November 2008 Federal Election Commission Volume 34, Number 11

Table of Contents

(continued on page 2)

(continued on page 3)

 Reporting

1 Post-General Reporting Reminder

1 Advisory Opinions

 Court Cases

5 The Real Truth About Obama, Inc. 

v. FEC and U.S. Department of 

Justice

5 Fieger v. Attorney General, et al.

5 Koerber v. FEC

 

 Regulations

6 Notice of Proposed Rulemaking 

on Repeal of Millionaires’ 

Amendment Regulations

8 Commission Hearing on Proposed 

Rules for Bundled Contributions

 

 Legislation

9 Administrative Fine Program 

Extended to 2013

10 Index

Advisory 

Opinions

Reporting

Post-General Reporting 

Reminder

The 30-day Post-General Election 

report is due on December 4, 2008. 

The Post-General Election report 

covers activity from October 16 (or 

from the close of books of the last 

report filed) through November 24. 

The following committees must file 

this report: 

•	All registered PACs and party

committees—even committees 

with little or no activity to disclose. 

Monthly filers must submit this 

report in lieu of the December 

monthly report.1

•	Authorized committees of federal

candidates running in the general 

election, including committees of 

unopposed candidates. Note that 

because the reporting period for the 

Post-General Election report spans 

two election cycles, candidate committees must use the Post-Election 

Detailed Summary Page (FEC 

Form 3, Pages 5-8, or FEC Form 

3P, Page 3) instead of the normal 

Detailed Summary Page.

AO 2008-11

Federal Contractor May Not 

Make Contributions 

An individual who serves as a 

personal services contractor with the 

United States Agency for International Development (USAID) is 

considered a federal contractor under 

the Federal Election Campaign Act 

(the Act). As such, he is prohibited 

from making contributions for any 

political purpose.

Background

Mr. Lawrence Brown entered into 

a personal services contract with 

USAID in his individual capacity. 

The contract began in 2006 and is 

scheduled to end in September 2010. 

Under the contract, Mr. Brown is a 

senior Human Resources advisor for 

the USAID Bureau of Global Health, 

Office of Professional Development 

and Management Support. Payment 

for Mr. Brown’s services under the 

contract is made from funds appropriated by Congress. 

Analysis

The Act and Commission regulations prohibit federal government 

contractors from making contributions to any party, committee or 

candidate for federal office or to any 1

 Monthly filers are not required to file a 

December monthly report in addition to 

the Post-General report.
Federal Election Commission RECORD November 2008

2

Federal Election Commission

999 E Street, NW

Washington, DC 20463

800/424-9530 (Toll-Free)

202/694-1100 (Information Div.)

202/501-3413 (FEC Faxline)

202/219-3336 (TDD for the

 hearing impaired)

Donald F. McGahn II, Chairman

Steven T. Walther, Vice Chairman

Cynthia L. Bauerly, 

 Commissioner

Caroline C. Hunter, 

 Commissioner

Matthew S. Petersen, 

 Commissioner

Ellen L. Weintraub, 

 Commissioner

Joseph E. Stoltz,

 Acting Staff Director

Thomasenia Duncan, 

 General Counsel

Published by the Information

 Division of the Office of 

 Communications

Greg J. Scott, Assistant Staff

 Director

Amy L. Kort, Deputy Assistant 

 Staff Director

Myles G. Martin, Editor

http://www.fec.gov

Reports

(continued from page 1)

2

 “Overnight mail” includes Priority or 

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

which the report is scheduled for next 

business day delivery and is recorded in 

the service’s on-line tracking system.

Notification of Filing Deadlines

In addition to publishing this article, the Commission notifies committees of filing deadlines on its web 

site, via its automated Faxline and 

through reporting reminders called 

prior notices. Since January 1, 2007, 

prior notices have been distributed 

exclusively by electronic mail. They 

are no longer sent to committees 

via U.S. mail. See December 2006 

Record, page 1. For that reason, it 

is important that every committee 

update its Statement of Organization

(FEC Form 1) to disclose a current 

e-mail address. To amend Form 1, 

electronic filers must submit Form 1 

filled out in its entirety. Paper filers 

should include only the committee’s 

name, address, FEC identification 

number and the updated or changed 

portions of the form.

Treasurer’s Responsibilities

The Commission provides 

reminders of upcoming filing dates 

as a courtesy to help committees 

comply with the filing deadlines set 

forth in the Federal Election Campaign Act (the Act) and Commission 

regulations. Committee treasurers 

must comply with all applicable 

filing deadlines established by law, 

and the lack of prior notice does 

not constitute an excuse for failing 

to comply with any filing deadline. 

Please note that filing deadlines are 

not extended in cases where the filing deadline falls on a weekend or 

federal holiday. Accordingly, reports 

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

electronically, must be received by 

the Commission’s (or the Secretary 

of the Senate’s) close of business 

on the last business day before the 

deadline.

Filing Electronically

Under the Commission’s mandatory electronic filing regulations, 

individuals and organizations that

receive contributions or make expenditures, including independent 

expenditures, in excess of $50,000 in 

a calendar year—or have reason to 

expect to do so—must file all reports 

and statements with the FEC electronically. Reports filed electronically must be received and validated 

by the Commission by 11:59 p.m. 

Eastern Time on the December 4 

filing deadline. Electronic filers 

who instead file on paper or submit 

an electronic report that does not 

pass the Commission’s validation 

program by the filing deadline will 

be considered nonfilers and may 

be subject to enforcement actions, 

including administrative fines.

Senate committees and other 

committees that file with the Secretary of the Senate are not subject to 

the mandatory electronic filing rules, 

but may file an unofficial copy of 

their reports with the Commission in 

order to speed disclosure.

The Commission’s electronic 

filing software, FECFile, is free and 

can be downloaded from the FEC’s 

web site. New FECFile Version 

6.2.1.0 is available for download 

from the FEC web site at http://

www.fec.gov/elecfil/updatelist.html. 

All reports filed after June 9, 2008, 

must be filed in Format Version 6.2 

(the new version). Reports filed in 

previous formats will not be accepted. Filers may also use commercial or privately developed software 

as long as the software meets the 

Commission’s format specifications, 

which are available on the Commission’s web site. Committees using 

commercial software should contact 

their vendors for more information 

about the Commission’s latest software release.

