishes Federal Register notice on Common Causes's 

rulemaking petition on "soft money" 

(see also December 18). 

28-Commission releases statistics on 

number of PACs. 

31-1984 year-end report due. 

February 

11-Commission releases audit report on 

1984 Presidential primary campaign of 

George McGovern.1 

26-ln Fund for a ConseNative Majority v. 

FEC, U.S. district court upholds FEC's 

withholding of documents on internal 

audit procedures. 

March 

18-U.S. Supreme Court, in FEC v. NCPAC, 

rules 26 U.S.C. §9012(f) unconstitutional. 

19-Commission testifies on FY 1986 

budget request before Senate Appropriations' subcommittee and House 

Administration's subcommittee. 

27-Commission testifies on FY 1986 

budget request before House Appropriations' subcommittee. 

30-Louisiana holds special primary election in 8th Congressional District. 

April 

4-Commission reorganizes Information 

Services Division, dividing it into three 

independent parts: the Information 

Services Division, the Press Office and 

the Clearinghouse. 

14-Commission's 10th anniversary. 

16-Commission submits 1985 legislative 

recommendations to the President and 

Congress. 

17-Commission publishes Federal Register notice of proposed rulemaking on 

contribution limits. 

18-Commission revises internal enforcement procedures. 

24-Commission hears McGovern campaign's oral presentation disputing FEC 

determination on the repayment of 1984 

matching funds (see also June 13). 

May 

1-Commission publishes The First Ten 

Years, a special report marking its 10th 

anniversary, and State Access to FEC 

Data, a new brochure. 

2-Commission testifies on FY 1986 

budget request before the Senate Committee on Rules and Administration. 

7-Commission releases 1983-84 party 

committee statistics based on interim 

Reports on Financial Activity (RFA). 

16-Commission releases 1983-84 Congressional campaign statistics based on interim RFA. 

19-Commission releases 1983-84 PAC 

statistics based on interim RFA. 

22-Commission publishes Federal Regis• 

ter advance notice of proposed 

rulemaking on enforcement regulations. 

'The Commission released two audit reports on matching 

fund recipients in 1984: a report on Reubin Askew's campaign 

on August 2 and a report on Ernest Hollings' campaign on 

September 1 0. 
56 

June 

1-Commission publishes Annual Report 

1984. 

13-Commission rejects McGovern campaign's argument (see April 24) and 

makes final repayment determination. 

20-Commission releases audit report on 

Dallas host committee of the 1984 

Republican Presidential nominating 

convention. 

21-Commission publishes Federal Register notice announcing effective date 

(July 1) of revised testing-the-waters 

rules. 

25-Commission releases audit report on 

1984 Presidential primary campaign of 

Sonia Johnson. 

26-Commission prescribes revised rules 

governing the repayment of public 

funds. 

29-Texas holds special election in 1st Congressional District. 

July 

1-Commission's revised testing-thewaters regulations become effective. 

-Commission publishes vote counts in 

Federal Elections 84; Clearinghouse 

publishes Election Directory 85 and 

Computerizing Election Administration, 

Vol. 1: Current Applications. 

19-Commission releases audit report on 

1984 Presidential primary campaign of 

Jesse Jackson. 

31-ln FEC v. Massachusetts Citizens for 

Life, U.S. appeals court rules 2 U.S.C. 

§441b unconstitutional as applied to 

defendant's expenditures. 

-Semiannual report due. 

August 

3-Texas holds special runoff election in 

1st Congressional District. 

5-6-Clearinghouse Advisory Panel and Advisory Committee on Voting System 

Standards meet in Washington, D.C. 

9-President Reagan appoints Thomas J. 

Josefiak to succeed Commissioner 

Frank P. Reiche. 

19-Commission releases audit report on 

1984 Presidential primary campaign of 

John Glenn. 

-Commission releases statistics on 

number of PACs. 

22-Commission releases audit report on 

1984 Presidential primary campaign of 

Alan Cranston. 

September 

2-Commission begins subscription service providing direct, on-line access to 

FEC data base. 

5-Commission releases audit reports on 

convention and host committees for the 

San Francisco 1984 Democratic 

Presidential nominating convention. 

12-13-Commission cosponsors election law 

conference in Boston, Massachusetts. 
57 

October 

1-Commission publishes final rev1s1ons 

to Sunshine Act regulations in Federal 

Register and announces October 31 effective date. 

4-Commission releases statistics based 

on FEC 1983-84 Index of Independent 

Expenditures. 

9-Commission holds conference for trade 

associations and other incorporated 

membership groups at George Mason 

University in Virginia. 

16-Commission holds public hearing on 

regulations governing contribution 

limits. 

