Federal Register / VoL 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations 43371

Independence Avenue, SW.,

Washington, D.C. 20250, (202) 447-4669.

The Final Impact Statement 

describing the options considered in 

developing this final rule and the impact 

of implementing each option is available 

on request from the Office of the Chief, 

Directives Management Branch, Farmers 

Home Administration, USDA, Room 

6346, South Agriculture Building, 

Washington, DC 20250.

SUPPLEMENTARY INFORMATION: This 

final action has been reviewed under 

USDA procedures established in 

Secretary’s Memorandum 1955 to 

implement Executive Order 12044, and 

has been classified “not significant.” On 

January 30,1980, FmHA published a 

proposal to the Federal Register (45 FR 

6972) to add Exhibit B to Subpart A of 

Part 1941, Chapter XVIII, Title 7, Code of 

Federal Regulations, to clarify the 

eligibility requirements for limited 

resource loans to operators of very 

small farm enterprises. This exhibit will 

supplement the existing individual 

operating loan eligibility requirements 

concerning farm training, income and 

the size of operation as they relate to 

limited resource operators of small farm 

enterprises in the seven States listed 

above.

Comments were received from the 

Sierra Club, Delta Chapter and the 

Consortium for the Development of the 

Rural Southeast.

The Sierra Club was concerned about 

loans being made to small farmers with 

enterprises in floodplain areas. FmHA 

does not anticipate any significant 

adverse impacts resulting from this 

action. <

The Consortium for the Development 

of the Rural Southeast recommended 

that:

(1) The 240 hours of formal training be 

reduced to 100-120 hours.

(2) The two years of intensive on-thejob training and management be 

reduced to 12 to 18 months as a 

maximum.

(3) The formal education and on-thejob training be provided simultaneously.

These recommendations were 

considered and the proposed rule 

material that was published in the 

Federal Register (45 FR 6972) on January 

30,1980, was revised to incorporate 

these recommendations.

Accordingly, Subpart A Part 1941 is 

amended as follows:

Table of Sections [Amended]

1. In the Table of Sections following 

Exhibit A” add “Exhibit B—Small Farm 

Enterprises. (Note: Exhibit B applies 

only in AL, FL, GA, LA, MS, MO and 

SC).”

§1941.4 [Amended]

2. In § 1941.4(g) add the following 

phrase at the end of the paragraph: “(For 

limited resource loans to applicants with 

small farm enterprises in AL, FL, GA,

LA, MS, MO and SC, refer to Exhibit B 

of this subpart)”.

Exhibit B [Added]

3. Exhibit B is added and reads as 

follows:

Exhibit B— Small Farm Enterprises

Individual Limited Resource Loans for

Small Farm Enterprises in Alabama, Florida,

Georgia, Louisiana, Mississippi, Missouri,

and South Carolina.

I. General

The Fanners Home Administration (FmHA)

wants to emphasize and encourage operating

loan assistance to eligible limited resource

applicants who operate small farm

enterprises in these States through December

31,1981, and wants to study and evaluate the

overall impact such assistance has on

stabilizing the financial position of small

farm operators. Some limited resource

applicants have very little farm experience or

training and may operate or propose to

operate very small farm enterprises'with

annual gross farm incomes as low as $3,000.

This Exhibit supplements the existing

individual operating loan eligibility

requirements concerning farm training,

income, and the size of operation as they

relate to limited resource operators of small

farm enterprises.

II. E ligibility

A. A limited resource applicant who

operates or will operate a small farm

enterprise must meet all operating loan

requirements. However, whether or not an

applicant meets these requirements must be

evaluated in relation to the size of the

applicant’s “farming operation. An applicant

with a small farm enterprise will not need as

much training or experience or income as

applicants with other farming enterprises.

B. A limited resource applicant operating a

small farm enterprise can meet the eligibility

requirement relating to training in

§ 1941.12(a)(3) of this subpart if the applicant

is a member of a responsible sponsoring

organization and has successfully completed

a minimum of 240 hours of formal and

informal training from the organization’s

professional staff. The formal training must

include a minimum of one hundred-twenty

hours of training on the enterprise(s) that will

be financed. The informal training will

consist of on the job supervision and

assistance. The applicant must also receive

intensive management assistance for the

small farm enterprise(s) that will be financed

from a qualified advisor of the sponsoring 

organization for at least two years. An

advisor must have a degree in agriculture or

equivalent experience managing the same

type of enterprise that will be financed.

Before loan approval, the County Supervisor

will obtain a letter from the sponsoring

organization certifying that its training staff

and advisors will provide the required

training and management assistance. There

must be a written agreement between the

County Supervisor and the sponsoring

organization if the two-year management

assistance requirement is reduced for

applicants who have attained a sufficient

skill level that will enable them to profitably

operate a farm with minimum supervision^

III. Income

The total income of the applicant at time of

application will not exceed the U.S. Bureau of

the Census, Current Population Reports, Nonmetropolitan Median Family Income for the

State.

IV . Sm all Farm Requirement.

Section 1941.4(g) of this subpart states that

a limited resource applicant may operate a

small farm. A small farm is described as a

marginal family farm. Such a farm must meet

the definitions of “family farm” and “farm”

found in § 1941.4(d) and § 1941.4(e) of this

subpart, and must have planned annual gross

farm income of at least $3,000. A marginal

family farm is usually one which is at the

very lowest acreage and income level in the

area but which still qualifies as a family farm.

* * * * *

This document has been reviewed in 

accordance with FmHA Instruction 

1901-G, "Environmental Impact 

Statements.” It is the determination of 

FmHA that this action does not 

consitute a major Federal action 

significantly affecting the quality of the 

human environment and, in accordance 

with the National Environmental Policy 

Act of 1969, P.L. 91-190, an 

Environmental Impact Statement is not 

required.

(7 U.S.C. 1989; delegation of authority by the

Secretary of Agriculture, 7 CFR 2.23;

delegation of authority by the Assistant

Secretary for Rural Development, 7 CFR 2.70)

Dated: June 6,1980.

Gordon Cavanaugh,

Adm inistrator, Farmers Home

Adm inistration.

[FR Doc. 80-19428 Filed 6-26-80; 8:45 am]

BILLING CODE 3410-07-M

FEDERAL ELECTION COMMISSION

11 CFR Parts 100,106,110,140,141,

142,143,144,145,146,9001, 9002,

9003,9004,9005,9006,9007

Public Financing of Presidential

General Election Campaigns

a g e n c y : Federal Election Commission. 

ACTION: Final Rule: Transmittal of 

Regulations to Congress.

s u m m a r y : FEC Regulations 

implementing the provisions of the 

Presidential Election Campaign Fund 

Act (26 U.S.C. 9001, et seq.) relating to 

the public financing of Presidential 

General Election Campaigns have been
43372 Federal Register / V o l 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations

revised and transmitted to Congress 

pursuant to 26 U.S.C. 9009(c). The 

regulations have been renumbered 

according to the section of the U.S. Code 

upon which each is based and are a 

substitute for regulations currently 

appearing in 11 CFR Parts 140 through 

146. Technical conforming amendments 

have also been made to 11 CFR Parts 

100,106 and 110. 

e f f e c t iv e DATE: Further action, 

including the announcement of an 

effective date, and deletion of existing 

regulations in 11 CFR Parts 140 through 

146, will be taken after these regulations 

have been reviewed by Congress in 

accordance with 26 U.S.C. 9009(c).

FOR FURTHER INFORMATION CONTACT:

Ms. Patricia Ann Fiori, Assistant 

General Counsel, 1325 K Street, N.W., 

Washington, D.C. 20463, (202) 523-4143. 

SUPPLEMENTARY INFORMATION: 26 U.S.C. 

9009(c) requires that any rule or 

regulation prescribed by the 

Commission under Chapter 95 of Title 

26, United States Code, be transmitted 

to the Speaker of the House of 

Representatives and the President of the 

Senate for legislative review prior to 

final promulgation. The following 

regulations were transmitted to 

Congress on June 13,1980.

By Notice of Proposed Rulemaking 

published on May 31,1978 (43 FR 23587), 

the Commission invited oral and written 

public comments on revisions to its 

regulations governing the public 

financing of Presidential election 

campaigns. Public hearings were held on 

June 20,1978. A second Notice of 

Proposed Rulemaking containing the 

text of proposed regulations to govern 

the public financing of Presidential 

General Election Campaigns was 

published for comment on May 15,1980 

(45 FR 32203). The following regulations 

are based on the comments received in 

response to these two NPRM’s as well 

as the experience the Commission has 

gained in administering the public 

financing provisions since 1976.

A section by section analysis of the 

new regulation is contained in the 

following Explanation and Justification.

Explanation and Justification 

PART 9001 Scope 

§ 9001.1 Scope

This subchapter is issued by the 

Federal Election Commission to govern 

the entitlement to and use of the 

Presidential Election Campaign Fund.

PART 9002 Definitions 

§ 9002.1 Authorized Committee

This definition derives from 26 U.S.C. 

9002(1). While the procedures for

authorizing a committee under this 

subchapter follow the procedures 

outlined in Title 2 regulations, the $5,000 

threshold established under Title 2 (11 

CFR 100.5(d)) does not apply. In 

addition, a candidate of a political party 

may designate the party’s national 

committee as the candidate’s authorized 

committee.

§ 9002.2 Candidate

This definition generally follows 26 

U.S.C. 9002(2) (A)'and (B) and as such 

does not incorporate the $5,000 

candidate threshold requirement found 

in 2 U.S.C. 431(2). The $5,000 threshold 

in the Title 2 definition of candidate 

does not apply to this subchapter 

because major party candidates are 

generally prohibited from receiving 

contributions (unless they choose to 

establish a legal and accounting 

compliance fund). The threshold is also 

not applicable to minor or new party 

candidates as the definition of 

candidate in Title 26 is premised on 

placing one’s name on the general 

election ballot as the candidate of that 

party and on “qualifying” for public 

funds by receiving a percentage of the 

popular vote.

§ 9002.3 Commission

This definition generally follows 26 

U.S.C. 9002(3).

§ 9002.4 Eligible Candidates

This definition follows 26 U.S.C. 

9002(4).

§ 9002.5 Fund

This definition follows 26 U.S.C. 

9002(5).

§ 9002.6• Major Party

This definition follows 26 U.S.C. 

9002(6). A provision has been added 

which includes within the definition -of 

“candidate” for the purposes of this 

section those individuals who received 

popular votes for the office of President 

in the preceding election. This provision 

was formerly included in the definition 

of “candidate” at 11 CFR 140.2(b).

§ 9002.7 Minor Party

This definition follows 26 U.S.C. 

9002(7). A provision has been added 

which includes within the definition of 

“candidate” for the purposes of this 

section those individuals who received 

popular votes for the office of President 

in the preceding election. This provision 

was formerly included in the definition 

of “candidate” at 11 CFR 140.2(b).

§ 9002.8 New Party

This definition follows 26 U.S.C. 

9002(8).

§ 9002.9 Political Committee

This definition narrows the scope of 

26 U.S.C. 9002(9), which extends to 

groups influencing state or local 

elections as well as federal elections.

This definition covers only those entities 

over which the Commission has 

jurisdiction, that is, those groups 

accepting contributions or making 

expenditures for the purpose of 

influencing federal elections. This 

definition is thus in concert with the 

definition of political committee in Title 

2 in that it reaches only groups 

influencing federal elections.

§ 9002.10 Presidential Election

This definition follows 26 U.S.C. 

9002(10).

§ 9002.11 Qualified Campaign Expense

This section explains and adds to the 

statutory definition of qualified 

campaign expense.

Subsection (a) generally follows 26 

U.S.C. 9002(11). Subsection (a)(3) 

provides that while expenses which 

constitute a violation of state of federal 

law are not qualified campaign 

expenses, such expenses do count 

against the candidate’s expenditure 

limitation. Since such expenses are 

made to further the candidate’s 

campaign, they should count against the 

expenditure limitation.

Subsections (b) (1) and (2) follow 2 

U.S.C. 441a(b)(2).

Subsection (b)(3) derives from the last 

sentence of 26 U.S.C. 9002(11). It permits 

a Presidential or Vice Presidential 

candidate to pay for expenditures which 

further the election of another individual 

to the extent that the expenditure 

furthers the Presidential or Vice 

Presidential candidate’s election.

Subsections (b) (4) and (5) specifically 

include as qualified campaign expenses 

unreimbursed travel costs paid by a 

candidate’s committee for media, Secret 

Service or similar personnel and 

payments for legal and accounting 

services provided solely to ensure 

compliance with Title 2 and Chapter 95 

of Title 26.

Subsection (c) sets forth those 

expenses which are not considered 

qualified campaign expenses. Expenses 

incurred after the expenditure report 

period are by definition not qualified.

An exception is made for “winding 

down” costs. Because these costs are 

necessary to the orderly termination of a 

campaign, they are considered qualified 

campaign expenses.

Primary campaign expenditures are 

not considered qualified campaign 

expenses. Since federal funds are 

provided under Chapter 95 for the
Federal Register / V o l 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations 43373

general election campaign, those funds 

are not to be used in connection with the 

primary election.

Civil or criminal penalties which must 

be paid pursuant to the Act or Chapter 

95 of Title 26 are not qualified campaign 

expenses. If such penalties were 

considered qualified, the result would be 

that federal funds would be used to pay 

penalties imposed for violations of the 

campaign law. Such penalties may, 

however, be paid from the legal and 

accounting compliance fund.

§ 9002.12 Expenditure Report Period

This definition follows 26 U.S.C. 

9002(12).