Timely Filing for Paper Filers

Registered and Certified Mail.

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

before December 4 to be considered 

timely filed. A committee sending 

its reports by certified or registered 

mail should keep its mailing receipt 

with the U.S. Postal Service (USPS) 

postmark as proof of filing because 

the USPS does not keep complete 

records of items sent by certified 

mail.

Overnight Mail. Reports filed via 

overnight mail2

 will be considered 

timely filed if the report is received 

by the delivery service on or before 

the December 4 mailing deadline. 

A committee sending its reports by 

Express or Priority Mail, or by an 

overnight delivery service, should 

keep its proof of mailing or other 

means of transmittal of its reports.

Other Means of Filing. Reports 

sent by other means—including first 
November 2008 Federal Election Commission RECORD

3

(continued on page 4)

class mail and courier—must be 

received by the FEC (or the Secretary of the Senate) before close of 

business on the December 4 filing 

deadline. 2 U.S.C. §434(a)(5) and 11 

CFR 104.5(e). 

Paper forms are available at the 

FEC’s web site (http://www.fec.gov/

info/forms.shtml) and from FEC 

Faxline, the agency’s automated fax 

system (202/501-3413). The 2008 

Reporting Schedule is also available 

on the FEC’s web site (http://www.

fec.gov/info/report_dates.shtml), 

and from Faxline. For more information on reporting, call the FEC at 

800/424-9530 or 202/694-1100.

Filing Frequency for Party 

Committees

National committees of political 

parties must file on a monthly schedule in all years. 11 CFR 104.5(c)(4). 

State, district and local party 

committees that engage in reportable 

federal election activity must automatically switch to a monthly filing 

schedule. Once a committee triggers 

the monthly filing requirement, a 

committee must file the next regularly scheduled monthly report and 

must continue to file monthly for the 

remainder of the calendar year.

Political Action Committees

PACs (separate segregated funds 

and nonconnected committees) may 

file on either a quarterly or monthly 

basis in election years. A committee may change its filing frequency 

only once a year. After giving notice 

of change in filing frequency to 

the Commission and receiving the 

Commission’s approval, all future 

reports must follow the new filing 

frequency. 11 CFR 104.5(c).

Additional Information

For more information on 2008 

reporting dates:

•	See the reporting tables in the

January 2008 Record;

•	Call and request the reporting

tables from the FEC at 800/424-

9530 or 202/694-1100;

•	Fax the reporting tables to yourself

using the FEC’s Faxline (202/501-

3413, document 586); or

•	Visit the FEC’s web page at http://

www.fec.gov/info/report_dates.

shtml to view the reporting tables 

online.

—Elizabeth Kurland 

Advisory Opinions

(continued from page 1)

person for any political purpose or 

use. 11 CFR 115.2. Specifically, the 

Act prohibits contributions by any 

person who enters into a contract 

with any department or agency of 

the United States for the rendition of 

personal services if the payment for 

the performance of the contract is 

to be made in whole or in part from 

funds appropriated by Congress. 2 

U.S.C. §441c(a).

Under government contract law, 

while the government is normally 

required to obtain its employees 

by direct hire under competitive 

appointment, it may obtain personal services by contract where 

“Congress has specifically authorized acquisition of the services by

contract.” 48 CFR 37.104(a).

Since Mr. Brown has entered into 

a written contract with USAID in his 

individual capacity and is paid with 

funds appropriated by Congress, 

he is considered a federal contractor under the Act and Commission 

regulations. As a federal contractor, 

he is prohibited from making contributions for any political purpose 

from either his business or personal 

funds. 2 U.S.C. §441c(a)(1); 11 

CFR 115.2(a), 115.5.

Date Issued: October 14, 2008;

Length: 4 pages.

 —Myles Martin

AO 2008-12

Independent Party of Oregon 

Qualifies as State Party 

Committee

The Independent Party of Oregon 

(the IPO) qualifies as a state party 

committee under the Federal Election Campaign Act (the Act). The 

IPO is not affiliated with a national 

political party, but such an affiliation 

is not needed to qualify as a state 

party committee under the Act and 

Commission regulations.

Background

The Act defines a “state committee” as “the organization

which, by virtue of the bylaws of 

a political party, is responsible for 

the day-to-day operation of such 

political party at the State level, as 

determined by the Commission.” 2 

U.S.C. §431(15). See also 11 CFR 

100.14(a).

The IPO is not affiliated with a 

national party, but qualifies under 

Oregon law as a “minor political 

party.” In order for a state party 

organization that is not affiliated

with a national party to achieve state 

committee status under Commission 

regulations, the organization must

meet three requirements. 

First, the organization must

qualify as a “political party” under 

the Act and Commission regulations. See AO 2007-23. The Act and 

Commission regulations define a 

“political party” as an “association, 

committee, or organization which

nominates a candidate for election 

to any Federal office, whose name 

appears on the election ballot as the 

candidate of such association, committee, or organization.” 2 U.S.C.

§431(16); 11 CFR 100.15.

Second, the organization must

itself possess an official party structure. 2 U.S.C. §431(15); 11 CFR 

100.14(a).

Third, the organization must

be responsible for the day-to-day 

operation of a political party at the 
Federal Election Commission RECORD November 2008

4

Advisory Opinions

(continued from page 3)

state level. See AOs 2000-21 and 

2000-14.

Analysis

The IPO meets all three requirements and thus qualifies as a 

political party under the Act and 

Commission regulations. It satisfies 

the first requirement because Mr. 

Joel Haugen will appear on Oregon’s 

2008 general election ballot as the 

party’s candidate for the U.S. House 

of Representatives.

The IPO satisfies the second 

requirement because its constitution 

and bylaws establish an official party 

structure. 

The IPO satisfies the third requirement because it is responsible 

for the day-to-day operation of a 

political party at the state level. The 

IPO’s constitution and bylaws set 

out a comprehensive organizational

structure for the party from the 

statewide level down through various local levels, and clearly identify 

the role of the IPO and its responsibilities for the day-to-day functions and operations of the political 

party at the state level. The IPO’s 

responsibility for the operations of 

the political party at the state level is 

commensurate with the responsibility of other state party committees 

that the Commission has previously 

recognized.

