FEDERAL ELECTION COMMISSION WASHINGTON, D.C. 20463

 

MEMORANDUM October 19, 2020

TO: Patricia C. Orrock

 Chief Compliance Officer

 Dayna Brown

 Acting Assistant Staff Director

 Audit Division 

FROM: Neven F. Stipanovic 

 Associate General Counsel 

Policy Division 

 Lorenzo Holloway 

 Assistant General Counsel

 Compliance Advice

 Danita Alberico

 Attorney

 

SUBJECT: Draft Final Audit Report on Dr. Raul Ruiz for Congress (LRA 1120) 

I. INTRODUCTION

 The Office of the General Counsel has reviewed the proposed Draft Final Audit Report 

(“DFAR”) on Dr. Raul Ruiz for Congress. The DFAR contains two findings: Misstatement of Financial 

Activity (Finding 1) and Personal Use of Campaign Funds (Finding 2). We concur with the findings but 

provide additional analysis of Finding 2. If you have any questions, please contact Danita Alberico, the 

attorney assigned to this audit. 

II. PERSONAL USE OF CAMPAIGN FUNDS 

The Committee’s bank statements show that it made disbursements totaling $5,899 for vehiclerelated expenditures. The disbursements were for gasoline ($5,861), parking ($22), and insurance ($16). 

The Committee stated that the disbursements were campaign-related expenditures that were incurred 
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when Committee staff used their own vehicles while performing work for the Committee. The Audit 

Division found that the disbursements were a personal use of campaign funds and recommends that the 

Committee submit a contemporaneous log or other record for the vehicles documenting the dates and 

expenses related to the personal use of campaign funds, rather than for campaign or officeholder 

expenses, or demonstrating that the personal use expenses for the vehicles were of a de minimis amount. 

Commission regulations provide that if a committee uses campaign funds to pay expenses 

associated with a vehicle that is used for both personal activities beyond a de minimis amount and 

campaign or officeholder-related activities, the portion of the vehicle expenses associated with the 

personal activities is personal use unless the person(s) using the vehicle for personal activities 

reimburse(s) the campaign account within thirty days for the expenses associated with the personal 

activities. 11 C.F.R. § 113.1(g)(1)(ii)(D). For those uses of campaign funds that involve both personal 

use and either campaign or officeholder use, a contemporaneous log or other record must be kept to 

document the dates and expenses related to the personal use of funds. Id. § 113.1(g)(8). The log must 

be updated whenever campaign funds are used for personal expenses rather than for campaign or 

officeholder expenses. Id. In addition, the Committee must maintain records, including bank records, 

with respect to matters required to be reported, including vouchers, worksheets, receipts, bills and 

accounts, which shall provide in sufficient detail the necessary information and data from which the 

filed reports and statements may be verified, explained, clarified, and checked for accuracy and 

completeness. Id. § 104.14(b)(1).

The Committee contends that the Audit finding is not supported by law or facts for four reasons. 

First, the Committee states that the vehicle-related disbursements are not per se personal use and present 

no “special issue” of personal use since federal campaigns commonly incur expenses for fuel – the bulk 

of the expenses at issue here – to engage in campaign activity. Second, the Committee states that there 

is no general requirement that campaigns keep records to support individual fuel expenses. The 

Committee contends that such recordkeeping requirements apply only in circumstances involving 

campaign-owned vehicles, referencing Advisory Opinion 2001-03 (Meeks). Relatedly, the Committee 

also argues that the Commission has not given any notice that the recordkeeping requirement at 11 

C.F.R. § 113.1(g)(8) would apply to all gas purchases that a campaign committee incurs, including those 

that may be exclusively campaign related. Third, the Committee argues that even though the auditors 

acknowledge that the vehicle-related disbursements are not per se personal use, they incorrectly required 

the Committee to prove that the disbursements were not personal use. Fourth, the Committee asserts 

that the auditors wrongly rejected the declaration from its campaign manager attesting that the 

disbursements for gasoline were for campaign-related travel.

We concur with the Audit finding that vehicle-related disbursements are not per se personal use. 

The critical fact here, however, is that the vehicles involved were the personal vehicles of Committee 

staff. The Commission has made clear that expenses associated with personal vehicles generally are 

personal use “[b]ecause the expenses associated with a personal vehicle usually exist irrespective of the 

candidacy or the officeholder’s duties.” Expenditures; Reports by Political Committees; Personal Use of 

Campaign Funds, 60 Fed. Reg. 7862, 7869 (Feb. 9, 1995).

The Commission’s recordkeeping requirements are unambiguous regarding vehicle expenses 

involving a mix of personal use and either campaign or officeholder use. For such mixed use expenses, 
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the Committee must keep a contemporaneous log or other record documenting the dates and expenses 

related to the personal use of funds rather than for campaign or officeholder expenses, 11 C.F.R. 

§ 113.1(g)(8), and the Committee must maintain sufficiently detailed records for reporting purposes, 

including vouchers, receipts and bills, id. § 104.14(b)(1). 

The Committee’s second point that section 113.1(g)(8) does not apply because it pertains only to 

vehicles purchased with campaign funds is without merit. In support of this second point, the 

Committee cites Advisory Opinion 2001-03 (Meeks), which involved the use of campaign funds to 

purchase a vehicle for campaign related purposes and de minimis personal use of the vehicle. The issue 

is not whether a committee owns a vehicle, but whether a committee disburses campaign funds for 

vehicle-related expenses that are partly personal use. Disclaimers, Fraudulent Solicitation, Civil 

Penalties, and Personal Use of Campaign Funds 67 Fed. Reg. 76,962, 76,974 (Dec. 13, 2002). Here,

Committee funds were used to pay for vehicle-related expenses involving a mix of personal use and 

campaign use. Such mixed use vehicle expenses are subject to the recordkeeping requirements of 

section 113.1(g)(8). Logs help the Commission determine to what extent case-by-case expenses are 

personal in nature (including logs for expenses such as vehicle, legal, meals, and travel) when campaign 

funds are used for disbursements that may include a mix of personal use and either campaign or 

officeholder use. Id. Logs help the Commission distinguish personal uses from uses related to a federal 

officeholder’s duties. Id. 

We concur with the Audit Division’s decision not to accept the campaign manager’s declaration 

as a record documenting the personal use of campaign funds. The declaration does not document the 

dates and expenses related to personal use of funds for the vehicle-related disbursements or provide in 

sufficient detail the necessary information and data from which the filed reports and statements may be 

verified, explained, clarified, and checked for accuracy and completeness. 11 C.F.R. § 104.14(b)(1).