§ 9002.13 Contribution

While the term “contribution” is used, 

it is not defined in Title 26. Section 

9002.13 gives the term "contribution” the 

same meaning under Title 26 as it is 

given under Title 2.

§ 9002.14 Secretary

The term “Secretary” means the 

Secretary of the Treasury.

§ 9002.15 Political Party

While the term “political party” is not 

defined in Title 26, it is used throughout 

that Title. To make clear that this term 

has the same meaning as under Title 2, 

the Title 2 definition has been added 

here. Thus, this definition follows 2 

U.S.C 431(16).

PART 9003 Eligibility for Payments

1 9003.1 Candidate and Committee

Agreements

Subsection (a) generally follows 26 

U.S.C. 9003(a), and adds two 

requirements to that section: each 

candidate must agree to comply with the 

provisions of the Commission’s 

regulations implementing the 

Presidential Election Campaign Fund 

Act and must provide certain 

information regarding the depository 

account to which payments from the 

fund will be initially deposited. The 

latter requirement is included to 

facilitate prompt payment of amounts 

certified by the Commission.

Subsection (b) sets the time 

limitations within which the candidate 

agreement must be submitted to the 

Commission, but allows for some 

flexibility in this deadline with respect 

to minor and new party candidates.

Since major party candidates will be 

entitled to full funding, and are only 

eligible for federal funds if they have not 

received private contributions, no 

extension provisions have been made 

for such candidates.

§ 9003.2 Candidate Certification

In subsection (a), pursuant to 26 

U.S.C. 9003(b), each major party 

candidate is required to certify to the 

Commission that the candidate and his 

or her authorized committee (s) have not 

incurred and will not incur qualified 

campaign expenses in excess of his or 

her entitlement under 11 CFR Part 9004. 

The candidate shall also certify that no 

contribution has been or will be 

accepted, except those solicited for and 

deposited to the candidate’s legal and 

accounting fund and to the extent 

necessary to make up any deficiency in 

payments from the Fund.

Subsection (b) generally follows 26 

U.S.C. 9003(c) and provides that minor 

and new party candidates shall certify 

to the Commission that the candidate 

and his or her authorized committee(s) 

have nôt and will not incur qualified 

campaign expenses in excess of the 

major party candidate’s entitlement 

under 11 CFR Part 9004 and that no 

contributions have been or will be 

accepted, except where qualified * 

campaign expenses exceed aggregate 

payments received by the candidate.

Subsection (c) generally follows 26 

U.S.C. 9004(d). Subsections (c) (1) and

(2) incorporate former 11 CFR 141.2(c)

(1) and (3). Subsection (c)(3) defines the 

term “personal funds” as it is defined at 

11 CFR 110.10(b). Subsection (c)(4) 

follows 26 U.S.C. 9004(d). Subsection

(c)(5) clarifies that contributions by 

family members from funds over which 

the candidate, at the time he or she 

became a candidate, had no control or 

access to are subject to the $1,000 

limitation under 2 U.S.C. 441a, but do 

not coùnt against the $50,000 limitation 

under 26 U.S.C. 9004(d). Subsection

(c)(6) requires personal funds to be 

deposited in a committee account 

established to receive private 

contributions before such funds may be 

spent to further the candidate’s 

campaign. This requirement has been 

included to ensure that the disbursement 

of such funds is properly documented 

and reported.

Subsection (d) revises former 11 CFR 

141.2(d) and is consistent with the 

requirements for filing candidate 

agreements.

§ 9003.3 Allowable Contributions

Subsection (a) permits a candidate to 

establish a separate account known as a 

legal and accounting compliance fund. 

This provision has been added to follow 

past Commission practice, which 

allowed candidates receiving public 

funding to solicit private contributions 

to pay for the costs of services 

necessary to comply with the

requirements of the Act and Chapter 95 

of Title 26. The services covered parallel 

those described in 11 CFR 100.8(b)(15).

It should be noted that the 

establishment of a compliance fund is 

recommended only for candidates 

receiving full federal funding for their 

general election campaigns. Other 

candidates will be soliciting private 

contributions to pay for qualified 

campaign expenses and should therefore 

make payments for their legal and 

accounting compliance services from 

their private contribution account 

established under 11 CFR 9003.3(b). 

Payments made from a private 

contribution account for exempted legal 

and accounting services will not be 

counted against the candidate’s overall 

expenditure limits under 2 U.S.C 

441a(b) arid 11 CFR 110.8. (See 11 CFR 

100.8(b)(15).)

Subsection (a)(1) sets forth the 

requirements regarding funds deposited 

in this account.

Subsection (a)(l)(i) permits 

candidates to establish such an account 

prior to being chosen as the nominees of 

their political party. Early establishment 

of this account could be used to solicit 

contributions to defray start-up 

expenses for the candidate’s general 

election campaign under 11 CFR 9003.4.

Subsection (a)(l)(i)(A) requires that 

all solicitations for contributions to the 

separate legal and accounting 

compliance fund must clearly state that 

they will become part of this fund. This 

notification is necessary to inform 

contributors of the intended use of their 

contributions.

Subsection (a)(l)(i)(B) makes it clear 

that contributions to the legal and 

accounting compliance fund are subject 

to the limitations and prohibitions of 

Title 2.

Subsection (a)(l)(ii) permits a 

candidate to transfer to the separate 

legal and accounting compliance fund 

any amounts projected to remain in the 

candidate’s primary election account 

after all required repayments have been 

made to the U.S. Treasury under 11 CFR

9038.2. This projected balance 

essentially represents the amount of 

private contributions which are 

projected to remain in the candidate’s 

primary account after all federal 

matching funds have been extracted and 

all repayments made.

Subsection (a)(l)(iii) permits a 

candidate to deposit in the compliance 

fund contributions designated for the 

primary election but received after the 

general election expenditure report 

period has begun. These contributions 

may be so deposited only if the 

candidate’s primary campaign is 

solvent. In addition, the contributor
43374 Federal Register / Vol. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations

must be given the same notice required 

for solicitations to the compliance fund; , 

if he or she does not object, the 

contribution may then be deposited in 

the compliance account. Otherwise, the 

contribution must be refunded. All such 

contributions which are deposited in the 

compliance fund will be counted against 

the donor’s general election contribution 

limits rather than his or her primary 

limit.

Subsections (a)(2)(i) (A) through (E) 

establish the permissible uses of 

contributions to the legal and accounting 

compliance fund.

Subsection (a)(2)(i)(A) permits the use 

of such contributions to defray the costs 

of legal and accounting services 

provided solely to ensure compliance 

with the requirements of Title 2 and of 

Chapter 95 of Title 26. Legal and 

accounting services which are not 

related to compliance must be paid for 

from the account maintained for federal 

funds. As set forth in 11 CFR* 

100.8(b)(15), payments for compliancerelated services made from this fund or 

other accounts containing private 

contributions will not count against the 

candidate’s expenditure limitation under 

2 U.S.C. 441a(b). Payments made from 

the federal fund account for either 

compliance related or non-compliance 

related services will count against the 

expenditure limitation.

Subsection (a)(2)(i)(B) permits the use 

of contributions to the separate legal 

and accounting compliance fund to 

defray civil or criminal penalties 

imposed pursuant to Title 2 or Chapter 

95 of Title 26. The payment of civil or 

criminal penalties is riot considered a 

qualified campaign expense and may 

not he paid from the federal funds 

account. Therefore it is necessary that 

ah acceptable source for such penalty 

payments be provided. (See 11 CFR 

9002.11(c)(4).)

Subsection (a)(2)(i)(C) permits the use 

of contributions to the separate legal 

and accounting compliance fund to 

make repayments to the U.S. Treasury 

required under 11 CFR 9007.2.

Subsection (a)(2)(i)(D) permits the use 

of contributions to the separate legal 

and accounting compliance fund for 

soliciting additional contributions to 

that account. Solicitation costs may not 

be paid from payments received from 

the Fund.

Subsection (a)(2)(i)(E) permits 

contributions to the separate legal and 

accounting compliance fund to be 

borrowed from that fund and used to 

defray qualified campaign expenses 

incurred prior to the beginning of the 

expenditure report period or prior to the 

receipt of funds from the Presidential 

Election Campaign Fund. The use of

contributions for this purpose is 

permissible because only a temporary 

borrowing is involved; the contributions 

must be restored in accordance with 11 

CFR 9003.4. Ultimately, these 

contributions will be used only for non-. 

qualified campaign expenses.

Subsection (a)(2)(ii)(A) outlines the 

related costs which may be paid from 

this account as part of the cost of 

exempted compliance services. This 

subsection also permits committees to 

allocate a portion of their overhead 

costs to compliance-related services. If 

the amount of overhead so allocated is 

equal to or less than 10% of the cost of 

all other compliance-related services, no 

proof will be required to demonstrate 

that such costs were in fact compliancerelated. If this amount exceeds 10%, the 

entire amount claimed must be justified 

as compliance costs. This formula 

follows past Commission practice.

Subsection (a)(2)(ii)(B) allows 

committees to pay all legal and 

accounting costs from their federal 

funds account and then reimburse their 

federal account for the compliancerelated portion of such costs. This 

provision allows committees some 

flexibility in deciding what portion, if 

any, of the cost of compliance services, 

they may wish to pay from federal 

funds. However, the reimbursement 

must occur before the Commission 

makes a final repayment determination 

for that committee. Further, once funds 

have been transferred to the federal 

account for such reimbursement, they 

may not be transferred back to the 

compliance fund if it is later found that 

such reimbursement was in excess of 

the amount the committee wanted to 

reimburse.

Subsection (a)(2)(iii) provides that 

disbursements made from the separate 

legal and accounting compliance fund 

will not be subject to the expenditure 

limitations of 2 U.S.C. 441a(b) and 11 

CFR 110.8 so long as they are used for 

the purposes outlined in 11 CFR 

9003.3(a)(2)(i) (A) through (D). This 

section also makes it clear that if a 

candidate bororws from this fund, 

pursuant to 11 CFR 9003.3(a)(2)(i)(E), to 

pay qualified campaign expenses 

incurred before the beginning of the 

expenditure report period or prior to the 

receipt of payments from the Fund, such 

qualified campaign expenses will count 

against the expenditure limitations.

Subsection (a)(2)(iv) prohibits the use 

of contributions to the compliance fund 

for the payment of outstanding debts 

remaining from the candidate’s primary 

campaign. This prohibition continues 

until all obligations and repayments 

have been paid for the general election; 

at that point, such funds become excess

campaign funds and may be used for 

any purpose permitted under Title 2 or 

Part 113 of the Commission’s 

regulations.

Subsection (a)(3) establishes the 

reporting, recordkeeping and 

documentation requirements for the 

separate legal and accounting 

compliance fund.

Subsection (b) sets forth the 

guidelines for candidates who may 

accept private contributions to pay for 

qualified campaign expenses.

Subsection (b)(1) defines the 

circumstances under which major, minor 

and new party candidates may accept 

such contributions. Subsection (b)(l)(i) 

follows 2 U.S.C. 9003(b)(2); subsection

(b)(l)(ii) follows 2 U.S.C. 9003(c)(2).

Subsection (b)(2) requires that all 

contributions received under this section 

be deposited into a separate account, 

and limits their use to the payment of 

qualified campaign expenses and the 

costs of soliciting contributions to this 

account. It also establishes 

recordkeeping and reporting 

requirements for this separate account.

Inasmuch as the compliance fund 

contains private contributions, 

subsection (b)(3) permits candidates to 

make transfers to this separate account 

from the legal and accounting 

compliance fund.

Subsection (b)(4) parallels the 

exemption allowed for fundraising costs 

dining the Presidential primaries for 

candidates receiving matching funds.

See 11 CFR 10Q.8(b)(21). Candidates may 

spend, as solicitation costs, up to 20% of 

the amount they are permitted to raise 

for qualified campaign expenses without 

such costs being counted against the 

expenditure limits. Disbursements for 

such solicitation costs must, however, 

be reported and documented in the same 

manner as all other disbursements, 

whether or not they are counted against 

the expenditure limits. This fundraising 

exemption is intended to make the 

system function more equitably with 

respect to candidates Who receive only 

partial federal funding. While 

candidates receiving full federal funding 

will not incur fundraising costs, 

candidates who receive only partial 

federal funding will be forced to make 

expenditures to raise private 

contributions. Therefore, a fundraising 

exemption similar to that provided for in 

the Primary Matching Fund Act is 

incorporated into these regulations.

Subsection (b)(5) requires that all 

contributions received under this section 

must be aggregated with any 

contributions made by the same person 

to the candidate’s separate legal and 

accounting compliance fund for 

purposes of the Title 2 contribution
Federal Register / Vol. 45, No. 126 / Friday, June 27, i960 / Rules and Regulations . 43375

limitations. The prohibitions of 11 CFR 

Parts 114 and 115 shall also apply to 

contributions received under this 

section.

§ 9003.4 Expenses Incurred Before the

Beginning of the Expenditure Report

Period or Prior to Receipt o f Federal

Funds.

Subsection (a)(1) defines the qualified 

cdriîpqjgn expenses which a candidate is 

permittee.' o*mcur in connection with his 

or her general election campaign prior to 

the beginning of the expenditure report 

period as defined at 11 CFR 9002.12.

This provision is designed to permit a 

candidate to set up a basic campaign 

organization before the expenditure 

report period begins.

Subsection (a)(2) allows candidates to 

continue to use the funding sources 

permitted under this section until they 

receive federal funds.