18-ln Gramm v. FEC, U.S. district court 

upholds FEC audit and subpoena 

powers. 

21-Commission publishes Federal 

Register notice of proposed rulemaking 

on regulations that set standards of 

conduct for FEC employees. 

23-ln Common Cause v. FEC, U.S. district 

court rules that 60-day limit on court 

challenges to FEC dismissals of complaints begins when FEC notifies complainant of dismissal. 

29-Commission releases audit report on 

1984 Presidential primary campaign of 

Lyndon LaRouche. 

31-Commission's revised Sunshine Act 

regulations become effective. 

November 

1-ln Carter/Mondale Presidential Committee v. FEC, U.S. appeals court upholds 

FEC decision not to reconsider repayment decision. 

6-Commission cosponsors election law 

conference in Denver, Colorado. 

7-Commission testifies at oversight hearing held by House Administration's subcommittee. 

23-Commission begins move to new headquarters. 

December 

1-Commission releases 1983-84 PAC 

statistics based on final Reports on 

Financial Activity (RFA). 

5-Commission releases 1983-84 party 

committee statistics based on final 

RFA. 

a-Commission releases 1983-84 Congressional campaign statistics based on 

final RFA. 

17-Commission elects Joan D. Aikens and 

John Warren McGarry as 1986 Chairman and Vice Chairman, respectively. 

18-Commission publishes Federal Register notice of inquiry on "soft money" 

and announces hearing date for 

January 29-30, 1986. 
The Commisioners 

John Warren McGarry, Chairman1 

Joan D. Aikens, Vice Chairman2 

Lee Ann Elliott, Commissioner 

Thomas E. Harris, Commissioner 

Thomas J. Josefiak, Commissioner3 

Danny L. McDonald, Commissioner 

Frank P. Reiche, Commissioner' 

Jo·Anne L. Coe, Ex Officio/Senate 

Benjamin J. Guthrie, Ex Officio/House 

I 

General Counsel 

Deputy Staff 

Director for 

Management 

~ Administration 

Data Systems 1-- Development 

Planning and ~ Management 

~ 

Staff Director 

Advisory 

Opinions 

Enforcement 

Litigation 

Regulations 

I 

-

~ -

1-- -

-

-

Audit 

Clearinghouse 

Information 

Public Disclosure 

Reports 

Analysis 

1--

1--

-

-

Commission 

Secretary 

Congressional 

and lntergovernmental Affairs 

Personnel and 

Labor/Management Relations 

Press Office 

59 

Appendix 3 

FEC Organization Chart 

1Commissioner McGarry was elected 1986 Vice Chairman. 2Commissioner Aikens was elected 1986 Chairman. 3Commissioner Josefiak was appointed in August 1985. 

•commissioner Reiche's term expired in April1985; he continued to serve until Commissioner Josefiak's appointment. 
61 

Appendix 4 

FEC Offices 

This appendix briefly describes the offices that 

make up the Commission. They are listed in 

alphabetical order. Local telephone numbers are 

given for offices that have extensive contact with 

the public. Commission offices can also be 

reached on the toll-free number, 800/424-9530. 

Administration 

The Administration Division is the Commission's 

"housekeeping" unit and is responsible for accounting, procurement and contracting, space 

management, payroll, travel and supplies. In addition, several support functions are centralized in 

the office, such as word processing, printing, 

document reproduction and mail services. The 

division also handles records management, inventory control and building security and maintenance. 

Audit 

Many of the Audit Division's responsibilities concern the public funding program. The division 

evaluates the matching fund submissions of 

Presidential primary candidates and determines 

the amount of contributions that may be matched 

with Federal funds. The division conducts the 

statutorily mandated audits of all publicly funded 

candidates and committees. 

In addition, the division audits committees 

when the review of reports indicates possible 

recordkeeping problems. Audit Division resources 

are also used in the Commission's investigations 

of complaints to verify committee accounting and 

bookkeeping records. Finally, the division conducts reviews of the internal finances of Commission offices. 

Clearinghouse 

The National Clearinghouse on Election Administration, located on the seventh floor, assists 

State and local election officials by responding to 

inquiries, publishing research and conducting 

workshops on all matters related to Federal election administration. (For a list of Clearinghouse 

studies, see Appendix 8.) Additionally, the Clearinghouse answers questions from the public on 

the electoral process. Local phone: 376-5670. 

Commission Secretary 

The Secretary to the Commission handles all administrative matters relating to Commission 

meetings, including agendas, documents, Sunshine Act notices, minutes and certification of 

Commission votes. The office also circulates and 

tracks numerous materials not related to 

meetings and records the Commissioners' tally 

votes on these matters. 