Date Issued: October 8, 2008;

Length: 4 pages.

 —Isaac J. Baker

AO 2008-13

Pacific Green Party of 

Oregon Qualifies as State 

Party Committee

The Pacific Green Party of Oregon (the PGPO) qualifies as a state 

party committee of the Green Party 

of the United States.

Background

The PGPO first applied for and 

received recognition as a state party 

affiliate of the Association of State 

Green Parties, the predecessor of the 

current Green Party of the United 

States (GPUS),1

 in November 2000. 

AO 2000-39. In September 2003 

the PGPO filed a termination report, 

and in October the Commission 

informed the PGPO it had accepted 

the report as valid termination of 

registration and advised the committee that if it again became active in 

federal elections, it would have to 

re-register as a new committee. The 

PGPO did re-register by filing a new 

Statement of Organization on FEC

Form 1 in July 2008.

Analysis

The Federal Election Campaign 

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

by virtue of the bylaws of a political 

party, is responsible for the day-today operation of such political party 

at the State level, as determined 

by the Commission.” 2 U.S.C. 

§431(15). A “political party” is an 

“association, committee, or organization that nominates a candidate for

election to any Federal office whose 

name appears on the election ballot 

as the candidate of such association, committee, or organization.” 2

U.S.C. §431(16); 11 CFR 100.15.

Thus, in order to achieve status 

as a state committee of a national 

party under Commission regulations, 

an organization must meet three requirements. First, the national party 

with which the state party organization is associated must itself be a 

“political party.” Second, the state 

party organization must be part of

the official structure of the national 

party. Third, the state party organization must be responsible for the

day-to-day operation of the national 

party at the state level.

PGPO meets the first requirement because the Commission 

recognized the national party status

of the GPUS in 2001. PGPO meets 

the second requirement because it is 

the GPUS’s sole recognized affiliate

in the state of Oregon, thus showing the PGPO’s role in the national 

party’s official structure. In order to 

meet the third requirement, a state 

party organization must have:

•	Bylaws or a similar document that

“delineates activities commensurate with the day-to-day operation” 

of a party at a state level; and

•	Ballot access for at least one federal candidate who has qualified 

as a candidate under Commission 

regulations.

The PGPO’s satisfies this requirement as well. Its bylaws set out a 

comprehensive organizational structure for the party from the statewide 

level down through local levels, and 

the bylaws clearly identify the role 

of the PGPO. Further, the PGPO 

has placed former Representative 

Cynthia McKinney on Oregon’s 

2008 general election ballot as the 

party’s Presidential candidate. Thus, 

the PGPO satisfies all three requirements and qualifies as a state committee of a political party. 

Date Issued: October 8, 2008;

Length: 5 pages.

 —Isaac J. Baker

1 The Commission has recognized the 

GPUS as a national committee of a political party since 2001. AO 2001-13.

Advisory Opinion Requests

AOR 2008-15

Corporate-funded advertisements 

as electioneering communications 

and/or independent expenditures 

(National Right to Life Committee, 

Inc., September 26, 2008)
November 2008 Federal Election Commission RECORD

5

Court Cases

The Real Truth About 

Obama, Inc. v. FEC and U.S. 

Department of Justice

On October 1, 2008, the U.S. 

Court of Appeals for the Fourth 

Circuit denied The Real Truth About 

Obama, Inc.’s (RTAO) motion for 

an injunction pending appeal and 

motion to expedite consideration of 

the case.

In July 2008, RTAO, a nonprofit 

“527” corporation, filed a complaint 

in the U.S. District Court for the 

Eastern District of Virginia challenging the constitutionality of three 

Commission regulations and an FEC 

“enforcement policy.” In September 2008, the district court denied 

RTAO’s motions for preliminary 

injunctions against the FEC and the 

Department of Justice. For additional information regarding this case, 

please consult the October 2008 

Record, page 11, at http://www.fec.

gov/pages/record.shtml. 

 —Michelle Ryan

Fieger v. U.S. Attorney 

General, et al.

On September 15, 2008, the U.S. 

Court of Appeals for the Sixth Circuit affirmed the decision of the U.S. 

District Court for the Eastern District of Michigan to dismiss Gregory 

N. Fieger and others’ (Plantiffs) 

suit. The district court ruled that the 

Federal Election Campaign Act (the 

Act) permits the Attorney General of 

the United States to conduct investigations into suspected criminal 

violations of campaign finance law 

without a referral from the FEC, and 

that the Plaintiffs are not entitled 

to have a court compel the FEC to 

review the case.

Background

In February 2007, the Plaintiffs 

filed suit against then-Attorney 

General Alberto R. Gonzalez and

Koerber v. FEC

On October 2, 2008, Committee 

for Truth in Politics, Inc.(CTP) and 

Holly Lynn Koerber (collectively the 

Plaintiffs) filed suit against the FEC 

in the U.S. District Court for the 

Eastern District of North Carolina. 

The suit challenges the constitutionality of the FEC’s disclaimer and 

(continued on page 6)

then-FEC Chairman Michael E. 

Toner. See May 2008 Record, page 

3, and August, 2008 Record, page 

8. The Plaintiffs sought judgment 

that the defendants acted contrary to 

the plain language of the Act, which 

the Plaintiffs assert bars the Attorney 

General from conducting an investigation of alleged violations of the 

Act until the FEC has investigated 

the matter itself and referred the 

matter to the Attorney General by an 

affirmative vote of four of its members. The Plaintiffs also asserted 

that the FEC’s failure to comply with 

the requirements of the Act violated 

the Administrative Procedure Act 

(APA), and sought an order from the 

district court compelling the FEC to 

perform its statutorily defined duties 

pursuant to the Act.

The Act established the FEC, 

which consists of six voting members, no more than three of whom 

may be affiliated with the same 

political party. If the FEC, through 

an affirmative vote of at least four of 

its members, determines that there is 

probable cause to believe there has 

been or is about to be a knowing and 

willful violation of the Act’s criminal provisions, the Commission may 

refer the violation to the Attorney 

General without regard to the Act’s 

conciliation provisions.