Subsection (b) establishes the 

permissible sources from which a 

candidate may obtain funds for making 

such expenditures in connection with 

the general election. These sources are 

bank loans obtained pursuant to the 

requirements o f'll CFR 100.7(b)(ll), 

loans obtained from the candidate’s 

separate legal and accounting 

compliance fund, contributions received 

by minor or new party candidates under 

11 CFR 9003.3(b), loans obtained from 

the candidate’s primary election 

campaign, and personal funds up to the 

$50,000 limit. Major party candidates 

receiving federal funds equal to the 

expenditure limitation must repay all 

loans within 15 days after receipt of 

payment of the public funds to which 

the candidate is entitled. Expenditures 

made by a candidate in accordance with 

this section will be counted against the 

candidate’s expenditure limitation under 

11 CFR 110.8 and 2 U.S.C. 441 (a) (b).

Subsection (c) requires the 

establishment of separate accounts for 

such expenditures. It also sets forth the 

documentation and reporting 

requirements for such expenditures.-

§ 9003.5 Documentation o f

Disbursements

This section generally parallels the 

documentation requirements set forth in 

the Presidential Primary Matching Fund 

regulations and also incorporates 

current recordkeeping requirements at 2 

U.S.C. 432.

Under subsection (a), the candidate 

has the burden of proving that all 

disbursements made by the candidate, 

his or her authorized committee(s) or 

any agents of either the candidate or 

such committee(s) are qualified 

campaign expenses. The statutory 

requirement that the candidate “agree

(in writing) to obtain and furnish to the 

Commission such evidence as it may 

request of the qualified campaign 

expenses” clearly indicates that the 

candidate who accepts public funding 

has the burden of proving that all 

expenditures made on his or her behalf 

were made to defray qualified campaign 

expenses.

The candidate’s burden of proof with 

regard to qualified campaign expenses 

consists of two elements—the candidate 

must show (1) that the expenditure was 

made, and (2) that the goods or services 

purchased were in connection with the 

campaign. These two elements are 

derived from the statutory definition of 

the term qualified campaign expense— 

an expense “incurred by [a] candidate

* * * or by (the candidate’s) authorized 

committee[s] to further the election of

* * * such candidate [ ] * * *” 26 U.S.C. 

9002(11).

The first element of the candidate’s 

burden of proof—showing that the 

expenditure was made—is directed at 

proving that the expenditure was 

actually incurred. The second element of 

proof—that the goods or services 

purchased were in connection with the 

campaign—is directed at showing that 

the expenditure was made to further the 

candidate's election.

Subsections (a)(1) through (4) set forth 

the minimum documentation necessary 

to show that the expenditure was 

incurred. For disbursements in excess of 

$200, the preferred documentation is by 

receipted bill from the payee. If there is 

no receipted bill, documentation may be 

by cancelled check to the payee plus a 

bill, invoice, voucher or memorandum 

from either the payee or the candidate.

If such documentation is not available, 

the minimum documentation permissible 

is a cancelled check. Disbursements of 

$200 or less, must be documented by a 

cancelled check to the payee, unless 

such disbursements are from the petty 

cash fund. Subsection (a)(3) defines the 

term “payee” to mean the ultimate 

payee, that is the person who provides 

the goods or services to the campaign. 

Except for travel advances, a cancelled 

check to a campaign staffer who then 

pays other individuals for goods and 

services provided to the campaign 

would not be sufficient documentation.

To demonstrate that the disbursement 

was made to further the candidate’s 

campaign, the “purpose” of each 

disbursement must be documented. 

Subsection (a)(5) defines the term 

“purpose" to mean a brief statement or 

description of why the disbursement 

was made. If this statement or 

description does not suffice to show that 

the disbursement was campaign related, 

the Commission, under subsection (b),

may request that the candidate explain 

the connection between the 

disbursement and the campaign.

§ 9003.6 Books and Records

This subsection deals with the 

statutorily prescribed area of the 

candidate agreement to produce books 

and records (See 26 U.S.C. 9003(a)(2)).

§ 9003.7 A udit and Examination

This section deals with the portion of 

the candidate agreement which requires 

the candidate to submit to a postelection audit and examination. (See 26 

U.S.C. 9003(a)(3)). The additional 

requirements of this section are 

intended to facilitate this audit and 

examination.

§ 9003.8 Compliance with Law and

Regulations

Under subsection (a), the candidate 

and his or her authorized committee(s) 

must comply with the requirements of 

Title 2 and Chapter 95 of Title 26. This 

section is intended to encouraged 

prompt disclosure and adequate 

recordkeeping, and puts the candidate 

on notice of all statutory and regulatory 

provisions to which he or she is subject.

Subsection (b) requires the candidate * 

to pay any penalties included in a 

conciliation agreement or imposed by a 

court against either the candidate or his 

or her authorized committee(s). This 

section would include the situation in 

which a penalty is imposed against an 

authorized committee after it has 

disposed of its excess campaign funds.

As agreed by the candidate under 11 

CFR 9003.1, the candidate is personally 

liable for such penalties.

PART 9004—Entitlement of Eligible 

Candidates to Payments; Use of 

Payments

§ 9004.1 Major parties.

This section sets forth the amount 

which an eligible major party candidate 

is entitled to receive by statute (2 U.S.C. 

441a(b)(l)(B)).

»

§ 9004.2 Pre-election payments; minor

and new parties.

Subsection (a) sets forth the 

entitlement formula for eligible minor 

party candidates who received 5 percent 

or more, but less than 25 percent, of the 

popular vote received by all candidates 

in the prior election. It generally follows 

26 U.S.C. 9004(a)(2) and former 11 CFR 

142.2(a). Subsection (b) generally 

follows former 11 CFR 142.2(b).

§ 9004.3 Post-election payments; minor

and new parties.

Subsection (a) sets forth the 

entitlement formula for eligible minor
43376 Federal Register / Vol. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations

and new party candidates who receive 5 

percent or more of the total number of 

popular votes cast in the election. It 

generally follows 26 U.S.C. 9004(a)(3) 

and former 11 CFR 142.3(a).

Subsection (b) limits allowable 

payments from the Fund to candidates 

qualifying under 11 CFR 9004.2 to an 

amount equal to the amount by which 

such candidate’s entitlement, as 

calculated under 11 CFR 9004.3, would 

exceed his or her entitlement under 11 

CFR 9004.2. It generally follows former 

11 CFR 142.3(b).

Subsection (c) generally follows 26 

U.S.C. 9004(b) (1) and (2).

The formula used for determining the 

amount to which a minor or new party 

candidate is entitled after the election is 

demonstrated by the following example:

Assuming that the amount to which a 

major party candidate is entitled equals 

$20 million and that Candidate X, a 

minor party candidate, incurs qualified 

campaign expenses of $20 million. If 

Candidate X raises $15 million in private 

contributions and, after the election, 

Candidate X«is entitled (based on his or 

her vote percentage) to receive $10 

million in federal funds, Candidate X 

will receive only $5 million since $5 

million represents the difference 

between the amount of qualified 

campaign expenses incurred and the 

amount of contributions received ($20 

million minus $15 million). If Candidate 

X had received $2 million in federal 

funds prior to the election, he or she 

would only receive $3 million after the 

election. If, based on the vote 

percentage, Candidate X was entitled to 

receive only $3 million even though the 

total of qualified campaign expenses 

incurred which were not covered by 

private contributions equalled $5 

million, Candidate X would still only 

receive the amount to which he or she 

was entitled.

§ 9004.4 Use o f Payments

Subsection (a) generally follows 26 

U.S.C. 9004(c) and specifies the purposes 

for which eligible candidates may use 

monies received from the Fund, that is, 

to defray qualified campaign expenses. 

In addition to expenses incurred during 

the expenditure report period, payments 

may be used to defray winding down 

costs, which are considered qualified 

campaign expenses if connected with 

the termination of the candidate’s 

campaign (See A O R 1976-54), and to 

restore funds expended for qualified 

campaign expenses incurred before the 

beginning of the expenditure report 

period. Subsection (a)(4) also sets forth 

examples of those winding down costs 

which would be considered by the

Commission to be qualified campaign 

expenses.

Subsection (b) prohibits the use of 

federal funds to solicit contributions to 

the candidate’s legal and accounting 

compliance fund. Since excess funds 

from the compliance fund may be used 

after the campaign for any purpose 

permissible under 2 U.S.C. 439a, the use 

of federal funds to solicit contributions 

to that account was felt to be 

inappropriate.

§ 9004.5 Investment o f public funds.

This section concerns the investment 

of public funds. While the statute does 

not specifically provide for such activity, 

this section is consistent with the 

Commission’s past practice of permitting 

eligible candidates to invest public 

funds. An amount equal to the income 

derived, minus investment expenses or 

any taxes paid on such income, must be 

repaid to the Treasury. It should be 

noted that if, as a result of such an 

investment, there is a loss in federal 

funds, the candidate will be required to 

repay any amount lost.

§ 9004.6 Reimbursements for

transportation and services made

available ter media, Secret Service and

similar personnel.

Subsections (a) and (b) establish rules 

to govern the use of candidate supplied 

transportation and ground services by 

members of the media, Secret Service, or 

similar personnel. Candidates are not 

required to seek reimbursement for such 

transportation or ground services, but 

may consider the costs involved to be 

qualified campaign expenses subject to 

the candidate’s overall expenditure 

limitation pursuant to 2 U.S.C. 441a(b).

If, however, reimbursement is sought, 

such reimbursement may not exceed the 

amounts established in this section.

Any reimbursement sought for 

transportation made available to media, 

Secret Service or similar personnel may 

not exceed the individuals’ pro rata 

share of the actual cost of the 

transportation made available. Any 

reimbursement sought for ground 

services made available to members of 

the media, Secret Service, or similar 

personnel shall not exceed either: the 

individual’s pro rata share of the actual 

cost of the services made available; or a 

reasonable estimate of sudh cost. If 

reimbursements related to a trip exceed 

by 10% or more the actual cost of the 

services and facilities made available, 

the excessive amount shall be deemed 

income to the committee. The purpose of 

this provision is to eliminate the 

possibility for the subsidizing of a 

campaign by the media or other 

individuals through the charging of

higher than pro rata shares for the use of 

candidate-supplied transportation.

Example of Ground Cost 

Reimbursement for a Media Personnel 

on a Campaign Trip

Assume a trip from Washington to 

Chicago to Los Angeles to Washington. 

On this trip were 50 press 

representatives.

Further assume:

At Washington— before departure

Press bus to airport..............— ...?_______ $650.00

At Chicago

Press bus to and from airport........... ........... 1,100.00

Hotel accommodation........................... 4,387.00

Baggage handling............................... 843.00

Buffet.......... .............................. 787.00

At Los Angeles

Press bus to and from airport and hotel

to event site................................................ ,1,385.00

Baggage............................................................. 643.00

Hotel and food provided................... 7,459.00

Arrive at Washington

No service provided.......... .............................. 0

Trip cost for ground services....................... 17,254.00

5% for Misc. costs (typewriter rental,

phone installation)............................... 862.70

Total Costs................................,.............. $18,116.70

It is noted that though 50 press 

representatives were among the party at 

departure, three left the party at Chicago 

and two joined in Los Angeles. The pro 

rata share will be calculated on the 

basis of 52 persons. Also in both cities a 

number of press repre'sentatives did not 

take advantage of the transportation 

and accommodations provided.

The billing will be calculated as 

follows:

$18,116.70 divided by 52 persons=$348.39.

If it is determined that the total 

reimbursements for this trip exceeded 

$19,928.37, the excessive amount shall 

be deemed income to the Committee and 

repayable.

Subsection (c) outlines the reporting 

requirements pursuant to 11 CFR Part 

104 relating to expenditures and 

reimbursements for such transportation 

or ground services. The total 

expenditures for transportation and 

ground services will be reported by the 

committee. Reimbursements will also be 

reported, separately from expenditures. 

Pursuant to Part 104, the 

reimbursements will be subtracted from 

the committee’s total expenditures to 

produce the committee’s net 

expenditures. It is the net expenditures 

which will count against the candidate’s 

expenditure limit.

§ 9004.7 Allocation o f travel expenses.

This section is concerned with 

allocation of expenses incurred for 

travel relating to the campaign of a

candidate who receives funding under 

Chapter 95 of Title 26. If a trip by a 

candidate or any other individuals 

includes only campaign stops, the total 

cost of the trip is a qualified campaign
Federal Register / Vol. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations 43377

expense, payable by the committee. If a 

trip by a candidate or any other 

individual includes campaign and non 

campaign stops, the portion of the cost 

allocable to campaign activity is 

calculated on a campaign stop to 

campaign stop basis. For example, 

assume that to a candidate’s itinerary 

were Washington, D.C. to Detroit to San 

Francisco to Fort Worth and return to 

Washington, D.C. If the stops in San 

Francisco and Fort Worth were 

campaign-related while that in Detroit 

was not, the cost allocable to campaign 

activity would be determined by 

calculating what the trip would have 

cost if the candidate had travelled from 

Washington, D.C. to San Francisco, from 

San Francisco to Fort Worth, and from 

Fort Worth to Washington, D.C.

Individuals who use government 

conveyance or accommodations paid for 

by a government entity are required to 

reimburse the government entity for 

costs allocable to campaign activity. For 

example, the Department of Defense has 

developed a cost rate for use of aircraft 

owned by the federal government. If 

such aircraft were used for campaign 

related travel, the authorized committee 

would be required to reimburse the 

federal government on the basis of the 

Defense Department rate in accordance 

with the formula set forth in § 9004.7.

This requirement is necessary to prevent 

the free use of government conveyance 

or accommodations for campaign 

related activity. Such free use would 

amount to government subsidization of a 

candidate’s campaign and would totally 

defeat the purposes of the expenditure 

limitations. Similarly, if any person, 

other than a government entity incurs 

expenses for campaign related travel on 

behalf of a candidate, such expenses 

shall be qualified campaign expenses 

payable by the committee.