Commissioners 

The six Commissioners-three Democrats and 

three Republicans-are appointed by the President and confirmed by the Senate. Two ex officio 

Commissioners, the Secretary of the Senate and 

the Clerk of the House of Representatives, are 

nonvoting members. They appoint special 

deputies to represent them at the Commission. 

The six voting Commissioners serve full time 

and are responsible for overseeing administration 

of the Federal Election Campaign Act. They 

generally meet twice a week, once in closed session to discuss matters that, by law, must remain 

confidential, and once in a meeting open to the 

public. At these meetings, they formulate policy 

and vote on significant legal and administrative 

matters. 

Congressional, Legislative and 

Intergovernmental Affairs 

This office serves as primary liaison with Congress and Executive Branch agencies. In addition 

to preparing testimony, the office is responsible 

for keeping Members of Congress informed about 

Commission decisions and, in turn, for informing 

the agency on legislative developments. 

Data Systems Development 

This division provides computer support for the 

entire Commission. Its responsibilities are divided into two general areas. 
62 

In the area of campaign finance disclosure, the 

Data Systems Development Division (DSDD) 

enters into the computer data base information 

from all reports filed by political committees and 

other entities. DSDD is also responsible for the 

computer programs that sort and organize campaign finance data into indexes (described in Appendix 7). The indexes permit a detailed analysis 

of campaign finance activity and, additionally, 

provide a tool for monitoring contribution limitations. DSDD publishes the Reports on Financial 

Activity series of periodic studies on campaign 

finance and generates statistics for other publications. 

The division also provides computer support for 

the agency's administrative functions. These include management information and document 

tracking systems, along with personnel and 

payroll support. 

General Counsel 

The General Counsel directs the agency's enforcement activities and represents and advises 

the. Commission in any legal actions brought 

against it. The Office of General Counsel handles 

all civil litigation, including several cases which 

have come before the Supreme Court. The office 

also drafts, for Commission consideration, 

regulations and advisory opinions, as well as 

other legal memoranda interpreting the Federal 

Election Campaign Act. 

Information Services 

In an effort to promote voluntary compliance with 

the law, the Information Division provides 

technical assistance to candidates and committees and others involved in elections. Staff 

research and answer questions on the Federal 

Election Campaign Act and FEC regulations, procedures and advisory opinions; direct workshops 

on the law; and publish a wide range of materials. 

Located on the second floor, the division is open 

to the public. Local phone: 376-3120. 

Law Library 

The Commission law library, part of the Office of 

General Counsel, is located on the eighth floor 

and is open to the public. The collection includes 

basic legal research tools and materials dealing 

with political campaign finance, corporate and 

labor political activity and campaign finance 

reform. Library staff prepare an Index to Advisory 

Opinions and a Campaign Finance and Federal 

Elections Bibliography, both available for purchase from the Public Records Office. Local 

phone: 376-5312. 

Personnel and Labor/Management Relations 

This office handles employment, position 

classification, training and employee benefits. It 

also provides policy guidance on awards and 

discipline matters and administers a comprehensive labor relations program including contract 

negotiations and resolution of disputes before 

third parties. 

Planning and Management 

This office develops the Commission's budget 

and, each fiscal year, prepares a management 

plan determining the allocation and use of 

resources throughout the agency. Planning and 

Management monitors adherence to the plan, providing monthly reports measuring the progress of 

each division in achieving the plan's objectives. 

Press Office 

Staff of the Press Office are the Commission's official media spokespersons. In addition to 

publicizing Commission actions and releasing 

statistics on campaign finance, they respond to 

all questions from representatives of the print and 

broadcast media. Located on the first floor, the office also handles requests under the Freedom of 

Information Act. Local phone: 376-3155. 

Public Records 

Staff from the Public Records Office answer questions and provide information on the campaign 

finance activities of political committees and can-
63 

didates involved in Federal elections.1 Located on 

the first floor, the office is a library facility with 

ample work space and a knowledgeable staff to 

help locate documents. The FEC encourages the 

public to review the many documents available, 

including committee reports, computer indexes 

(see Appendix 7), closed compliance cases and 

advisory opinions. Local phone: 376-3140. 

Reports Analysis 

Reports analysts assist committee officials in 

complying with reporting requirements and conduct detailed examinations of the campaign 

finance reports filed by political committees. If an 

error, omission or prohibited activity (e.g., an excessive contribution) is discovered in the course 

of reviewing a report, the analyst sends the committee a letter that explains the mistake and asks 

for clarification. By sending these letters, the 

Commission seeks to ensure full disclosure and 

to encourage the committee's voluntary compliance with the law. Analysts also provide frequent telephone assistance to committee officials and encourage them to call the division 

with reporting questions or compliance problems. 

Local number: 376-2480. 