Analysis

The appeals court agreed with 

the analysis of the district court that 

the Act also does not limit in any 

way the Attorney General’s “plenary 

power” to enforce such criminal 

provisions of the Act. The appeals 

court also concluded that the plaintiffs’ insistence that the Act does not 

allow the Attorney General to prosecute violations of the Act without 

a referral from the FEC is without 

basis or merit, since Congress has 

vested in the Attorney General 

the power to conduct the criminal 

litigation of the U.S. Government. 

While Congress may delegate such 

authority to other executive agencies 

or offices, the Supreme Court has 

explained that this requires a “clear 

and unambiguous expression of the 

legislative will.”

The Act states that the FEC has 

“exclusive jurisdiction with respect 

to the civil enforcement” of the provisions of the Act. The Act, however, is silent with respect to criminal 

jurisdiction. The court concluded 

that the fact that Congress chose to 

vest exclusive civil jurisdiction in 

the Commission while including 

no analogous provision regarding 

criminal jurisdiction suggests that 

Congress did not intend to supplant 

the traditional criminal enforcement 

powers of the Attorney General with 

respect to the Act. In examining the 

legislative history of the Act and its 

amendments, the court concluded 

that Congress expressly decided 

against granting exclusive criminal 

jurisdiction to the FEC.

In an analogous case, Bialek v. 

Mukasey, the Tenth Circuit Court 

of Appeals also examined a 1977 

Memorandum of Understanding in 

which both the FEC and the Department of Justice acknowledged that 

the Attorney General “may investigate and prosecute knowing and 

willful violations [of the Act] without first exhausting FEC’s investigative and conciliation procedures.” 

The court in that case concluded 

that Congress intended to leave 

undisturbed the Justice Department’s 

authority to prosecute criminally a 

narrow range of aggravated violations of the Act. See August 2008 

Record, page 8.

U.S. Court of Appeals for the 

Sixth Circuit, CV 07-2291.

 —Myles Martin
Federal Election Commission RECORD November 2008

6

Court Cases

(continued from page 5)

reporting requirements for electioneering communications (ECs) that 

“may reasonably be interpreted as 

something other than as an appeal to 

vote for or against a specific candidate,” as described by the Supreme 

Court in FEC v. Wisconsin Right to 

Life (WRTL). 127 S. Ct. 2652, 2667 

(2007). The Plaintiffs also challenge 

the constitutionality of the Commission’s “enforcement policy”1

on political committee status. The 

CTP asks the court to declare that 

the ads described in their complaint 

are neither express advocacy nor 

electioneering communications subject to the prohibition on corporate 

treasury funding under WRTL, that 

the Federal Election Campaign Act’s 

disclosure requirements for such 

ECs are unconstitutional and that the 

FEC’s “PAC enforcement policy” 

is unconstitutional and beyond FEC 

authority under the Administrative 

Procedure Act.

Background

An electioneering communication (EC) is defined by the Federal 

Election Campaign Act (the Act) and 

FEC regulations as any broadcast, 

cable or satellite communication that 

refers to a clearly identified federal 

candidate and is publicly distributed 

within 30 days of a primary election 

or 60 days of a general election for 

the office sought by the candidate, 

and is targeted to the relevant electorate. 11 CFR 100.29(a). The Act 

and FEC regulations require disclosure of ECs that aggregate more than 

$10,000 in a calendar year. 2 U.S.C. 

§434(f)(1). In FEC v. Wisconsin 

Right to Life, the Supreme Court 

held that corporations and labor 

organizations cannot be prohibited

from using treasury funds to make 

an EC unless the EC is “susceptible 

of no reasonable interpretation other 

than as an appeal to vote for or 

against a specific candidate.” 127 

S.Ct. at 2667.

CTP is a nonstock, nonprofit 

North Carolina corporation that 

incorporated in September 2008. 

CTP states that it is presently engaging in “issue advocacy” advertising 

and that it has broadcast one ad that 

mentions Senator Barack Obama 

within 60 days of the November 

2008 general election and that it 

intends to broadcast another ad 

before the election. CTP states that 

it is currently including disclaimers 

on the ads, but is not disclosing them 

under the Act’s disclosure requirements for ECs. The complaint states 

that Holly Lynn Koerber is a resident 

of Elizabeth City, NC, one of the

places where CTP is broadcasting 

its ads, who wishes to exercise her 

“First Amendment right to continue hearing CTP’s issue-advocacy 

speech.”

Complaint 

The Plaintiffs seek a declaration 

from the court that the ads that CTP 

has run do not constitute express 

advocacy, as defined in Commission regulations at 11 CFR 100.22. 

CTP also maintains that the ads are 

ECs that are not subject to financing restrictions under the WRTL rule 

because they do not constitute an appeal to vote for or against a particular candidate. 

The Plaintiffs also seek a declaration from the court that the electioneering communication disclosure 

requirements are unconstitutionally 

overbroad as applied to ads that 

WRTL held are not subject to the EC 

financing restrictions.

CTP maintains that is not a political committee under the relevant law 

because it is neither controlled by a 

candidate nor does it have the “major purpose” of primarily engaging 

in regulable, election-related speech. 

CTP maintains that its activities will 

be nonpolitical intervention, including social welfare activities and 

lobbying. CTP seeks a declaration 

Regulations

Notice of Proposed 

Rulemaking on Repeal of 

Millionaires’ Amendment 

Regulations

On October 2, 2008, the Commission approved a Notice of Proposed 

Rulemaking (NPRM) that would 

implement the Supreme Court’s 

decision in Davis v. Federal Election 

Commission (Davis). The NPRM 

proposes deleting the Commission’s 

regulations implementing the Millionaires’ Amendment. Additionally, 

the Commission proposes to revise 

several regulations to conform to 

the Davis decision and retain others 

that were not affected by the Supreme Court’s ruling. Comments on 

the NPRM must be received by the 

Commission on or before November 

21, 2008.