§ 9004.8 Withdrawal by candidate.

This section generally follows the 

statutory language in 26 U.S.C.

9003(d)(1) and (2). Subsection (b) 

additionally requires such individuals to 

submit a statement similar to that 

submitted by candidates who received 

primary matching funds. See 11 CFR 

Part 9034. Based on this statement, the 

amount, if any, of excess federal funds 

remaining in the individual’s campaign 

account is required to be repaid to the 

Treasury under subsection (c).

Subsection (d) provides for a final 

repayment to the Treasury if necessary, 

after the Commission has conducted its 

audit.

PART 9005—Certification by 

Commission

§ 9005.1 Initial certification.

This section follows 26 U.S.C. 9005(a). 

§ 9005.2 Finality o f certification.

Subsection (a) sets forth the procedure 

by which a candidate is notified of the 

Commission's initial decision on the 

amount which that candidate is entitled 

to receive from the Fund. A candidate 

who disputes the Commission’s 

determination is given an opportunity to 

present written materials which would 

support and warrant a reconsideration 

of the matter by the Commission. The 

Commission will render a final 

determination of certification upon 

review of the materials submitted and 

will nptify the candidate in writing of its 

decision and reasons in support thereof.

Subsection (b) generally follows 26 

U.S.C 9005(b).

§ 9005.3 Payments to eligible

candidates from the fund.

Subsection (a) generally follows 26 

U.S.C. 9006(b).

Subsection (b)(1) and (2) generally 

follow 26 U.S.C. 9006(c).

Subsection (c) and (d) require 

payments received from the Fund to be 

deposited to a separate account to 

facilitate accurate accounting of the use 

of public funds. Subsection (d) sets forth 

certain types of receipts by a 

candidate’s committee which represent 

returns of federal funds to the campaign. 

These funds must also be deposited in 

the candidate’s federal funds account.

PART 9006—Reports and 

Recordkeeping

§ 9006.1 Separate reports. '

This section requires separate 

reporting of expenditures made by a 

candidate’s authorized committee(s) to 

further his or her general election 

campaign. The provision is intended to 

facilitate accurate accounting of the use 

of public funds. Such authorized 

committee(s) shall comply with 

reporting requirements set forth at 11 

CFR 104.3(a) and (b), or when 

applicable, the reporting requirements 

set forth at 11 CFR 104.17. Candidates 

reporting in accordance with 11 CFR 

104.17 during the 1980 election cycle 

may, however, use the $200 itemization 

threshold instead of itemizing all 

receipts and disbursements aggregating 

in excess of $100.

The authorized committee(s) is also 

required to file separate reports to 

disclose different general election 

activities. One report must be filed to 

disclose all receipts and disbursements 

related to qualified campaign expenses.

A second report, which must be filed 

with the first one, should list all activity 

of the legal and accounting campaign 

fund.

§ 9006.2 Filing dates.

This section follows 2 U.S.C. 434(a)(3).

PART 9007—Examinations and Audits; 

Repayments

§ 9007.1 Audits, records and

in vestigations.

This section follows 26 U.S.C. 9007(a) 

and sets forth examples of what will be 

included in this audit.

§ 9007.2 Repayments.

Subsections (a)(1), (2), (3) and (4) 

follow 26 U.S.C. 9007(b)(1), (2), (3) and 

(4).

Subsection (a)(5) requires repayment 

for expenditures i^hich are not properly 

documented. (See Explanation and 

Justification of § 9003.5.)

Subsection (a)(6) requires repayment 

of any income received through 

investment of public funds, as provided 

in 11 CFR 9004.5.

Subsections (b).lc), (d), (e) and (f) set 

forth a procedure governing disputes 

over repayment determinations made by 

the Commission.

The Federal Election Campaign Act 

does not provide that Administrative 

Procedure Act (APA) requirements for 

adjudicative hearings (5 U.S.C. 554-557) 

apply to determinations by the 

Commission. While APA requirements 

for a full trial type hearing may not be 

applicable, procedural due process 

requirements mandate that, prior to 

repayment, the committee be afforded 

some type of opportunity to demonstrate 

to the Commission that repayment is not 

warranted. (See K. Davis,

Administrative Law of the Seventies,

§ 7.00-1-3 (Supp. 1977); Mathews v.

Eldridge, 424 U.S. 319 (1976).)

The procedure set forth in these 

sections fulfills due process 

requirements. It includes the following 

elements: notice of the legal and factual 

matters upon which the Commission is 

relying; an opportunity for the 

committee to present in writing evidence 

and reasons why repayment is not 

warranted; a final determination by the 

Commission on the basis of all evidence 

presented; and a statement of reasons 

underlying the Commission’s 

determination. (It should be noted even 

if the APA requirements were applicable 

to determinations by the Commission, 

the APA itself contains a significant 

exception to the requirement for a full 

trial type hearing by providing for the 

submission of evidence in written form 

under 5 U.S.C. 556(d).)
43378 Federal Register / Vol. 45, No. 126 / Friday, June 27, 1980 /. Rules and Regulations

Subsection (g) has been added to 

make it clear that the candidate may not 

retain public monies.

Subsection (h) follows 26 U.S.C. i 

9007(b)(5).

§ 9007.3 Additional audits.

This section follows 26 U.S.C. 9009(b), 

which authorizes the Commission to 

conduct examinations and audits, other 

than those required by 26 U.S.C. 9007(a), 

as it deems necessary to carry out its 

statutory responsibilities. Such audits 

may be conducted only upon an 

approval by four Commissioners in 

cases in which the Commission finds 

there is reason to believe that a 

violation of the Act or regulations has 

occurred or is about to occur. See 11 

CFR 111.10 and 2 U.S.C. 437g.

Note

Part 146 has been transfered to 11 CFR

1110.7.

J Subchapter E, Parts 9001 through 9009, 

jis added to Chapter I of 11 CFR to read 

\as follows:

'SUBCHAPTER E—PRESIDENTIAL

ELECTION CAMPAIGN FUND: GENERAL

ELECTION FINANCING

PART 9001—SCOPE

Sea

9001.1 Scope.

Authority: 26 U.S.C. 9009(b).

§9001.1 Scope

This subchapter governs entitlement 

to and use of funds certified from the 

Presidential Election Campaign Fund 

under 26 U.S.C. 9001, et. seq. The 

definitions, restrictions, liabilities and 

obligations imposed by this subchapter 

are in addition to those imposed by 

sections 431-455 of Title 2, United States 

Code, and regulations prescribed 

thereunder (11 CFR Parts 100 through 

115). Unless expressly stated to the 

contrary, this subchapter does not alter 

the effect of any definitions, restrictions, 

obligations and liabilities imposed by 

sections 431-455 of Title 2, United States 

Code, or regulations prescribed 

thereunder (11 CFR Parts 100 through 

115).

PART 9002—DEFINITIONS

Sec.

9002.1 Authorized committee.

9002.2 Candidate.

9002.3 Commission.

9002.4 Eligible candidates.

9002.5 Fund.

9002.6 Major party.

9002.7 Minor party.

9002.8 New party.

9002.9 Political committee.

9002.10 Presidential election.

9002.11 Qualified campaign expense.

9002.12 Expenditure report period.

9002.13 Contribution.

9002.14 Secretary.

9002.15 Political party.

Authority: 26 U.S.C. 9002, 9009(b):

§ 9002.1 Authorized committee.

(a) Notwithstanding the definition at 

11 CFR 100.5, “authorized committee” 

means, with respect to the candidates 

(as defined at 11 CFR 9002.2) of a 

political party for President and Vice 

President, any political committee(s) 

which are authorized in accordance 

with the procedures set forth at 11 CFR 

102.12 or 102.13 or which have not been 

disavowed pursuant to 11 CFR 

100.3(a)(3). If a party has nominated a 

Presidential and a Vice Presidential 

candidate, all political committees 

authorized by that party’s Presidential 

candidate shall also be authorized 

committees of the Vice Presidential 

candidate and all political committees 

authorized by the Vice Presidential 

candidate shall also be authorized 

committees of the Presidential 

candidate.

(b) Any withdrawal of an 

authorization shall be in writing and 

shall be addressed and filed in the same 

manner provided for at 11 CFR 102.12 or 

102.13.

(c) Any candidate nominated by a 

political party may designate the 

national committee of that political 

party as that candidate’s authorized 

committee in accordance with 11 CFR 

102.12(c).

§ 9002.2 Candidate.

(a) For the purposes of this 

subchapter, “candidate” means an 

individual who has met the conditions of 

either paragraph (a) (1) or (2) of this 

section:

(1) The individual has been nominated 

by a major party for election to the 

office of President of the United States 

or the office of Vice-President of the 

United States; or

(2) The individual has qualified or 

consented to have his or her name 

appear on the general election ballot (or 

to have the names of electors pledged to 

him or her on such ballot) as the 

candidate of a political party for 

election to either such office in 10 or 

more States. For the purposes of this 

section, “political party” shall be 

defined in accordance with 11 CFR 

9002.15.

(b) An individual who is no longer 

actively conducting campaigns in more 

than one State pursuant to 11 CFR 9004.5 

shall cease to be a candidate for the 

purpose of this subchapter.

§ 9002.3 Commission.

“Commission” means the Federal 

Election Commission, 1325 K Street,

N.W., Washington, D. C. 20463.

§ 9002.4 Eligible candidates.

"Eligible candidates” means those 

Presidential and Vice Presidential 

candidates who have satisfied all 

conditions for eligibility to receive 

payments from the Fund under 11 CFR 

Part 9003.

§9002.5 Fund.

“Fund” means the Presidential 

Election Campaign Fund established by 

26 U.S.C. 9006(a).

§ 9002.6 Major party.

“Major party” means a political party 

whose candidate for the office of 

President in the preceding Presidential 

election received, as a candidate of such 

party, 25 percent or more of the total 

number of popular votes received by all 

candidates for such office. For the 

purposes of 11 CFR 9002.6, “candidate” 

means, with respect to any preceding 

Presidential election, an individual who 

received popular votes for the office of 

President in such election.

§ 9002.7 Minor party.

“Minor party” means a political party 

whose candidate for the office of 

President in the preceding Presidential 

election received, as a candidate of such 

party, 5 percent or more, but less than 25 

percent, of the total number of popular 

votes received by all candidates for 

such office. For die purposes of 11 CFR

9002.7, “candidate” means with respect 

to any preceding Presidential election, 

an individual who received popular 

votes for the office of President in such 

election.

§ 9002.8 New party.

“New party” means a political party 

which is neither a major party nor a 

minor party. t

§ 9002.9 Political committee.

For purposes of this subchapter, 

“political committee” means any 

committee, club, association, 

organization or other group of persons 

(whether or not incorporated) which 

accepts contributions or makes 

expenditures for the purpose of 

influencing, or attempting to influence, 

the election of any candidate to the 

office of President or Vice President of 

the United States; except that for the 

purposes of 26 U.S.C. 9012(f), the term 

“political committee” shall be defined in 

accordance with 11 CFR 100.5.
Federal Register / Vol._45,No. 126 / Friday, June 27, 1980 / Rules and Regulations * 43379

§ 9002.10 Presidential election.

“Presidential election” means the 

election of Presidential and Vice 

Presidential electors.

§ 9002.11 Qualified campaign expense.

(a) “Qualified campaign expense” 

means any expense, including a 

purchase, payment, distribution, loan, 

advance, deposit, or gift of money or 

anything of value which meets each of 

the following conditions:

(1) The expense is incurred to further 

a candidate’s campaign for election to 

the office of President or Vice-President 

of the United States;

(2) The expense is incurred within the 

expenditure report period, as defined 

under 11 CFR 9002.12, or incurred before 

the beginning of such period in 

accordance with 11 CFR 9003.4 to the 

extent such expense is for property, 

services or facilities to be used during 

such period; and

(3) Neither the incurrence nor the 

payment of such expense constitutes a 

violation of any law of the United 

States, any law of the State in which 

such expense is incurred or paid, or any 

regulation prescribed under such 

Federal or State law, except that any 

State law which has been preempted by 

the Federal Election Campaign Act of 

1971, as amended, shall not be 

considered a State law for purposes of 

this subchapter. Any expense which 

constitutes such a violation shall 

nevertheless count against the 

candidate’s expenditure limitation if the 

expense meets the conditions set forth 

at 11 CFR 9002.11(a) (1) and (2).

(b) (1) An expenditure is made to 

further a Presidential or Vice 

Presidential candidate’s campaign if it is 

incurred by or on behalf of such 

candidate or his or her authorized 

committee. For purposes of 11 CFR 

9002.11(b)(1), any expense incurred by 

or on behalf of a Presidential candidate 

of a political party will also be 

considered an expense to further the 

campaign of the Vice Presidential 

candidate of that party. Any expense 

incurred by or on behalf of the Vice 

Presidential candidate will also be 

considered an expense to further the 

campaign of the Presidential candidate 

of that party.

(2) An expenditure is made on behalf 

of a candidate if it is made;

(i) By any authorized committee or 

any other agent of the candidate for the 

purpose of making an expenditure; or

(ii) By any person authorized or 

requested to make an expenditure by 

the candidate, by any authorized 

committee(s) of the candidate, or by an 

agent of the candidate or his or her 

authorized committee(s).

(3) Any expenditure incurred by a 

candidate or his or her authorized 

committee(s) to further the election of 

any other individual to a Federal, State 

or local office shall be a qualified 

campaign expense to the extent such 

expenditure is to further the candidate’s 

own campaign for election. If the 

expenditure is incurred specifically to 

further the election of such other 

individuals, it will not be considered a 

qualified campaign expense.