Staff Director and Deputy Staff Director 

The Staff Director carries the responsibilities of 

appointing staff, with the approval of the Commission, and implementing Commission policy. The 

Staff Director oversees the Commission's public 

disclosure activities, outreach efforts, review of 

reports and the audit program, as well as the administration of the agency. 

The Deputy Staff Director has broad responsibility for assisting in this supervision, particularly in the areas of budget, administration and computer systems. 

'Outside Washington, the public had access to the Commission's computer indexes through terminals located in 

several State election offices and through a subscription serv· 

ice. See pages 7 and 8. 
65 

Appendix 5 

S·tatistics on Commission 

Operations 

Summary of Disclosure Flies 

Total 

Fliers 

Exlatlnl 

In 198 

Fliers 

Termlnated 

aaof 

12/31/ 

85 

Con· 

tlnulng 

Fliers 

aaof 

12/31/ 

85 

Number 

of 

Reports 

end 

Statementa 

In 1985 

Grol8 

Recelpta In 

1985 

Gross 

Expenditures

In 1985 

Presidential 

candidates 

Committees 

278 

131 

147 

24 

1 

23 

254 

130 

124 

430 $7,954,756 $10,445,149 

Senate 

candidates 

Committees 

795 

378 

417 

141 

95 

46 

654 

283 

371 

1,027 $73,129,092 $41,309,938 

Houae 

candidates 

Committees 

3,482 

1,680 

1,802 

590 

406 

184 

2,892 

1,274 

1,618 

4,382 $71,624,287 $52,885,299 

Party 504 43 461 1,009 $231,892,354 $248,772,276 

Delegates 77 13 64 81 $1,382 $5,040 

Nonparty 

Labor Committees 

Corporate Committees 

Membership, Trade & Other Committees 

4,522 

444 

1,879 

2,199 

530 

56 

169 

305 

3,992 

388 

1,710 

1,894 

12,608 $146,488,774 $105,486,538 

Communication Coat Fliers 158 N/A N/A 180 N/A $30,224 

Independent Expenditures By Persona Other Than 

PoL'tlcal Cohtmltteea 61 N/A N/A 87 N/A $75,759 
66 

Divisional Statistics for Calendar Year 1985 

Total 

Reports Analysis Division 

Documents processed 39,096 

Reports reviewed 46,905 

Telephone assistance and meetings 6,357 

Requests for additional information (RFAis) 5,495 

Second RFAis 

Names of candidate committees published 

1,925 

for failure to file reports 

Compliance matters referred to the Office 

4 

of General Counsel or Audit Division 274 

Data Systems Development Division 

Documents receiving Pass I* coding 51,841 

Documents receiving Pass Ill* coding 38,165 

Documents receiving Pass I entry 46,353 

Documents receiving Pass Ill entry 38,207 

Transactions receiving Pass Ill entry* • 256,538 

Public Records Office 

Campaign finance material processed 

(total pages) 677,513 

Requests for campaign finance reports 6,617 

Visitors 9,069 

Total people served 15,686 

Information phone calls 13,707 

Computer printouts provided 78,805 

Total income (transmitted to U.S. Treasury) 

Cumulative total pages of documents 

$74,600 

available for review 6,034,655 

Contacts with State election offices 

Notices of failure to file with State 

3,120 

election offices 350 

Information Services Division 

Telephone inquiries 50,155 

Information letters 100 

Distribution of FEC materials 

Prior notices (sent to inform filers 

7,651 

of reporting deadlines) 14,091 

Other mailings 26,538 

Visitors 

Public appearances by Commissioners and 

122 

staff 60 

State workshops 3 

Publications 29 

Total 

Press Office 

Press releases 147 

Telephone inquiries from press 8,326 

Visitors to press office 1,354 

Freedom of Information Act (FOIA) requests 

Fees for materials requested under the FOIA 

135 

(transmitted to U.S. Treasury) $19,865 

Clearinghouse on Election Administration 

Telephone inquiries 1,997 

Information letters 211 

Visitors 65 

State workshops 1 

Office of General Counsel 

Advisory Opinions 

Requests pending at beginning of 1985 4 

Requests received 42 

Issued, closed or withdrawn••• 40 

Pending at end of year 

Compliance Cases (MURs)**** 

6 

Cases pending at beginning of 1985 172 

Cases opened 257 

Cases closed 292 

Cases pending at end of year 

Litigation 

137 

Cases pending at beginning of 1985 30 

Cases opened 37 

Cases closed 22 

Cases pending at end of year 45 

Cases won 15 

Cases lost 2 

Cases voluntarily dismissed 4 

Cases dismissed as moot 

Law Library 

1 

Telephone inquiries 1,911 

Visitors served 81)3 

*Computer coding and entry of campaign finance information 

occur in two phases. In the first phase, Pass I, summary information is coded and entered into the computer within 48 hours of the 

Commission's receipt of the report. During the second phase, 

Pass Ill, itemized information is coded and entered. 