Background

On June 26, 2008, the Supreme 

Court ruled in Davis that the Millionaires’ Amendment provisions 

of the Bipartisan Campaign Reform 

Act (BCRA) relating to House of 

Representatives elections unconstitutionally burden the First Amendment 

rights of self-financed candidates. 

Under the Millionaires’ Amendment, 

Senate and House candidates facing 

opponents who spent personal funds 

above certain threshold amounts 

were eligible for increased contribution and coordinated party expenditure limits. 

On July 25, 2008, the Commission issued a public statement 

1

 The complaint references the FEC’s 

Supplemental Explanation and Justification of its Political Committee Status 

rules, 72 FR 5595 (February 7, 2007).

from the court that the FEC’s PAC 

status enforcement policy is unconstitutional on its face and as applied 

and void for being beyond statutory 

authority.

U.S. District Court for the Eastern 

District of North Carolina, Northern 

Division, 2:08CV00039-BR.

 —Myles Martin
November 2008 Federal Election Commission RECORD

7

(continued on page 8)

announcing that the Davis decision 

precluded the enforcement of the 

House provision and effectively precluded the enforcement of the Senate 

provision. The statement noted that, 

as of June 26, 2008, the increased 

contribution limits and reporting 

requirements of the Millionaires’ 

Amendment were no longer in effect, and political party committees 

were no longer permitted to make 

increased coordinated party expenditures under these provisions. See 

August 2008 Record, page 3.

Proposed Removal of 11 CFR 

Part 400 – Increased Limits 

for Candidates Opposing SelfFinanced Candidates

Part 400 of FEC regulations 

implements the statutory provisions 

of the Millionaires’ Amendment. 

The Supreme Court’s decision in 

Davis invalidated the entire BCRA 

section 319 relating to House elections, including the increased limits 

in 319(a) and its companion disclosure requirements in 319(b). While 

the Davis decision struck down 

only the BCRA sections 319(a) and 

(b) governing House elections, the 

Commission believes that the Supreme Court’s analysis in Davis also 

precludes enforcement of the parallel provisions applicable to Senate 

elections. Therefore, the Commission proposes to delete regulations 

currently found at 11 CFR Part 400 

in their entirety.

Proposed Amendments to Other 

Provisions

The proposed deletion of current 11 CFR Part 400 affects several 

other Commission regulations, as 

noted below.

Definition of File, Filed or Filing. 

Section 100.19 specifies when a 

document is considered timely filed. 

The Commission proposes to delete 

paragraph (g), which describes the 

candidate’s notification of expenditures of personal funds under 400.21 

and 400.22.

Definition of Personal Funds. 

The term “personal funds” found 

in section 100.33 contains a crossreference to section 400.2. The 

Commission proposes deleting the 

cross-reference, while retaining 

the remaining language of section 

100.33.

Candidate Designations. On the 

Statement of Candidacy (FEC Form 

2), candidates are required by section 101.1(a) to disclose the amount 

by which the candidate intends to 

spend personal funds in excess of 

the threshold amount, as defined in 

400.9. The Commission proposes to 

delete the sentence within paragraph 

(a) referencing this disclosure.

Statement of Organization. 

Section 102.2(a)(1)(viii) requires 

principal campaign committees of 

House and Senate candidates to 

provide an e-mail address and fax 

number on their Statement of Organization (FEC Form 1). This regulation was promulgated to aid with 

the expedited notifications required 

by the Millionaires’ Amendment 

under Part 400. The Commission 

wishes to retain the requirement that 

these committees provide e-mail 

addresses, because it facilitates the 

exchange of information between 

the Commission and committees 

for other purposes under the Act. 

However, because the Commission 

does not routinely communicate 

with committees via facsimile, the 

NPRM proposes that the requirement for committees to provide fax 

numbers be deleted from paragraph 

(a)(1)(viii).

Calculation of “Gross Receipts 

Advantage.” Section 104.19 requires 

the principal campaign committees 

of House and Senate candidates to 

report information used to calculate 

their “gross receipts advantage.” 

This calculation is then used to 

determine the “opposition personal 

funds amount” under 400.10. With 

the Commission’s proposal to delete 

Part 400, the reporting under section 

104.19 would no longer be required. 

As such, the Commission proposes 

the deletion of section 104.19.

Biennial Limit. Section 110.5(b)

(2) states that contributions to candidates made by individuals under 

the increased limits provided in the 

rules at Part 400 are not subject to 

the individual biennial limit. With 

the proposed removal of Part 400, 

this exception would no longer exist, 

therefore the Commission proposes 

that paragraph (b)(2) be deleted from 

section 110.

Proposed Retention of Certain 

Other Regulations

Repayment of candidates’ personal loans. The BCRA added a new 

provision limiting to $250,000 the 

amount of contributions collected 

after the date of the election that can 

be used to repay loans made by the 

candidate to the campaign. When 

promulgating regulations to enforce 

this statutory provision, the Commission added new sections 116.11 

and 116.12 to the regulations rather 

than including them in Part 400 with 

the other Millionaires’ Amendment 

provisions. Unlike other aspects of 

the Millionaires’ Amendment, this 

statutory provision applies equally 

to all federal candidates, including 

Presidential candidates. The personal loan repayment provision was not 

challenged in Davis, nor did the Supreme Court’s decision address the 

validity of this provision. Therefore, 

the Commission proposes to retain 

sections 116.11 and 116.12 and 

seeks comment on this proposal.1

Net debts outstanding calculation. Section 110.1(b)(1)(i) states 

that candidates and their committees 

cannot accept contributions after the 

election unless the candidate still has 

net debts outstanding from that election and only up to the amount of 

1

 The proposal to retain sections 116.11 

and 116.12 is consistent with the approach the Commission took in AO 

2008-9, issued after the Millionaires’ 

Amendment was invalidated by the Davis decision. See October 2008 Record, 

page 9.
Federal Election Commission RECORD November 2008

8

Regulations

(continued from page 7)

that net debts calculation. This rule 

was in place before BCRA added the 

loan repayment restriction. However, 

to conform with the fundraising constraints put in place with the BCRA 

by section 116.11, the Commission 

added language to 110.1(b)(3)(ii) 

to exclude the amount of personal 

loans that exceed $250,000 from the 

definition of net debts outstanding. 