(4) Expenditures by a candidate’s 

authorized committee(s) pursuant to 11 

CFR 9004.6 for the travel and related 

ground service costs of media, Secret 

Service, or other staff authorized by law 

or required by national security to travel 

with a candidate shall be qualified 

campaign expenses. Any reimbursement 

for travel and related services costs 

received by a candidate’s authorized 

committee shall be subject to the 

provisions of 11 CFR 9004.6.

(5) Legal and accounting services 

which are provided solely to ensure 

compliance with 2 U.S.C. 431, et seq., or 

26 U.S.C. 9001, et seq., shall be qualified 

campaign expenses which may be paid 

from payments received from the Fund. 

If federal funds are used to pay for such 

services, the payments Count against the 

candidate’s expenditure limitation. Such 

services may also be paid for from an 

account established in accordance with 

11 CFR 9003.3 or may be provided to the 

committee in accordance with 11 CFR 

100.7(b)(14) and 100.8(b)(15). If payments 

for such services are made from an 

account established in accordance with 

11 CFR 9003.3, the payments do not 

count against the candidate’s 

expenditure limitation. The amount paid 

by the committee shall be reported in 

accordance with 11 CFR Part 9006. 

Amounts paid by the regular employer 

of the person providing such services 

pursuant to 11 CFR 100.7(b)(14) and 

100.8(b)(15) shall be reported by the 

recipient committee in accordance with 

11 CFR 104.3(h).

(c) The term “qualified campaign 

expense” does not include any amounts 

paid by a candidate or his or her 

authorized committee(s) for the 

following expenses:

(1) Expenses incurred after the 

expenditure report period are not 

qualified campaign expenses, except for 

"winding down costs” as provided 

under 11 CFR 9004.4(a)(3).

(2) Expenses incurred in connection 

with a candidate’s campaign for 

nomination by a political party to the 

office of President or Vice President of 

the United States shall not be qualified 

campaign expenses.

(3) Any civil or criminal penalties 

imposed pursuant to 2 U.S.C. 437g or 26

U.S.C. 9012 shall not be considered 

qualified campaign expenses. Such 

penalties may be paid from the 

candidate’s legal and accounting 

compliance fund under 11 CFR 9003.3(a).

§ 9002.12 Expenditure report period.

“Expenditure report period” means, 

with respect to any Presidential election, 

the period of time described in either 

paragraph (a) or (b) of this section, as 

appropriate.

(a) In the case of a major party, the 

expenditure report period begins on 

September 1 before the election or on 

the date on which the major party’s 

presidential nominee is chosen, 

whichever is earlier; and the period ends 

30 days after the Presidential election.

(b) In the case of a minor or new 

party, the .period will be the same as 

that of the major party with the shortest 

expenditure report period for that 

Presidential election as determined 

under paragraph (a) of this section.

§ 9002.13 Contribution.

“Contribution” has the same meaning 

given the term under 2 U.S.C. 431(8),

441b and 441c, and under 11 CFR 100.7, 

and 11 CFR Parts 114 and 115. ,

§9002.14 Secretary.

“Secretary” means the Secretary of 

the Treasury.

§ 9002.15 Political Party.

“Political party” means an 

association, committee, or organization 

which nominates or selects an 

individual for election to any Federal 

office, including the office of President 

or Vice President of the United States, 

whose name appears on the general 

election ballot as the candidate of such 

association, committee, or organization.

PART 9003—ELIGIBILITY FOR

PAYMENTS

Sec.

9003.1 Candidate and committee

agreements.

9003.2 Candidate certifications

9003.3 Allowable contributions.

9003.4 Expenses incurred prior to the

beginning of the expenditure report

period or prior to receipt of Federal

funds.

9003.5 Documentation of disbursements.

9003.6 Books and records.

9003.7 Audit and examination.

9003.8 Compliance with law and

regulations.

Authority: 26 U.S.C. 9003, 9009(b).

§ 9003.1 Candidate and Committee

Agreements.

(a) To become eligible to receive 

payments under 11 CFR Part 9005, the 

Presidential and Vice Presidential
43380 Federal R egister / Vol. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations

candidates of a political party shall sign 

a written agreement in which they shall:

(1) Agree that they and their 

authorized committee(s) shall obtain 

and furnish to the Commission such 

evidence of their qualified campaign 

expenses as is required under 

regulations implementing Chapter 95 of 

Title 26 United States Code;

(2) Agree that they and their 

authorized committee(s) shall keep and 

furnish to the Commission such records, 

books and other information as is 

required under regulations implementing 

Chapter 95 of Title 26;

(3) Agree that they and their 

authorized committee(s) shall comply 

with an audit and examination by the 

Commission as specified under 

regulations implementing Chapter 95 of 

Title 26, United States Code and to pay 

any amounts required to be paid under 

such regulations;

(4) Agree that they and their 

authorized committee(s) shall comply 

with all other conditions and 

requirements imposed under regulations 

implementing Chapter 95 of Title 26, 

United States Code; and

(5) Shall submit the name and mailing 

address of the person who is entitled to 

receive payments from the Fund on 

behalf of the candidate; the name and 

address of the depository designated by 

the candidate as required at 11 CFR 

9005.3; and the name under which each 

account is held at the depository at 

which the payments from the Fund are 

to be deposited.

(b) Major party candidates shall sign 

and submit such agreement to the 

Commission within 14 days after 

receiving the party’s nomination for 

election. Minor and new party 

candidates shall sign and submit such 

agreement within 14 days after such 

candidates have qualified to appear on 

the general election ballot in 10 states 

pursuant to 11 CFR 9002.2(a)(2). The 

Commission, upon written request by a 

minor or new party candidate at any 

time prior to the date of the general 

election, may extend the deadline for 

filing such letter, except that the 

deadline shall be a date prior to the day 

of the general election.

§ 9003.2 Candidate certifications.

(a) Major Parties. To be eligible to 

receive payments under 11 CFR Part 

9005, the Presidential and Vice 

Presidential candidates of a major party 

shall, under penalty of perjury, make 

certifications to the Commission as set 

forth below:

(1J Each candidate shall certify that 

the candidate and his or her authorized 

committee(s) have not incurred and will 

not incur qualified campaign expenses

in excess of the aggregate payments to 

which they will be entitled under 11 CFR 

Part 9004.

(2) Each candidate shall certify that 

no contributions have been or will be 

accepted by the candidate or his or her 

authorized committee(s); except as 

contributions specifically solicited for, 

and deposited to, the candidate’s legal 

and accounting compliance fund 

established under 11 CFR 9003.3(a); or 

except to the extent necessary to make 

up any deficiency in payments received 

from the Fund due to the application of 

11 CFR 9005.3(b).

(b) Minor and new parties. To be 

eligible to receive any payments under 

11 CFR Part 9005, the Presidential and 

Vice Presidential candidates of a minor 

or new party in a Presidential election 

shall, under penalty of perjury, make 

certifications to the Commission as set 

forth below:

(1) Each candidate shall certify that 

the candidate and his or her authorized 

committee(s) have not incurred and will 

not incur qualified campaign expenses 

in excess of the aggregate payments to 

which the eligible candidates of a major 

party are entitled under 11 CFR 9004.1.

(2) The candidate shall certify that no 

contributions have been or will be 

accepted by the candidate or his or her 

authorized committee(s) except to the 

extent that the qualified campaign 

expenses incurred exceed the aggregate 

payments received by such candidate 

from the Fund under 11 CFR 9004.2.

(c) All parties. To be eligible to 

receive any payment under 11 CFR

9004.2, the Presidential candidate of 

each major, minor, or new party shall 

certify to the Commission, under penalty 

of perjury, that such candidate will not 

knowiftgly make expenditures from his 

or her personal funds, or the personal' 

funds of his or her immediate family, in 

connection with his or her campaign for 

the office of President in excess of 

$50,000 in the aggregate.

(1) For purposes of this section, the 

term “immediate family” means a 

candidate’s spouse, and any child, 

parent, grandparent, brother, halfbrother, sister, or half-sister of the 

candidate, and the spouses of such 

persons.

(2) Expenditures from personal funds 

made under this paragraph shall not 

apply against the expenditure 

limitations.

(3) For purposes of this section, the 

terms “personal funds” and “personal 

funds of his or her immediate family” 

mean:

(i) Any funds, including funds from 

immediate family members, which meet 

either of the following conditions:

(A) Funds to which, at the time the 

candidate became a candidate, he or she 

had legal and rightful title; or

(B) Funds to which, under applicable 

State law, at the time the candidate 

became a candidate, he or she had the 

right of beneficial enjoyment and had 

either a legal right of access or control 

over; or

(ii) Salary and other earned income 

from bona fide employment; dividends 

and proceeds from the sale of the 

candidate’s stocks or other investments; 

bequests to the candidate; income from 

trusts established before candidacy; 

income from trusts established by 

bequest after candidacy of which the 

candidate is a beneficiary; gifts of a 

personal nature which had been 

customarily received prior to candidacy; 

proceeds from lotteries and similar legal 

games of chance.

(4) For purposes of this section, 

expenditures from personal funds made 

by a candidate of a major, minor or new 

party for the office of Vice President 

shall be considered to be expenditures 

made by the candidate of such party for 

the office of President.

(5) Contributions made by members of 

a candidate’s family from funds which 

do not meet the definition of personal 

funds under 11 CFR 9003.2(c)(3) shall not 

count against such candidate’s $50,000 

expenditure limitation under 11 CFR 

9003.2(c).

(6) Personal funds expended pursuant 

to this section shall be first deposited in 

an account established in accordance 

with 11 CFR 9003.3(b).

(d) Form. Major party candidates shall 

submit the certifications required under 

11 CFR 9003.2 in a letter which shall be 

signed and submitted within 14 days 

after receiving the party’s nomination 

for election. Minor and new party 

candidates shall sign and submit such 

letter within 14 days after such 

candidates have qualified to appear on 

the general election ballot in 10 or more 

States pursuant to 11 CFR 9002.2(a)(2). 

The Commission may, upon written 

application by a minor or new party 

candidate made at any time prior to the 

date of the general election, extend the 

deadline for filing such letter, except 

that the deadline shall be a date prior to 

the day of the general election.

§ 9003.3 Allowable contributions.

(a) Legal and Accounting Compliance

Fund—(1) Sources, (i) A candidate may 

accept contributions to a legal and 

accounting compliance fund, if such 

contributions are received and 

disbursed in accordance with this 

section. A legal and accounting 

compliance fund may be established by 

a candidate prior to being nominated as
Federal Register / V o l 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations 43381

the candidate of a political party for the 

office of President or Vice President of 

the United States.

(A) All solicitations for contributions 

to this fund shall clearly state that such 

contributions are being solicited for this 

fund.

(B) Contributions to this fund shall be 

subject to the limitations and 

prohibitions of 11 CFR Parts 110,114, 

and 115.

(ii) Funds remaining in the primary 

election account of a candidate, which 

funds are in excess of any amount 

required to be reimbursed to the > 

Presidential Primary Matching Payment 

Account under 11 CFR 9038.2, may be 

transferred to the legal and accounting 

compliance fund and used for any 

purpose permitted under this section.

(iii) Contributions which are made 

after the beginning of the expenditure 

report period but which are designated 

for the primary election may be 

deposited in the legal and accounting 

compliance fund: Provided, That: the 

candidate already has sufficient funds 

to pay any outstanding campaign 

obligation^ incurred during the primary 

campaign: and the candidate notifies the 

contributor that his or her contribution 

will be deposited in the compliance 

fund. If, after such notification the 

contributor objects to the fonds being so 

used, the contribution shall be returned. 

The contributions so received and 

deposited shall be subject to the 

contribution limitations applicable for 

the general election, pursuant to 11 CFR 

110.1(a)(2)(ii)(B).

(2) Uses, (i) Such contributions shall 

be used only for the following purposes:

(A) Such contributions may be used in 

accordance with 11 CFR 9003.3(a)(2)(ii) 

to defray the cost of legal and 

accounting services provided solely to 

ensure compliance with 2 U.S.C. 431, et.

seq., and 26 U.S.C. 9001, et. seq.

(B) Such contributions may be used to 

defray any civil or criminal penalties 

imposed pursuant to 2 U.S.C. 437g or 26 

U.S.C. 9012.

(C) Such contributions may be used to 

make repayments under 11 CFR 9007.2.

(D) Such contributions may be used to 

defray the cost of soliciting 

contributions to the legal and accounting 

compliance fund.

(E) Such contributions may be used to 

make a loan to an account established 

pursuant to 11 CFR 9003.4 to defray 

qualified campaign expenses incurred 

prior to the expenditure report period or 

prior to receipt of federal funds:

rovided, That the amounts so loaned 

are ^stored to the legal and accounting 

compliance fund.

(ii)(A) All legal and accounting costs 

related to compliance with Title 2 and

Chapter 95 of Title 26, United States 

Code may be paid from the compliance 

fund. Such costs may include payments 

for personnel, computer services, 

reproduction, mailing expenses, and 

independent audits conducted to assure 

compliance with Title 2 or Chapter 95 of 

Title 26, United States Code. A 

committee may pay from its compliance 

fund costs incurred for establishing that 

portion ef its financial accounting 

system which is allocable to the legal 

and accounting aspects of compliance. 

In addition, a committee may pay from 

its compliance fund an amount equal to 

10% of all other legal and accounting

compliance costs to cover overhead 

costs allocable to such compliance 

services. If the amount of overhead so 

allocated exceeds 10% of all other legal 

and accounting compliance costs, the 

committee shall provide proof to the 

Commission that the entire amount so 

allocated represents overhead costs 

related to legal and accounting 

compliance services.