**Pass Ill transactions are itemized transactions including 

contributions of $500 or more by individuals, as well as contributions, transfers and expenditures of any amount by various committees and other filers. 

• • *Thirty-six opinions were issued; four opinion requests were 

withdrawn or closed without issuance of an opinion. 

****For an explanation of MURs, see page 12. 
67 

Audita Completed by Audit Division 

1975-1985 

Total 

Presidential 52 

Presidential Joint Fundraising• 6 

Senate 12 

House 110 

Party (National) 41 

Party (Other) 98 

Nonparty (PACs) 80 

Total 379 

*Presidential joint fundraising committees are those estab· 

lished by two or more political committees, including at least one 

Presidential committee, for the purpose of raising funds jointly. 
69 

Appendix 6 

The FEC's Budget 

In fiscal year (FY) 1984, the Commission's original 

appropriation of $10.649 million, plus a supplemental appropriation of $95,000 to cover part 

of the 1984 pay raise, brought total funding to 

$10.744 million. 

The Commission received $13.016 million in FY 

1985 funds, consisting of an appropriation of 

$12.9 millon plus $116,000 in supplemental funds 

to cover part of the 1985 pay raise. The Commission returned to the Treasury $340,000, a portion 

of funds specially earmarked for one-time costs 

associated with the agency's relocation. The 

returned funds, slated to cover increased rent at 

the new facility, were not needed during FY 1985 

since the agency moved the following fiscal year. 

The table below compares functional allocations of budget resources for fiscal years 1984 

and 1985. The two charts that follow compare 

allocations of budget and staff by division for the 

fiscal year. 

FEC Budget 

Functional Allocation 

FY 1984 FY 1985 

Personnel compensation, 

including benefits 

Travel 

Transportation/motor pool 

Commercial space 

Equipment rental 

Printing 

Contracts 

Administrative expenses 

Supplies 

Ubrary materials 

Telephone, telegraph 

Postage 

Space rental 

Equipment purchases 

Training 

GSA, services, other 

$ 7,585,752 

212,960 

6,599 

14,674 

194,649 

281,900 

799,085 

66,437 

147,631 

60,234 

307,221 

125,000 

586,627 

205,178 

27,330 

95,435 

$ 8,357,724 

153,961

6,324 

14,085 

201,505 

272,300 

1,031,919 

173,589 

145,824 

80,161 

374,482 

103,057 

582,646 

809,030 

28,568 

340,352 

Total $10,716,712* $12,675,527* 

•unexpended funds were returned to the U.S. Treasury. 
70 

Divisional Allocation of Budget 

Commissioners 

Staff Director 

Office of General Counsel 

Administration' 

Audit 

Clearinghouse 

Data Systems Development 

Information 

Public Disclosure 

Reports Analysis 

Relocation2 

5 10 15 20 25 30 

Percent of Budget 

0 

0 FY 1984 

• FY 1985 

'Administration budget includes rent, supplies, services, etc. for the entire Commission . 

2This category represents the one-time costs of the agency's relocation. 

Divisional Allocation of Staff' 

0 FY 1984 

-FY 1985 

Commissioners 

Staff Director 

Office of General Counsel 

Administration 

Audit 

Clearinghouse 

Data Systems Development 

Information 

Public Disclosure 

Reports Analysis 

0 5 10 15 20 25 

Percent of Staff 

30 

'The Commission averaged 228.6 full-time equivalent positions (FTE) in FY 1984 and 241.8 

in FY 1985. 
71 

Appendix 7 

Computer Indexes 

The Public Records Office, using the FEC's computer system, produces printouts of the major 

disclosure indexes described below. 

Committee Names and Addresses 

The B Index includes the name and address of 

each committee, the treasurer's name, the committee I D number, the name of the connected 

organization (if any) and a notation if the committee is a "qualified" multicandidate committee, 

permitted to give larger contributions to candidates than other committees. There is a 

separate list for political action committees 

(PACs) and party committees. Another list arranges these committees by State. 

Candidate Names and Addresses 

The A Index is sorted by type of office sought 

(President, U.S. Senator, U.S. Representative) and 

alphabetically lists all candidates, including 

those not currently seeking election, whose committees have filed documents in the current election cycle. The printout lists, in addition to the 

candidate's name, his or her ID number, address, 

year of election and party affiliation. 

Current Election Candidate Names 

and Addresses 

The 415 Index is similar to the A Index (above) but 

lists only those candidates who have filed 

statements of candidacy for the current election 

cycle. 