For the same reasons stated above, 

the Commission proposes to retain 

paragraph (b)(3)(ii)(C).

Expenditure Limitations. Limitations on expenditures from personal 

or family funds when a candidate 

has accepted matching funds in a 

Presidential primary election is outlined in section 9035.2(c). As part 

of the rulemaking implementing the 

Millionaires’ Amendment, the Commission changed the definition of 

personal funds applicable to FECA 

and moved it to current section 

100.33. At that time, the Commission felt it appropriate to change the 

cross-reference in section 9035.2(c) 

to the definition of personal funds 

in section 9003.2(c), which applies 

to Title 26 regulations. The Commission continues to believe this 

cross-reference is appropriate and 

therefore should be retained.

Additional Information

The full text of the NPRM was 

published in the October 20, 2008, 

Federal Register and is available on 

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

gov/law/law_rulemakings.shtml. 

All comments must be submitted 

in writing and addressed to Mr. 

Robert M. Knop, Assistant General 

Counsel, by November 21, 2008. 

Comments must be submitted via email, facsimile or paper copy form. 

Comments by e-mail must be sent to 

millionairerepeal@fec.gov. If e-mail 

comments include an attachment, the 

attachment must be in either Adobe 

Acrobat (.pdf) or Microsoft Word 

(.doc) format. Faxed comments must 

be sent to (202) 219-3923, with 

paper copy follow-up. Paper comments and paper copy follow-up of 

faxed comments must be sent to the 

Federal Election Commission, 999 

E Street, NW, Washington, D.C. 

20463. All comments (including 

those by e-mail) must include the 

full name and postal service address 

of the commenter or they will not be 

considered. The Commission will 

post comments on its web site after 

the comment period ends.

 —Elizabeth Kurland

Commission Hearing on 

Proposed Rules for Bundled 

Contributions

The Federal Election Commission 

held a public hearing on September 

17, 2008, on proposed rules governing the disclosure of information 

about lobbyists, registrants and the 

political action committees (PACs) 

of lobbyists and registrants that 

bundle contributions over a threshold amount during a covered period 

to certain committees.

The Commission published a 

Notice of Proposed Rulemaking 

(NPRM) on November 6, 2007, 

seeking public comment on the 

proposed regulations, which are in 

response to provisions of the Honest Leadership and Open Government Act of 2007 (HLOGA). The 

Commission received six comments 

from 11 commenters on the NPRM. 

Six of the commenters testified at 

the hearing and offered their views 

on the scope and substance of the 

proposed rules. The Commission 

reopened the record for one week 

after the hearing to receive further 

comments on issues discussed at the 

hearing. The Commission received 

two such comments during that 

period.

Background

HLOGA amends the Federal 

Election Campaign Act (the Act) to 

require candidates’ authorized committees, leadership PACs and political party committees to disclose 

information about each lobbyist and 

registrant, and each political committee the lobbyist/registrant establishes or controls, who forwards or 

is credited with raising two or more 

bundled contributions totaling more 

than $15,0001

 during a specific time 

period. Reporting committees must 

disclose the name and address of the 

lobbyist/registrant or lobbyist/registrant PAC, employer (for individual 

persons) and the aggregate amount 

of contributions bundled to the committee within the covered period. 

The NPRM proposes rules 

requiring the reporting of, and 

recordkeeping for, information about 

lobbyists/registrants and lobbyist/

registrant PACs that bundle contributions. For example, HLOGA 

requires the disclosure of information about a person who forwards, 

or is credited with raising, contributions if the person is “reasonably 

known” by the reporting committee 

to be a lobbyist/registrant or lobbyist/registrant PAC. The NPRM 

proposes rules to provide guidance 

about how a reporting committee 

can determine whether a person 

qualifies as a lobbyist, a registrant or 

a political committee established or 

controlled by a registrant or lobbyist and therefore must be identified 

on a filing. The Commission sought 

comments on this proposal and also 

specifically requested comments on 

proposed rules to define the terms 

used in HLOGA, among other issues 

discussed below. (See the December 

2007 Record, page 10).

Testimony Regarding Proposed 

Rules

Much of the hearing testimony 

centered on three broad concerns: 

how to define the concept of “crediting” a bundled contribution to a 

lobbyist/registrant or a lobbyist/registrant PAC; how to credit bundled 

1

 This amount is to be indexed for inflation annually, and thus the threshold 

amount may be different when the regulations take effect in early 2009.
November 2008 Federal Election Commission RECORD

9

(continued on page 10)

contributions to multiple lobbyists/

registrants who co-host an event; 

and whether the statute applies 

to contributions bundled by nonlobbyist employees of a registrant 

organization.

Definition of “credit.” Testimony 

focused on the issue of what “credit” 

means, in the context of the statutory language. Witnesses discussed 

whether “crediting” should be 

defined as mere knowledge on the 

part of the candidate or committee 

that the lobbyist/registrant raised a 

certain amount of money, or whether 

it should be defined to require 

something tangible, like a title for 

lobbyists/registrants who raise funds 

beyond certain thresholds or tickets to a special event. Don Simon, 

counsel to Democracy 21, told the 

Commissioners that if a lobbyist/

registrant verbally indicates to a 

Member of Congress that the lobbyist/registrant raised a certain amount 

of bundled contributions for that 

Member, but does not provide that 

information in writing, the Member 

should still be held accountable for 

knowing and designating those contributions as such. 

Timothy Jenkins of the Coalition 

for Tax Equity, told the Commissioners that a Member of Congress 

could not be held to such a standard. 

He said there needs to be a written 

record or other means to quantify the 

amount raised, otherwise the statute 

would be difficult to enforce.

Joseph Sandler of Sandler, Reiff 

& Young, P.C., said the issue of written versus oral designation of credit 

largely dissolves in practical application because most committees 

ensure they have a way of tracking 

who raises funds for them and how 

much.