(B) Reimbursement from the 

compliance fund may be made to the 

separate account maintained for federal 

funds under 11 CFR 9005.3(c) if costs for 

legal and accounting compliance 

services are initally paid from such 

account. Such reimbursement must be 

made prior to any final repayment 

determination by the Commission 

pursuant to 11 CFR 9007.2. Any amounts 

so reimbursed to the federal fund 

account may not subsequently be 

transferred back to the legal and 

accounting compliance fund.

(C) Payments may not be made under 

11 CFR 9003.3(a)(2)(i) for any legal and 

accounting services or related costs 

which are not performed solely to 

ensure compliance with 2 U.S.C. 431 et

seq. and26 U.S.C. 9001 etseq.

(iii) Amounts paid from this account 

for the purposes permitted by 11 CFR 

9003.3(a)(2)(i) (A) through (D) shall not 

be subject to the expenditure limits of 2 

U.S.C. 441a(b) and 11 CFR 110.8. (See 

also 11 CFR 100.8(b)(15).) When the 

proceeds of loans made in accordance 

with 11 CFR 9003.3(a)(2)(i)(E) are 

expended on qualified cam paign

expenses, such expenditures shall count 

against the candidate’s expenditure 

limit

(iv) Contributions to or funds 

deposited in the legal and a cco unting

compliance fund may not be used to 

retire debts remaining from the 

Presidential primaries except that if 

after payment of all expenses relating to 

the general election, there are excess 

campaign funds, such funds may be 

used for any purpose permitted under 2 

U.S.C. 439a and 11 CFR Part 113,

including payment of primary election 

debts.

(3) Deposit and disclosure, (i) 

Amounts received pursuant to 11 CFR 

9003.3(a)(1) shall be deposited and 

maintained in an account separate from 

that described in 11 CFR 9005.3 and 

shall not be commingled with any 

money paid to the candidate by the 

Secretary pursuant to 11 CFR 9005.3.

(ii) The receipts to and disbursements 

from this account shall be reported in a 

separate report in accordance with 11 

CFR 9006.1(b)(2). All contributions made 

to this account shall be recorded in 

accordance with 11 CFR 102.9. 

Disbursements made from this account 

shall be documented in the same 

manner provided in 11 CFR 9003.5.

(b) Contributions to Defray Qualified

Campaign Expenses. (1) A candidate or 

his or her authorized committee(s) may 

solicit contributions to defray qualified 

campaign expenses under the following 

circumstances:

(1) In the case of a major party 

candidate, to make up any deficiency in 

payments received from the Fund due to 

the application of 11 CFR 9005.3(b).

(ii) In the case of a minor or new party 

candidate, to defray qualified campaign 

expenses which exceed the amount 

received by such candidate from the 

fund, subject to the limits of 11 CFR 

9003.2(b).

(2) Such contributions shall be 

deposited in a separate account 

Disbursements from this account shall 

be made only to defray qualified 

campaign expenses and to defray the 

cost of soliciting contributions to such 

account. All disbursements from this 

account shall be documented in 

accordance with 11 CFR 9003.5 and 

reported in accordance with 11 CFR

9006.1.

(3) A candidate may make transfers to 

this account from his or her legal and 

accounting compliance fund.

(4) Any costs incurred for soliciting 

contributions to this account shall not 

be considered expenditures, to the 

extent that the aggregate of such costs 

does not exceed 20 percent of the 

amount which a candidate is permitted 

to raise in private contributions under 11 

CFR 9003.3(b). These costs shall, 

however, be reported as disbursements 

in accordance with 11 CFR Part 104 and 

11 CFR 9006.1.

(5) The contributions received under 

this section shall be subject to the 

limitations and prohibitions of 11 CFR 

Parts 110,114 and 115 and shall be 

aggregated with all contributions made 

by the same person to the candidate’s 

legal and accounting compliance fund 

under lT CFR 9003.3(a) for the purposes 

of such limitations.
43382 Federal Register / Vol. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations

§ 9003.4 Expenses incurred prior to the

beginning of the expenditure report period

or prior to receipt of Federal funds.

(a) Permissible Expenses. (1) A 

candidate may incur expenses before 

the beginning of the expenditure report 

period, as defined at 11 CFR 9002.12, if 

such expenses are for property, services 

or facilities which are to be used in 

connection with his or her general 

election campaign and which are for use 

during the expenditure report period. 

Such expenses will be considered 

qualified campaign expenses. Examples 

of such expenses include but are not 

limited to: expenses for establishing 

financial accounting systems; expenses 

for organizational planning; and 

expenses for polling.

(2.) A candidate may incur qualified 

campaign expenses prior to receiving 

payments under 11 CFR Part 9005.

(b) Sources. (1) A candidate may 

obtain a loan which meets the 

requirements of 11 CFR 100.7(b)(ll) for 

loans in the ordinary course of business 

to defray permissible expenses 

described in paragraph (a) of this 

section. Candidates receiving payments 

equal to the expenditure limitation in 11 

CFR 110.8 shall make full repayment of 

principal and interest on such loans 

from payments received by the 

candidate under 11 CFR Part 9005 within 

15 days of receiving such payments.

(2) A candidate may borrow from his 

or her legal and accounting compliance 

fund for the purpose of defraying 

permissible expenses described in 

paragraph (a) of this section. All 

amounts borrowed from the legal and 

accounting compliance fund must be 

restored to such fund after the beginning 

of the expenditure report period either 

from federal funds received under 11 

CFR Part 9005 or private contributions 

received under 11 CFR 9003.3(b). For 

candidates receiving federal fimds, 

restoration shall be made within 15 days 

after receipt of such funds.

(3) A minor or new party candidate 

may defray such expenses from 

contributions received in accordance 

with 11 CFR 9003.3(b).

(4) (i) A candidate who has received 

federal funding under 11 CFR Part 9031, 

et seq., may borrow from his or her 

primary election campaign an amount 

not to exceed the residual balance 

projected to remain in the candidate’s 

primary account(s) on the basis of the 

formula set forth at 11 CFR 9038.3(c). A 

major party candidate receiving 

payments equal to the expenditure 

limitation shall reimburse amounts 

borrowed from his or her primary 

campaign from payments received by 

the candidate under 11 CFR Part 9005 

within 15 days of such receipt.

(ii) A candidate who has not received 

federal funding during the primary 

campaign may borrow at any time from 

his or her primary account(s) to defray 

such expenses, provided that a major 

party candidate receiving payments 

equal to the expenditure limitation shall 

reimburse all amounts borrowed from 

his or her primary campaign from 

payments received by the candidate 

under 11 CFR Part 9005 within 15 days 

of such receipt.

(5) A candidate may use personal 

funds in accordance with 11 CFR 

9003.2(c), up to his or her $50,000 limit, to 

defray such expenses.

(c) Deposit and Disclosure. Amounts 

received or borrowed by a candidate 

under 11 CFR 9003.4(b) to defray 

expenses permitted under 11 CFR 

9003.4(a) shall be deposited in a 

separate account used only for such 

expenses. All receipts and 

disbursements from such account shall 

be reported pursuant to 11 CFR 9006.1(a) 

and documented in accordance with 11 

CFR 9003.5.

§ 9003.5 Documentation of

disbursements.

(a) Each candidate has the burden of 

proving that disbursements made by the 

candidate or any authorized 

committee(s) are qualified campaign 

expenses. The candidate and his or her 

authorized committees shall obtain and 

furnish to the Commission at its request 

any evidence regarding qualified 

campaign expenses made by the 

candidate, all authorized committees 

and all agents thereof. The candidate 

shall include, as part of this evidence, 

the full name and mailing address of the 

payee; the date and amount of the 

disbursement; and the following 

documentation:

(1) For each disbursement exceeding 

$200, either:

(i) A receipted bill from the payee 

which describes the purpose of the 

disbursement; or

(ii) If such a receipted bill is not 

available, the following documents, 

which shall describe the purpose of the 

disbursement:

(A) A cancelled check negotiated by 

the payee; plus

(B) Either a bill, invoice, voucher, or 

contemporaneous memorandum from 

the payee.

(C) Where the documents specified at 

11 CFR 9003.5(a)(l)(ii)(B) are not 

available, a voucher or 

contemporaneous memorandum from 

the candidate or the committee shall be 

provided.

(iii) If neither a receipted bill nor the 

documentation specified in 11 CFR 

9003.5(a)(l)(ii) is available, the

candidate or committee may present a 

cancelled check and collateral evidence 

to document the purpose of each 

qualified campaign expense. Such 

collateral evidence may include but is 

not limited to:

(A) Evidence demonstrating that the 

disbursement is part of an identifiable 

program or project which is otherwise 

sufficiently documented, such as a 

disbursement which is one of a number 

of documented disbursements relating to 

a campaign mailing or to the operation 

of a campaign office;

(B) Evidence that the disbursement is 

covered by a pre-established written 

campaign committee policy, such as a 

per diem policy.

(2) For all other disbursements, the 

candidate or committee shall provide 

the following documentation:

(i) If the disbursement is made from 

the petty cash fund pursuant to 11 CFR 

102.11, a record disclosing the full name 

and mailing address of the payee and 

the amount and date of the 

disbursement shall be kept.

(ii) In all other cases, a cancelled 

check which has been negotiated by the 

payee and states the full name and 

mailing address of the payee arid the 

date and amount of the disbursement 

shall be provided.

(3) For purposes of 11 CFR 9003.5(a)

(1) and (2), “payee”, means the person 

who provides the goods or services to 

the candidate or authorized committee 

or agent thereof in return for the 

disbursement, except in the case of an 

advance of $500 or less for travel and/or 

subsistence paid to an individual who 

will be the recipient of the goods or 

services purchased. For any advance of 

$500 or less paid to an individual for 

travel and/or subsistence, the expense 

voucher or other expense account 

documentation and a cancelled check 

made to the recipient of thfe advance 

shall be retained for documentation.

(4) For purposes of 11 CFR 9003.5(a)

(1) and (2), the requirement to retain a 

cancelled check shall be satisfied with 

respect to disbursements made using 

credit cards when all of the following 

documentation is retained: The monthly 

billing statement, the customer receipt 

for each transaction, and the cancelled 

check used to pay the credit card 

account.

(5) For purposes of this section, 

“purpose" shall have the same meaning 

as set forth in 11 CFR 104.3(b) (4) (i)(A).

(b) Upon the request of the 

Commission, the candidate shall supply 

an explanation of the connection 

between the disbursement and the 

campaign.
Federal Register / Vol. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations 43383

§ 9003.6 Books and records.

The candidate shall furnish to the 

Commission upon its request books and 

records of all accounts, including bank 

records and any other information and 

documentation, maintained by any 

authorized committee!s) or by agents of 

the candidate or such committees.

§ 9003.7 Audit and examination.

The candidate shall permit an audit 

and examination pursuant to 1 1 CFR

9007.1 of all campaign receipts, 

disbursements, debts and obligations of 

the candidate, any authorized 

committee(s) or agents of the candidate 

or his or her committees. The candidate 

shall gather the documentation, books 

and records specified in 11 CFR 9003.5 

and 9003.6 in one centralized location 

for such audit; and shall facilitate such 

audit by making available office space, 

and such personnel as is necessary to 

the conduct of the audit and 

examination. The candidate shall pay 

any amounts required to be paid under 

11 CFR 9007.2.

§ 9003.8 Compliance with law and

regulations.

(a) The candidate and his or her 

authorized committee(s) shall comply 

with the applicable requirements of the 

Act, as well as Chapter 95 of Title 26, 

United States Code and Regulations 

prescribed under such Act and Chapter.

(b) The candidate shall pay any 

penalties included in a conciliation 

agreement with or imposed under 2 

U.S.C. 437g and 26 U.S.C. 9012 against 

the candidate or any authorized 

committee of the candidate. (See 11 CFR 

9003.3(a)).

PART 9004—ENTITLEMENT OF

ELIGIBLE CANDIDATES TO

PAYMENTS; USE OF PAYMENTS

Sea

9004.1 Major Parties.

9004.2 Pre-election payments; minor and

new parties.

9004.3 Post-election payments; minor and

new parties.

9004.4 Use of payments.

9004.5 Investment of public funds.

9004.6 Reimbursements for transportation

and services made available to media.

Secret Service, and similar personnel

9004.7 Allocation of travel expenses.

9004.8 Withdrawal of candidate.

Authority: 26 U.S.C. 9004, 9009(b).

8 9004.1 Major parties.

The eligible candidates of each major 

Party in a Presidential election shall be 

entitled to equal payments under 11 CFR 

Part 9005 in an amount which, in the 

aggregate, shall not exceed $20,000,000 

88 adjusted by the Consumer Price

Index in the manner described in 11 CFR 

110.9(c).

§ 9004.2 Pre-election payments; minor

and new parties.

(a) The eligible candidates of a minor 

party shall be entitled to payments 

under 11 CFR Part 9005, which payments 

are equal, in the aggregate, to a 

proportionate share of the amount to 

which major party candidates are 

entitled under 11 CFR 9004.1. The 

aggregate amount received by a minor 

party candidate shall bear the same 

ratio to the amount received by the 

major party candidates as the number of 

popular votes received by the minor 

party Presidential candidate in the 

preceding Presidential election bears to 

the average number of popular votes 

received by all major party candidates 

in that election.

(b) If the candidate of one or more 

political parties (not including a major 

party) for the office of President was a 

candidate for such office in the 

preceding Presidential election and 

received at least 5 percent but less than 

25 percent of the total number of popular 

votes received by all candidates for 

such office, such candidate and his 

running mate for the office of Vice 

President shall be treated as eligible 

candidates entitled to payments under 

11 CFR 9005.1, upon compliance with the 

provisions of 11 CFR 9003.1 and 9003.2. 