Candidate Committees 

The Report 93 alphabetically lists Presidential, 

Senate and House candidates and includes, for 

each candidate, the ID number, address and party 

designation. Also listed are the name, address, ID 

number and treasurer's name of the principal 

campaign committee and of any other committees authorized by the candidate. 

Key Word in Committee Name 

The TEXT capability permits the computer to 

search and list all committee titles that include a 

word or phrase designated by the user. 

Treasurer's Name 

The computer searches and lists all committee 

treasurers with the same last name (designated 

by the user), the names of their committees and 

the committee ID numbers. 

Multlcandidate Committee Index 

This index lists political committees that have 

qualified as multicandidate committees and are 

thus permitted to contribute larger amounts to 

candidates than are other committees. Arranged 

in alphabetical order by name of committee, the 

list includes each committee's ID number, the 

date it qualified as a multicandidate committee 

and the name of its connected organization, if 

any. 

Chronology of New Committee Registrations 

The 3Y Index lists in chronological order the 

names of committees that have registered in the 

current election cycle. The list includes the date 

of registration and the committee's name, ID 

number, address and connected organization, if 

any. 

Recently Registered Committees 

The NULIST, printed weekly, lists the name, ID 

number, address and connected organization (if 

any) of committees that have registered during 

the previous week. 

Names of PACs and Their Sponsors 

The 35c Committee/Sponsor Index alphabetically 

lists the names of PACs along with their ID 

numbers and the names of their sponsoring or 

connected organizations. 
72 

Names of Organizations and Their PACs 

The 35o Sponsor/Committee Index alphabetically 

lists the names of organizations along with the 

names and 10 numbers of their PACs. 

Categories of PACs 

The Report 140 lists PACs by the category they 

selected on their registration statements. 

Categories include: corporation, labor organization, membership organization, trade association, 

cooperative and corporation without capital 

stock. The list includes the PAC's name, 10 

number and connected organization. 

Committee Disclosure Documents1 

The C Index includes, for each committee, its 

name and 10 number; a list of each document filed 

(name of report, period receipts, period disbursements, coverage dates, number of pages 

and microfilm location); and total gross receipts 

and disbursements. 

Committee Ranking by Receipts or Expenditures 

The Report 933 provides a list of the names of 

committees ranked in order of the highest total 

gross receipts. Because committees' reporting 

schedules differ, however, totals may represent 

different time periods. 

Candidate Campaign Documents1 

The E Index provides the following information on 

each candidate: 2 

1. Candidate name, State/district, party affiliation arid candidate 10 number. 

2. List of all documents filed by the candidate 

(statement of candidacy, etc.). 

3. List of all documents filed by the principal 

campaign committee (report type, coverage 

dates, period receipts and disbursements, 

number of pages and microfilm locations). 

4. List of all documents filed by other authorized committees of the same candidate (if any). 

5. List of all PACs and party committees contributing to the candidate's campaign and the aggregate total of all such contributions to date. The 

list includes the name of the connected organization of a contributing PAC. Also listed are committees making expenditures for or against the candidate, party committees making coordinated party expenditures (Section 441 a(d)) and aggregate 

totals spent to date. 

6. List of all persons and unauthorized single 

candidate committees reporting independent expenditures for or against the candidate. 

7. List of all persons and committees filing 

unauthorized delegate reports. 

8. List of all corporations and labor organizations reporting communication costs for or 

against the candidate. 

9. List of all unauthorized single candidate 

committees supporting or opposing the candidate and each committee's receipts and 

disbursements for the reporting period. 

Presidential Candidates 

The H Index on Presidential campaigns is similar 

to the E Index (above) but lists party and PAC contributions as reported by the Presidential candidates' authorized committees. 

Itemized Contrlbutions3 

The G Index identifies contributions of $500 or 

more received by a committee from individuals, 

the reports on which the transactions were 

disclosed and the microfilm locations of the 

reported entries. 1Direct, on-line access to this index was available through 

subscription and through several State election offices. See 

pages 7 and 8. 

"Information in items 1 through 4 comes from reports and 

statements filed by the candidate and his or her authorized 

committees. Sections 5 through 9 are based on data from 

reports filed by noncandidate committees and persons. 

'Direct, on-line access to this index was available through 

subscription and through several State election offices. See 

pages 7 and 8. 
73 

Individual Contributors 

The Name Search capability permits a person to 

request a computer search for a specific last 

name in the national alphabetical list of contributors. The printout lists all persons with that 

last name and includes: the person's full name, 

address and occupation; the date, amount and 

recipient of the contribution; and the microfilm 

location of the reported entry. There is a substantial charge for this index, but the national list of 

contributors, periodically microfilmed, is available for review in the Public Records Office at no 

charge. 