Treatment of lobbyist/registrants 

who co-host events. The Commission requested comments on how 

the new law should be applied with 

regard to crediting multiple lobbyist/registrants who co-host a single 

fundraiser. For example, the Commission asked whether, if three 

lobbyist/registrants jointly co-host 

a fundraiser that raised $20,000 in 

contributions for Senator X, each of 

the three co-hosts should be deemed 

to have raised the entire $20,000 for 

reporting purposes. The Commission 

asked whether this approach would 

be misleading or inaccurate from a 

disclosure perspective and whether 

the sum total should instead be prorated among the three co-hosts. 

Mr. Simon, Mr. Sandler, Paul 

Ryan of the Campaign Legal Center 

and Craig Holman of Public Citizen

all spoke in favor of crediting each 

lobbyist/registrant with the entire 

amount of contributions raised at a 

multi-host event. They argued that 

prorating the sum total among the 

bundlers would, as Mr. Holman 

suggested, “distort the actual role 

of each bundler in the fundraising 

process.” 

In contrast, Mr. Jenkins told the 

Commissioners that the only way the 

Commission could accurately determine whether the bundling threshold 

of $15,000 is met is to prorate the total amount raised among the event’s 

multiple hosts. This method would 

also ensure that the funds raised at 

events with multiple hosts are accurately attributed to the separate 

hosts, he told the Commissioners.

Marc Elias of Perkins Coie expressed disapproval of both of these 

options. He told the Commissioners that the candidate or committee 

receiving the bundled contributions 

should determine how much credit 

to give each lobbyist/registrant, thus 

determining who and what must be 

disclosed. He pointed out that the 

recipient candidate or committee is 

in the best position to determine how 

much credit to give each fundraiser. 

Employees of lobbyists/registrants. Questions were also raised 

at the hearing concerning whether 

the statute (and the proposed regulations) would apply to non-lobbyist 

employees of a registrant organization. The questions centered on how 

to determine, for reporting purposes, 

whether an individual bundling 

contributions is doing so on his or 

her own behalf or on behalf of his or 

her employer. 

Mr. Jenkins said that disclosure 

should be required if, for example, a 

PAC supervisor or coordinator who 

is not a registered lobbyist bundles 

contributions on behalf of a registered lobbyist.

Mr. Sandler suggested that the 

regulations should outline “some 

objective criteria rather than leaving it to some sort of case-by-case 

investigation.” He suggested, as an 

example, “Possibly there should be 

a presumption that senior officers of 

the company, individuals involved in 

a government relations division of 

a company, should be presumed to 

be acting on behalf of, or acting as 

agents rather, for their company for 

purposes of the disclosure.”

Additional Information

The full text of the NPRM, 

written comments in response to 

the NPRM, a transcript of the FEC 

hearing and the witness’ supplemental written comments filed after 

the hearing are available at http://

www.fec.gov/law/law_rulemakings.

shtml#bundling.

 —Isaac J. Baker

Legislation

Administrative Fine 

Program Extended to 2013

On Thursday, October 16, 2008, 

President Bush signed H.R. 6296 

into law, extending the Commission’s Administrative Fine Program 

for late- and non-filed reports for 

an additional five years. Under the 

new law, the Administrative Fine 

Program will apply to reports covering periods that end on or before 

December 31, 2013. This bill, introduced by Representatives Robert 

Brady (PA), Vernon Ehlers (MI) and 

Zoe Lofgren (CA), provides the pro-
Federal Election Commission RECORD November 2008

10

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

the 2008 Record issue in which the 

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

the page number in that issue. For 

example, “1:4” means that the article 

is in the January issue on page four.

Administrative Fines

Update, 2:4; 4:9

Advisory Opinions

Alternative Disposition of Advisory 

Opinion Requests, AOR 2007-36, 

3:8; AOR 2008-1, 9:5; AOR 2008-

3, 8:10

2007-19: Nonprofit Corporation 

Qualifies as Membership Organization, 1:15

2007-22: Campaign Committee May 

Accept Volunteer Services from 

Foreign Nationals, 1:16

2007-23: State Party Committee 

Status for Independence Party of 

New York, 1:17

2007-24: Payment for Joint campaign Activities, 1:18

2007-25: Limited Liability Partnership Taxed as a Corporation, 2:7

2007-26: Disposal of Excess State 

Campaign Funds by Federal Candidate, 1:19

2007-27: Nonconnected Committee 

Solicitations for SSF ContribuIndex

tions, 2:8

2007-28: Federal Candidates/Officeholders Fundraising for Ballot 

Measure Committees, 2:8

2007-29: Donation to a Candidate 

for Local Party Office is Not Personal Use, 1:21

2007-30: Matching Credit Card 

Contributions Under Public Funding Program, 1:21

2007-31: Earmarked Contributions Forwarded to a Presidential 

Candidate by a Nonconnected 

Committee’s Checks Not Matchable, 2:9

2007-32: Political Committee Status 

of Independent Expenditure Organization, 3:8

2007-33: “Stand-By-Your-Ad” Disclaimer Required for Brief Television Advertisements, 9:1

2007-34: Federal Candidate’s Endorsement of Nonfederal Candidate, 2:10

2007-35: Internet Toolbar Affinity 

Program for Political Committees, 

3:8

2008-2: Eligibility for Candidate 

Salary Payments, 6:4

2008-4: Publicly Funded Presidential Candidate May Redesignate 

General Election Contributions to 

Senate Election Within 60 Days, 

10:1

2008-5: Organization’s Status as a

Partnership, 9:5

2008-6: Proposed Slate Card is 

Exempt Party Activity, 10:7

2008-7: Use of Campaign Funds for 

Legal and Media Expenses, 10:7

2008-8: Earmarked Contribution 

Counts Against Current Spending 

Limits, 10:8

2008-9: Application of Loan Repayment Provision, 10:9

2008-11: Federal Contractor May 

Not Make Contributions, 11:1

2008-12: Independent Party of 

Oregon Qualifies as State Party 

Committee, 11:3

2008-13: Pacific Green Party of 

Oregon Qualifies as State Party 

Committee, 11:4

Alternative Dispute Resolution

Update, 3:4; 5:4

Legislation

(continued from page 9)

gram with its longest extension since 

its inception.