The amount of such payments shall be 

computed as provided in 11 CFR 

9004.2(a) based on the number of 

popular votes received by such 

candidate for the office of President in 

the preceding Presidential election. If 

eligible candidates of a minor party are 

entitled to payments under this 

paragraph, such entitlement shall be 

reduced by the amount of the 

entitlement allowed under 11 CFR 

9004.2(a).

§ 9004.3 Post-election payments; minor

and new parties.

(a) Eligible candidates of a minor 

party or of a new party who, as 

candidates, receive 5 percent or more of 

the total number of popular votes cast 

for the office of President in the election 

shall be entitled to payments under 11 

CFR Part 9005 equal, in the aggregate, to 

a proportionate share of the amount 

allowed for major party candidates 

under 11 CFR 9004.1. The amount to 

which a minor or new party candidate is 

entitled shall bear the same ratio to the 

amount received by the major party 

candidates as the number of popular 

votes received by such candidate in 

such election bears to the average 

number of popular votes received in

such election by the major parties’ 

candidates for President. - >

(b) In the case of eligible candidates 

entitled to payments under 11 CFR

9004.2, the amount allowable under this 

paragraph shall be limited to the 

amount, if any, by which the entitlement 

under 11 CFR 9004.3(a) exceeds the 

amount of the entitlement under 11 CFR

9004.2.

(c) The aggregate payments to which 

the eligible candidates of a minor or 

new political party shall be entitled 

shall not exceed an amount equal to the 

lower of:

(1) The amount of qualified campaign 

expenses incurred by such eligible 

candidates and their authorized 

committees, reduced by the amount of 

contributions which are received to 

defray qualified campaign expenses by 

such eligible candidates and such 

committees; or

(2) The aggregate payments to which . 

the eligible candidates of a major party 

are entitled under 11 CFR 9004.1, 

reduced by the amount of contributions 

received by such eligible candidates and 

their committees to defray qualified 

campaign expenses in the case of a 

deficiency in the Fund.

§ 9004.4 Use of payments.

(a) An eligible candidate of a political 

party shall use payments received under 

11 CFR Part 9005 only for the following 

purposes:

(1) A candidate may use such 

payments to defray qualified campaign 

expenses incurred by such eligible 

candidates or their authorized 

committees.

(2) A candidate may use such 

payments to repay bank loans or 

otherwise restore funds (other than 

contributions received pursuant to 11 

CFR 9003.3(b) and expended to defray 

qualified campaign expenses) used to 

defray qualified campaign expenses.

(3) A candidate may use such 

payments to restore funds expended in 

accordance with 11 CFR 9003.4 for 

qualified campaign expenses incurred 

by the candidate prior to the beginning 

of the expenditure report period.

(4) A candidate may use such 

payments to defray winding down costs 

incurred after the close of the 

expenditure report period: Provided,

That such costs are associated with the 

termination of that candidate’s general 

election campaign. Examples of such 

costs include but are not limited to: The 

cost of complying with the post-election 

requirements of the Act, the cost of 

necessary office space rental, and 

payroll costs for necessary personnel.

(b) A candidate shall not use 

payments received under 11 CFR Part
43384 Federal Register / V ol. 45, No. 126 / Friday, Jime 27, 1980 / Rules and Regulations

9005 to solicit contributions to a legal 

and accounting compliance fund 

established pursuant to 1 1 CFR 

9003.3(a).

§ 9004.5 Investment o f public funds.

Investment of public funds or any 

other use of public funds to generate 

income is permissible, provided that an 

amount equal to all net income derived 

from such investments, less Federal, 

State and local taxes paid on such 

income, shall be repaid to the Secretary.

§ 9004.6 Reimbursements for

transportation and services made available

to media, Secret Service and similar

personnel.

(a) If an authorized committee incurs 

expenses for transportation made 

available to media, Secret Service or 

other staff authorized by law or required 

by national security to travel with a 

candidate, such expenses shall be 

qualified campaign expenses. If 

reimbursement for such expenses is 

received by a committee, the amount of 

such reimbursement for each individual 

shall not exceed that individual’s pro 

rata share of the actual cost of the 

transportation made available. An 

individual's pro rata share shall be 

calculated by dividing the total number 

of passengers transported into the total 

cost of the transportation made 

available.

(b) If an authorized committee incurs 

expenses for ground services and 

facilities (e.g. ground transportation, 

housing, meals, telephone service, 

typewriters) made available to media, 

Secret Service, or other staff authorized 

by law or required by national security 

to travel with a candidate, such 

expenses shall be qualified campaign 

expenses. If reimbursement for such 

expenses is received by a committee, 

the amount of such reimbursement for 

each individual shall not exceed either: 

the individual’s pro rata share of the 

actual cost of the services and facilities 

made available; or a reasonable 

estimate of the individual’s pro rata 

share of the actual cost of the services 

and facilities made available. If it is 

determined that reimbursements related 

to a trip have exceeded by 10% or more 

the actual cost of the services and 

facilities made available, such excessive 

amount shall be deemed income to the 

committee and shall be repaid to the 

Secretary. An individual’s pro rata share 

shall be calculated by dividing the total 

number of individuals to whom such 

services and facilities are made 

available into the total cost of such 

services and facilities.

(c) The total amount paid by an 

authorized committee for the cost of

transportation or for ground services 

and facilities shall be reported as an 

expenditure in accordance with 11 CFR 

104.3(b)(2)(i). Any reimbursement 

received by such committee for 

transportation or ground services and 

facilities shall be reported in accordance 

with 11 CFR 104.3(a)(3)(ix).

§ 9004.7 Allocation of travel expenses.

(a) Notwithstanding the provisions of 

11 CFR Part 106, expenses for travel 

relating to a Presidential or Vice 

Presidential candidate’s campaign by 

any individual, including a candidate, 

shall, pursuant to the provisions of 

paragraph (b) of this section, be 

qualified campaign expenses and be 

reported by the candidate’s authorized 

committee(s) as expenditures.

(b) (1) For a trip which is entirely 

campaign related, the total cost of the 

trip shall be a qualified campaign 

expense and a reportable expenditure.

(2) For a trip which includes campaign 

related and non-campaign related stops, 

that portion of the cost of the trip 

allocable to campaign activity shall be a 

qualified campaign expense and a 

reportable expenditure. Such portion 

shall be determined by calculating what 

the trip would have cost from the point 

of origin of the trip to the first campaign 

related stop and from that stop through 

each subsequent campaign related stop 

to the point of origin. If any campaign 

activity, other than incidental contacts, 

is conducted at a stop, that stop shall be 

considered campaign related.

(3) For each trip, an itinerary shall be 

prepared and such itinerary shall be 

made available for Commission 

inspection.

(4) For trips by government 

conveyance or by charter, a list of all 

passengers on such trip, along with a 

designation of which passengers are and 

which are not campaign related, shall be 

made available for Commission 

inspection.

(5) If any individual, including a 

candidate, uses government conveyance 

or accommodations paid for by a 

government entity for campaign related 

travel, the candidate’s authorized 

committee shall pay the appropriate 

government entity an amount equal to 

that portion of the actual cost of the 

conveyance or accommodations which 

is allocable to all passengers, including 

the candidate, travelling for campaign 

purposes. Such payments to the 

government entity shall be considered 

qualified campaign expenses and shall 

be reported by the committee as 

expenditures.

(i) If the trip is by government 

conveyance or charter paid for by a 

government entity, the actual cost for

each passenger shall be determined by 

dividing the total operating cost for the 

conveyance or charter by the total 

number of passengers transported. The 

amount payable to the government 

entity shall be calculated in accordance 

with the formula set forth at I t CFR 

9004.7(b)(2) on the basis of the actual 

cost per passenger multiplied by the 

number of passengers travelling for 

campaign purposes.

(ii) If the trip is by non-charter 

commercial transportation or 

accommodations paid for by a 

government entity, the actual cost shall 

be calculated in accordance with the 

formula set forth at 11 CFR 9004.7(b)(2) 

on the basis of commercial fare.

(iii) In the case of candidates 

authorized by law or required by 

national security, to be accompanied by 

staff, such staff shall not be considered 

to be travelling for campaign purposes 

unless such staff engages in campaign 

activity during a trip.

(iv) Travel expenses of a candidate’s 

spouse and family when accompanying 

the candidate on campaign travel may 

be treated as qualified campaign 

expenses and reportable expenditures. If 

the spouse or family members conduct 

campaign related activities, their travel 

expenses shall be qualified campaign 

expenses and reportable expenditures.

(6) If any individual, including a 

candidate, incurs expenses for campaign 

related travel, other than by use of 

government conveyance or 

accommodations, an amount equal to 

that portion of the actual cost of the 

conveyance or accommodations which 

is allocable to all passengers, including 

the candidate, travelling for campaign 

purposes shall be a qualified campaign 

expense and shall be reported by the 

committee as an expenditure.

(i) If the trip is by charter, the actual 

cost for each passenger shall be 

determined by dividing the total 

operating cost for the charter by the 

total number of passengers transported. 

The amount which is a qualified 

campaign expense and a reportable 

expenditure shall be calculated in 

accordance with the formula set forth as 

11 CFR 9004.7(b)(2) on the basis of the 

actual cost per passenger multiplied by 

the number of passengers travelling for 

campaign purposes.

(ii) If the trip is by non-charter 

commercial transportation the actual 

cost shall be calculated in accordance 

with the formula set forth at 11 CFR 

9004.7(b)(2) on the basis of commercial 

fare. Such actual cost shall be a 

qualified campaign expense and a 

reportable expenditure.
Federal R egister / Vol. 45, No, 126 / Friday, June 27, 1980 / Rules and Regulations 43385

(iii) The provisions of 11 CFR 

9004.7(b)(5) (iii) and (iv) apply to 

calculations under this section.

§ 9004.8 Withdrawal by Candidate.

(a) Any individual who is not actively 

conducting campaigns in more than one 

State for the office of President or Vice 

President shall cease to be a candidate 

under 11 CFR 9002.2.

(b) An individual who ceases to be a 

candidate under this section shall:

(1) No longer be eligible to receive any 

payments under 11 CFR 9005.3, except to 

defray qualified campaign expenses as 

provided at 11 CFR 9004.4.

(2) Submit a statement, within 60 days 

after he or she ceases to be a candidate, 

setting forth the following information:

(i) The total of all outstanding 

obligations for qualified campaign 

expenses as of die date on which the 

individual ceased to be a candidate plus 

an estimate of any necessary winding 

down costs as provided under 11 CFR 

9004.4(a)(4), and

(ii) The total of: All cash on hand as of 

the close of business on the day on 

which the individual ceases to be a 

candidate under this section; the fair 

market value of capital assets on hand; 

and all amounts owed to the campaign 

in the form of credits, returns, 

receivables or rebates of qualified 

campaign expenses (or a commercially 

reasonable amount based on the 

collectibility of those credits, returns, 

receivable or rebates). For purposes of 

this section, a capital asset means any 

property which has remaining useful life 

exceeding 1 year from the date on which 

the individual ceased to be a candidate, 

provided that the fair market value on 

such date exceeds $500.

(c) If the total of the amounts set forth 

in 11 CFR 9004.5(b)(ii) exceeds the total 

set forth in 11 CFR 9004.5 (b)(i), the 

individual shall pay to the Secretary, 

within 60 days after the date on which 

he or she ceased to be a candidate, an 

amount equal to the difference between 

such totals; except that if the total 

payments received by the individual 

from the Fund equal an amount which is 

less than such difference, the individual 

shall repay an amount equal to the total 

Payments received by the individual 

from ther Fund.

(d) A final repayment shall be made, if 

necessary, pursuant to 11 CFR 9007.2, 

after an audit has been conducted by 

the Commission under 11 CFR 9007.1.

PART 9005—CERTIFICATION BY

COMMISSION

Sec.

®005.1 Intitial Certification.

9005.2 Finality of Certification;

9005.3 Payments to Eligible Candidates from

the Fund.

Authority: 26 U.S.C. 9005, 9009(b).

§ 9005.1 Initial certification.

Not later than 10 days after the 

Presidential and Vice Presidential 

candidates of a political party have met 

all applicable conditions for eligibility to 

receive payments under 11 CFR 9003.1 

and 9003.2, the Commission shall certify 

to the Secretary that payment in full of 

the amounts to which such candidates 

are entitled under 11 CFR Part 9004 

should be made pursuant to 11 CFR

9005.3.

§ 9005.2 Finality of certification.

(a) (1) Except for major party 

candidates who are certified to receive 

an amount equal to the expenditure 

limitation, the Commission shall notify 

all candidates of its initial determination 

of the amount, if any, to which such 

candidates are entitled, give the legal 

and factual reasons for its 

determination, and advise the 

candidates of the evidence upon which 

such determination is based. The 

candidate will be given an opportunity 

to submit, within 15 days of the initial 

determination, written legal and/or 

factual material to demonstrate that a 

redetermination is appropriate.

(2) The Commission shall consider 

any written legal or factual materials 

submitted by the candidate in making its 

final determination. Such materials may 

be submitted by counsel if the candidate 

so desires.

(3) A final determination of 

certification by the Cbmmission shall be 

accompanied by a written statement of 

reasons for the Commission^ action.

This statement shall explain the reasons 

underlying the Commission’s 

determination and shall summarize the 

results of any investigation upon which 

the determination is based.