Committee Contributions to Candldates4 

The D Index includes, for each committee, its 

name, ID number, name of connected organization and notation if it is "qualified" as a multicandidate committee. The index also lists all candidates supported or opposed by a committee, 

together with total aggregate contributions to, or 

expenditures on behalf of or against, each candidate. In the case of party committees, coordinated party expenditures (Section 441a(d)) are 

listed in place of independent expenditures. 

Dates of Specific Contributions/Expenditures 

The Detailed D Index itemizes the information on 

the D Index (above). It lists in chronological order 

each contribution and expenditure made on 

behalf of a candidate, along with the date, amount 

and microfilm location of the reported entry. The 

index can also search for specific candidates. 

Total Contributions to Candidates by 

Selected Committees 

The Combined D Index permits a person to select 

a group of committees for research. The computer 

will add together all of their contributions to candidates and print them in one list identifying the 

total amount contributed to each candidate by the 

group of committees. 

Other Indexes 

In addition to the above indexes, the Commission 

produces other types of computer indexes on a 

periodic basis (e.g., an index of corporate/labor 

communication costs). These periodic indexes 

are available in the Public Records Office for inspection and copying. 

•Direct, on-line access to this index was available through 

subscription and through several State election offices. See 

pages 7 and 8. 
75 

Appendix 8 

Clearinghouse Studies 

The National Clearinghouse on Election Administration resumed publication of the FEC Journal of Election Administration in 1985. Suspended 

in 1981 due to budget restrictions, the Journal 

again offers a vehicle of communication within 

the election community. 

The Clearinghouse released other new publications in 1985 and continued its work on a number 

of other projects, described below. The appendix 

also lists past publications that are still available 

for purchase. 

Reports Completed in 1985 

Computerizing Election Administration 1: Current 

Applications is the first of a three-volume series 

to assist local election officials in automating 

their day-to-day activities. The first volume offers 

initial guidance by helping readers define their 

needs and also reports the results of a survey on 

computer applications conducted in 50 election 

jurisdictions. 

Election Directory 85 lists names, addresses 

and telephone numbers of Federal and State election officials; identifies Federal and State 

repositories of Federal campaign finance reports; 

and lists addresses where voter registration ·officials should forward cancellations of prior 

registrations of new residents. 

Designing Effective Voter Information Programs, the first volume of the Voter Information 

and Education Programs series, suggests inexpensive but effective ways for election officials to 

convey essential registration and election information to the public. 

Reports Under Way in 1985 

Voting System Standards, Phase I, Standards for 

the Hardware Elements of Punshcard and 

Marksense Voting Systems is the first of a 

multiphase project to develop voluntary standards for voting equipment. States or localities 

may adopt these standards in approving the use 

of voting equipment within their jurisdictions. The 

standards are intended to ensure the proper performance of the various voting devices on the 

market. 

Computerizing Election Administration 2: A 

General Model is the second volume in the computer application series. It builds on information 

presented in the first volume (see "Reports Completed in 1985," above) and enables readers to 

design a computerized election management 

system by selecting modules from a general 

model. 

Campaign Finance Law 86 summarizes each 

State's campaign finance provisions and provides 

convenient quick-reference charts on major 

features. 

Training Election Officials discusses economical and effective methods of training election 

workers and temporary staff, using a step-by-step 

approach. 

Previously Completed Reports 

The publications described below remain 

available. 

Campaign Finance Law 84 summarizes each 

State's campaign finance provisions and provides 

a convenient chart on State requirements. 

Voter Education Programs in the Schools, the 

second volume in the series Voter Information 

and Education Programs, suggests various ways 

election officials can develop, in cooperation with 

educators, good voter education programs in the 

schools. 

Statewide Registration Systems 1 and 2 is a 

report on computerized voter registration 

systems. Volume 1 examines problems involved 

in implementing a statewide system and offers 

suggestions for overcoming them. Volume 2 

describes in detail the forms, procedures, outputs 

and variations of a basic computerized system. 

Mail Registration Systems discusses problems 

involved in implementing a mail registration 

system, describing how such systems operate 
76 

and offering practical suggestions for overcoming 

difficulties. 

Contested Elections and Recounts is a threevolume analysis of the laws and procedures 

governing contested elections and recounts for 

Federal offices. Volume I examines issues and 

functions within the Federal government's purview and makes recommendations for improving 

the handling of contested elections at the Federal 

level. Volume II presents similar material at the 

State level, and Volume Ill summarizes State and 

Federal laws related to contested elections. 

Bilingual Election SeNices is a three-volume 

report on providing election services in languages 

other than English. Volume I summarizes such 

services since 1975. Volume II is a glossary of 

common election terms in English along with 

their Spanish and dialectal equivalents, and 

Volume Ill is a manual for local election officials 

that gives practical advice on identifying 

language problems and providing bilingual 

registration and balloting services. 