The Administrative Fine Program 

was created in 1999 by amendments 

to the Federal Election Campaign 

Act that authorized the Commission

to assess civil money penalties for 

committees that failed to file reports 

on time or at all, and for campaign 

committees that failed to file 48-hour 

notices. 2 USC §437g(a)(4)(C); 11 

CFR 111.30 to 111.46. As of the 

end of fiscal year 2008, the Commission has assessed fines of $3,177,607 

and closed 1,641 cases under the 

Administrative Fine Program. 

As Representative Lofgren 

explained on the floor of the House 

of Representatives, the Administrative Fine Program “allows the FEC 

to quickly resolve minor violations 

of the [Federal Election Campaign 

Act] and concentrate its resources on 

more complex enforcement matters. The fines program also assures 

political and candidate committees 

that they can resolve minor errors 

by paying a fixed monetary penalty, 

avoiding a long and potentially complicated enforcement process.” She 

also explained that “there has been 

a significant decrease in the number 

of late and nonfiled reports since the 

start of this program.” Compared to 

increases in the number of political 

committees, the number of reports 

due, and the amount of financial 

activity disclosed on those reports, 

a decrease in the absolute number 

of late and nonfiled reports marks a 

significant achievement in encouraging compliance.

Representative Ehlers described 

H.R. 6296 and the Administrative 

Fine Programs as follows: “This 

bill is not a glamorous one... 

Nonetheless, it is an important 

program designed to protect our 

Nation’s campaign process from 

being thwarted by insisting upon the 

utmost transparency if an individual 

chooses to seek public office.”

At the Commission, the Administrative Fine Program has enjoyed 

bipartisan support. On four separate 

occasions, the Commission issued 

Legislative Recommendations seeking to extend or make it permanent, 

and each recommendation received 

a unanimous, bipartisan vote of the 

Commissioners. Additionally, during 2008, then-Chairman David Mason and Vice Chair Ellen Weintraub 

worked with Congress to ensure 

that it would renew the legislative 

authority for the Administrative Fine 

Program.

 —Myles Martin
November 2008 Federal Election Commission RECORD

11

Commission

Commission Amends Rules that 

Govern its Procedures, 3:3

Commission Publishes Notice of 

New and Revised Systems of 

Records, 2:4

Commission Statement on Davis v. 

FEC, 8:3

Message from the Chairman, 1:1

New Chairman Elected, 1:2

New Commissioners Join the Commission, 8:1

New Vice Chair Elected, 3:2

Compliance

MUR 5888: Failure to File Timely 

Under Millionaires’ Amendment, 

2:1

MUR 5895: Personal Use and Prohibited Contributions, 3:1

Nonfilers, 3:4; 4:9; 6:5; 7:6, 9:6, 

10:12

Correction

2008 Coordinated Party Expenditure 

Limits, 4:10

Court Cases

______ v. FEC

– Citizens United, 2:1

– Davis, 8:1

– DNC, 6:2, 8:8

– EMILY’s List, 9:1

– Hearn, 9:3

– Koerber, 11:5

– Morgan, 1:4

– The Real Truth About Obama, 

Inc., 9:3, 10:11, 11:5

– Schneider, 10:11

– SpeechNow.org, 4:6, 8:6

– Shays III, 6:1, 7:1

– Tierney, 5:2

Beam v. Gonzales, 5:3

Bialek v. Mukasey, 8:8

FEC v. ______

– Adams, 5:1

– Hearn, 1:5

– Reform Party of the USA, 4:1

Fieger v. Attorney General, et al., 

11:5

Marcus v. Mukasey, 5:3

Legislation

Administrative Fine Program Extended to 2013, 11:9

House Delegate for Northern Mariana Islands, 6:5

Outreach

Conference for Corporations and 

their PACs, 2:10

Conferences Scheduled for 2008, 

1:23; 2:11; 3:14; 4:10

June 23-24 Conference for Trade Associations, Membership Organizations and Labor Organizations,

5:6; 6:6

Orlando Regional Conference for 

House and Senate Campaigns, 

Political Party Committees and 

Corporate/Labor/Trade PACs, 

1:23

Roundtable on Pre-Election Communications, 8:10

Seminar for Nonconnected Political 

Action Committees, 4:10; 5:6

Party Activities

2008 Coordinated Party Expenditure 

Limits, 3:6; 4:10

Public Funding

Commission Approves Public Funds 

for McCain-Palin, 10:10

Commission Approves McCain 

Withdrawal from Matching Payment Program, 10:10

Commission Certifies Primary 

Matching Fund Payments, 2:3, 8:9

Dodd and Biden Certified for Matching Funds, 1:22

Kucinich and Hunter Certified for 

Matching Funds, 2:4

Regulations

Commission Hearing on Proposed 

Rules for Bundled Contributions, 

11:8

Final Rules and Explanation for 

Electioneering Communications, 

1:1

Notice of Proposed Rulemaking on 

Repeal of Millionaires’ Amendment Regulations, 11:6

Reports

April Reporting Reminder, 4:1

California Special Election Reporting: 12th District, 3:4

Illinois 14th District Special Election Reporting, 1:13

Indiana Special Election Reporting: 

7th District, 2:5

July Reporting Reminder, 7:1

Louisiana Special Election Reporting: 1st and 6th Districts, 2:6 

Louisiana Rescheduled Primary 

Elections, 10:4

Maryland Special Election Reporting: 4th District, 6:4

Mississippi Special Election Reporting: 1st District, 4:3

October Reporting Reminder, 10:1

Ohio Special Election Reporting: 

11th District, 10:3

Post-General Reporting Reminder, 

11:1

Reports Due in 2008, 1:5

Statistics

House and Senate Candidate Committees Raise $507 Million in 

2007, 5:1

Number of PACs Increases Slightly 

in 2007, 3:7

Number of Federal PACs Increases 

Slightly, 10:13

Party Activity Summary through 

April 2008, 7:5

Party Committee Contributions 

Update, 4:7

Party Committee Fundraising 

through June 30, 10:12

Web Site

Enhanced Presidential Campaign 

Finance Map, 6:5
Federal Election Commission RECORD November 2008

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