Election Administration, a four-volume set, 

covers planning, management and financial control concepts in local election administration. 

Volume I provides an overview of election functions and tasks and introduces the notion of a 

management cycle. Volume II focuses on planning, provides task/activity checklists and flow 

diagrams and discusses how tasks can be assigned. Volume Ill offers an accounting chart and 

shows how budgets can be prepared and costs 

monitored by applying the chart to each election 

function. Finally, Volume IV summarizes State 

code provisions on administrative and budgeting 

responsi bi I ities. 

Federal Elections 82 and Federal Elections 84 

summarize, by State, office and candidate, the 

results of the elections for U.S. President (1984 

edition), U.S. Senate and U.S. House of Representatives. 
Appendix 9 77 

FEC Federal Register 

Notices, 1985 

NotJce•· Title Pub R=ter Ffltlfnl 

tlon 

Date 

Citation 

1984-21** Rulemaking Petition: 

Notice of Availability; 

Issues Raised by 

Use of "Soft 

Money" in Elections 

1/4/85 50 FBd. Reg. 

477 

1984-22** Filing Dates for 

Louisiana Special 

Election 

2/6/85 50 FBd. Reg. 

5132 

1985-1 11 CFR Parts 9007 

and 9038: 

Repayments by 

Publicly Funded 

Presidential 

Candidates; Final 

Rule; Second 

Transmittal to 

Congress 

3/8/85 50 FBd. Reg. 

9421 

1985-2 11 CFR Parts 1 00 

and 101: Payments 

Received for 

Testing-the-Waters 

Activities; Final Rule; 

Transmittal to 

Congress 

3/13/85 50 FBd. Reg. 

9992 

1985-3 11 CFR Parts 2 and 

3: Sunshine Act 

Regulations; Scope 

and Definitions; 

Meetings; Second 

Notice of Proposed 

Rulemaking and 

Announcement of 

Hearing Date 

3/13/85 50 FBd. Reg. 

10066 

1985-4 11 CFR Part 110: 

Contribution and 

Expenditure Umits 

and Prohibitions; 

Contributions by 

Persons and 

Multicandidate 

Political Committees; 

Notice of Proposed 

Rulemaking 

4/17/85 50 FBd. Reg. 

15169 

Notice Title Citation Pu R:Cter Ffltlfnl

cation

Date 

1985-5 

1985-6 

1985-7 

11 CFR Part 111: 

Compliance 

Procedures; 

Advance Notice of 

Proposed 

Rulemaking 

5/22/85 50 FBd. Reg. 

21077 

Filing Dates for 

Texas Special 

Election 

6/11/85 50 FBd. Reg. 

24577 

11 CFR Parts 100 

and 101: Payments 

Received for 

Testing-the-Waters 

Activities; Final Rule; 

Announcement of 

Effective Date 

6/21/85 50 FBd. Reg. 

25698 

1985-8 11 CFR Parts 9007 

and 9038: 

Repayments by 

Publicly Funded 

Presidential 

Candidates; Final 

Rule; 

Announcement of 

Effective Date 

6/26/85 50 FBd. Reg. 

26354 

1985-9 Filing Dates for 

Texas Special 

Runoff Election 

7/15/85 50 FBd. Reg. 

28656 

1985-10 11 CFR Part 110: 

Contribution and 

Expenditure Umits 

and Prohibitions; 

Contributions by 

Persons and 

Multicandidate 

Political Committees; 

Announcement of 

Hearing Date 

7/18/85 50 FBd. Reg.

29232 

1985-11 11 CFR Parts 2 and 

3: Sunshine Act 

Regulations; Scope 

and Definitions; 

Meetings; Final 

Rule; 

Announcement of 

Effective Date 

10/1/85 50 FBd. Reg.

39966 

·Appendix does not include Federal Register notices of Commission meetings published under the Government in the Sunshine Act 

**Notices published in 1985 but assigned 1984 numbers. 
78 

Notice Title 

Federal 

Register 

Publication 

Date 

Citation 

1985-12 11 CFR Part 7: 10/21/85 50 Fed. Reg. 

Standards of 

Conduct for Agency 

Employees; Notice 

of Proposed 

Rulemaking 

42533 

1985-13 11 CFR Chapter 1: 12/12/85 50 Fed. Reg. 

Technical 

Amendments to 

Change Agency's 

Address; Final Rule 

50778 

1985-14 11 CFR Chapter 1: 12/18/85 50 Fed. Reg. 

Rulemaking Petition; 

Use of Funds to 

Influence Federal 

Elections; Notice of 

Inquiry 

51535