(b) Certifications by the Commission 

under 11 CFR 9005.1, and all 

determinations made by it under this 

subchapter, shall be final and 

conclusive, except to the extent that 

they are subject to examination and 

audit by the Commission under 11 CFR 

Part 9007 and judicial review under 26 

U.S.C 9011.

§ 9005.3 Payments to eligible candidates

from the fund.

(a) Upon receipt of a certification from 

the Commission under 11 CFR 9005.1 for 

payment to the eligible Presidential and 

Vice Presidential candidates of a 

political party, the Secrertary shall pay 

to such candidates out of the Fund the 

amount certified by the Commission.

Amounts paid to a candidate shall be 

under the control of that candidate.

(b) (1) If at the time of a certification 

from the Commission under 11 CFR

9005.1, the Secretary or his or her 

delegate determines that the moneys in 

the Fund are not, or may not be, 

sufficient to satisfy the full entitlements 

of the eligible candidates of all political 

parties, he or she shall withhold an 

amount which is determined to be 

necessary to assure that the eligible 

candidates of each political party will 

receive their pro rata share.

(2) Amounts withheld under this 

paragraph shall be paid when the 

Secretary or his or her delegate 

determines that there are sufficient 

moneys in the Fund to pay such 

amounts, or pro rata portions thereof, to 

all eligible candidates from whom 

amounts have been withheld.

(c) Payments received from the Fund 

by a candidate shall be deposited in a 

separate account maintained by his or 

her authorized committee. This account 

shall be maintained at a State bank, 

federally chartered depository 

institution or other depository 

institution, the deposits or accounts of 

which are insured by the Federal 

Deposit Insurance Corporation or the 

Federal Savings and Loan Insurance 

Corporation.

(d) No funds other than the payments 

received from the Treasury, 

reimbursements, or income generated 

through use of public funds in 

accordance with 11 CFR 9004.5, shall be 

deposited in the account described in 11 

CFR 9005.3(c). "Reimbursements” shall 

include but are not limited to refunds of 

deposits, vendor refunds, 

reimbursements for travel expenses 

under 11 CFR 9004.6 and 9004.7, and 

reimbursements for legal and accounting 

costs under 11 CFR 9003.3(a)(2)(ii)(B).

PART 9006—REPORTS AND

RECORDKEEPING

Sec.

9006.1 Separate Reports.

9006.2 Filing Dates.

Authority: 26 U.S.C. 9006, 9009(b).

§ 9006.1 Separate reports.

(a) The authorized committee(s) of a 

candidate shall report all expenditures 

to further his or her general election 

campaign in reports separate from 

reports of any other expenditures made 

by such committee(s) with respect to 

other elections. Such reports shall be 

filed pursuant to the requirements of 11 

CFR Part 104. The authorized 

committee(s) of candidates seeking 

election prior to January 1,1981 may 

elect to comply with the requirements of
43386 Federal Register / Voi.. 45, No. 126 / Friday, June 27, 1980 / Rules and Regulations

11 CFR 104.17 in lieu of 11 CFR 104.3(a) 

and (b).

(b) The authorized committee(s) of a 

candidate shall file separate reports as 

follows:

(1) One report shall be filed which 

lists all receipts and disbursements of:

(1) Contributions and loans received 

by a major party candidate pursuant to 

11 CFR Part 9003 to make up 

deficiencies in Fund payments due to 

the application of 11 CFR Part 9005;

(ii) Contributions and loans received 

pursuant to 11 CFR 9003.2(b)(2) by a 

minor or new party candidate for use in 

the general election;

(iii) Receipts for expenses incurred 

before the beginning of the expenditure 

report period pursuant to 11 CFR 9003.4;

(iv) Personal funds expended in 

accordance with 11 CFR 9003.2(c); and

(v) Payments received from the Fund.

(2) A second report shall be filed 

which lists all receipts of, and 

disbursements from, contributions 

received for the candidate’s legal and 

accounting compliance fund in 

accordance with 11 CFR 9003.3(a).

§ 9006.2 Fifing dates.

The reports required to be filed under 

11 CFR 9006.1 shall be filed during an 

election year on a monthly or quarterly 

basis as prescribed at 11 CFR 

104.5(b)(1). During a non-election year, 

the candidate’s principal campaign 

committee may elect to file reports 

either on a monthly or quarterly basis in 

accordance with 11 CFR 104.5(b)(2).

PART 9007—EXAMINATIONS AND

AUDITS; REPAYMENTS

Sec.

9007.1 Audits, Records and Investigations.

9007.2 Repayments.

9007.3 Additional audits.

Authority: 26 U.S.C. 9007, 9009(b)

§ 9007.1 Audits, records and

investigations.

After each Presidential election, the 

Commission shall conduct a thorough 

examination and audit of the receipts, 

disbursements, debts and obligations of 

each candidate, his or her authorized 

committee(s), and agents of such 

candidates or committees. Such 

examination and audit shall include, but 

shall not be limited to, expenses 

incurred pursuant to 11 CFR 9003.4 prior 

to the beginning of the expenditure 

report period, contributions to and 

expenditures made from the legal and 

accounting compliance fund established 

under 11 CFR 9003.3(a), contributions 

received to supplement any payments 

received from the Fund, and qualified 

campaign expenses.

§ 9007.2 Repayments.

(a) The Commission shall notify the 

candidates of a political party that a 

repayment of money to the Fund will be 

required in an amount equal to the 

following:

(1) Any payments made to the 

candidate(s) from the Fund in excess of 

the aggregate amount to which such 

candidate(s) was entitled; or

(2) Any expenses incurred by the 

eligible candidates or their authorized 

committees in excess of the aggregate 

payments to which an eligible major 

party candidate is entitled; or

(3) Any contributions accepted by the 

eligible candidates or their authorized 

committee(s) to defray qualified 

campaign expenses, other than 

contributions accepted to make up 

deficiencies in payments from the Fund 

pursuant to the operation of 11 CFR 

9005.2(b), to defray expenses incurred 

for legal and accounting services, or to 

defray those excessive qualfied 

campaign expenses for which 

repayment is already required under 

paragraph (a)(2) of this section; or

(4) Any amount of any payment made 

to the eligible candidates of a political 

party under 11 CFR 9005.2 which amount 

was used for any purpose other than—

(i) To defray qualified campaign 

expenses; or

(ii) To repay loans used to defray 

qualified campaign expenses; or

(iii) To restore funds (other than 

contributions which were received and 

expended by minor or new party 

candidates to defray qualified campaign 

expenses) which were used to defray 

qualified campaign expenses; or

(5) Any amounts expended by the 

candidate from monies received from 

the Fund or from private contributions 

received under 9003.3(b) which amounts 

are not documented in accordance with 

11 CFR 9003.5; or

(6) Any income received as a result of 

investment or other use of public funds 

pursuant to 11 CFR 9004.5, less any 

Federal, State or local taxes paid on 

such income.

(b) The Commission shall notify the 

candidate of its determination that any 

of the circumstances under 11 CFR 

9007.2(a) exist no later than 3 years after 

the end of the expenditure report period. 

The Commission’s notice shall set forth 

the legal and factual reasons for its 

determination that a repayment is 

required and shall also advise the 

candidate of the evidence upon which 

that determination is based. Within 30 

days after receiving notice from the 

Commission, the candidate shall repay 

to the Secretary an amount equal to the 

amount improperly paid, expended,

and/or documented, as determined by 

the Commission under 11 CFR 9007.2(a). 

The candidate may request, in writing, a 

90 day extension of the repayment 

period.

(c) If the candidate disputes the 

Commission’s determination that a 

repayment is required, he or she shall be 

given an opportunity to submit in 

writing, within 30 days after receipt of 

the Commission’s notice, legal or factual 

materials to demonstrate that a 

repayment is not required. Such 

materials may be submitted by counsel 

if the candidate so desires. Upon 

application by the candidate, thè 

Commission may grant a 30 day 

extension for submission of these 

materials by the candidate.

(d) The Commission will consider any 

written legal or factual materials 

submitted by the candidate under 11 

CFR 9007.2(c) in making its final 

determination. Such materials may be 

submitted by counsel if the candidate so

desires.

(e) A final determination by the 

Commission that a candidate must 

repay a certain amount shall be 

accompanied by a written statement of 

reasons for the Commission’s action. 

This statement shall explain the reasons 

underlying the Commission’s 

determination and shall summarize the 

results of any investigation upon which 

the determination is based.

(f) The candidate shall repay to the 

Secretary the amount specified by the 

Commission in its notice of final 

determination within 20 days after the 

date on which the notice is received by 

the candidate. Upon application by the 

candidate, the Commission may grant a 

90 day extension of this period.

(g) In addition to any repayment(s) 

which may be required under 11 CFR 

9007.2(a) through (f), a candidate shall 

be required to return to the Secretary 

any portion of the payment under 11 

CFR 9005.3 which remains unspent after 

all qualified campaign expenses have 

been paid.

(h) No repayment shall be required 

from the eligible candidates of a 

political party under 11 CFR 9007.2 to 

the extent that such repayment, when 

added to other repayments required 

from such candidates under 11 CFR

9007.2, exceeds the amount of payments

received by such candidates under 11 

CFR 9005.3.

§ 9007.3 Additional audits.

In accordance with 11 CFR 104.16(c), 

the Commission, pursuant to 11 CFR 

111.10, may upon affirmative vote of four 

members conduct an audit and field 

investigation of any committee in any 

case in which the Commission finds
Federal Register / Vol 45, No- 126 / Friday, June 27, 1980 / Rules and Regulations 43387

reason to believe that a violation of a 

statute or regulation over which the 

Commission has jurisdiction has 

occurred or is about to occur.

The following technical amendments 

are made to 11 CFR 100.8,11 CFR 106.3, 

and 11 CFR 110.7:

PART 100—SCOPE AND DEFINITIONS

(2 U.S.C. 431)

§ 100.8 [Amended]

1.11 CFR 100.8(b)(15), delete last 

sentence and insert: 

*****

(b) * * *

(15) * * * Expenditures for these 

services by a candidate certified to 

receive Primary Matching Funds under 

11 CFR Part 9034 do not count against 

such candidate’s expenditure limitations 

under 11 CFR Part 9035 or 11 CFR 110.8. 

Unless paid for with federal funds 

received pursuant to 11 CFR Part 9005, 

disbursements for these services by a 

candidate who is certified to receive 

payments from the Presidential Election 

Campaign Fund under 11 CFR Part 9005 

do not count against that candidate’s 

expenditure limitations under 11 CFR 

110.8.

*****

2.11 CFR 100.8(b)(21)(i), delete first 

sentence and insert: 

*****

(b) * * *

(2) Any costs incurred by a candidate 

or his or her authorized committee(s) in 

connection with the solicitation of 

contributions are not expenditures if 

incurred by a candidate who has been 

certified to receive Presidential Primary 

Matching Fund Payments, or by a

candidate who has been certified to 

receive general election public financing 

under 26 U.S.C. 9004 and who is 

soliciting contributions in accordance 

with 26 U.S.C. 9003(b)(2) or 9003(c)(2) to 

the extent that the aggregate of such 

costs does not exceed 20 percent of the 

expenditure limitation applicable to the 

candidate. These costs shall, however, 

be reported as disbursements pursuant 

to 11 CFR Part 104.* * *

PART 106—a l l o c a t io n o f

CANDIDATE AND COMMITTEE

ACTIVITIES

§ 106.3 [Amended]

3.11 CFR 106.3(a), insert as first 

sentence:

(a) This section applies to allocation 

for expenses between campaign and 

non-campaign related travel with 

respect to campaigns of candidates for 

Federal office, other than Presidential 

and Vice Presidential candidates who

receive federal funds pursuant to 11 CFR 

Part 9005. (See 11 CFR 9003.7.) * * *

PART 110—CONTRIBUTION AND

EXPENDITURE LIMITATIONS AND

PROHIBITIONS (2 U.S.C. 441a)

§110.7 [Amended]

4.11 GFR 110.7(a), add the following 

new subparagraph: (а) * * *

(б) Any expenditures made by the 

national, state and subordinate 

committees of a political party pursuant 

to 11 CFR 110.7(a) on behalf of that 

party’s Presidential candidate shall not 

count against the candidate’s 

expenditure limitations under 11 CFR 

110.8.

* * * * *

Dated: June 20,1980.

Max L. Friedersdorf,

Chairman, Federal Election Com m ission.

[FR Doc. 80-19375 Filed 6-26-80; 8:45 am]

B ILU N G CODE 6 715-01-M

SMALL BUSINESS ADMINISTRATION

13 CFR Part 101

[Rev. 2, Arndt. 9]

Organization and Functions

AGENCY: Small Business Administration. 

a c t io n : Final rule.

SUMMARY: Due to reorganization within 

the Small Business Administration, 

portions of Part 101—Administration as 

it pertains to organization, functions, 

and listing of field offices is being 

updated.

DATE: June 27,1980.

FOR FURTHER INFORMATION CONTACT:

Amos B. Cheseboro, Office of Personnel 

Services, Small Business 

Administration, 1441 L St. NW., 

Washington, D.C. 20416, (202) 653-5293. 

SUPPLEMENTARY INFORMATION:

Inasmuch as this Part sets forth the 

Agency's organization and procedures, 

notice of proposed rulemaking and 

public procedure thereon are not 

required by section 553 of Title 5 of the 

United States Code.

Accordingly, pursuant to authority 

contained in Section 5(b)(6) of the Small 

Business Act, 15 U.S.C. 634,13 is revised 

as set forth below.

PART 101—ADMINISTRATION

1. The table of contents is amended 

by revising § 101.2-7a and by adding 

§§ 101.2-7d and 101.2-7e to read as 

follows:

Sec.

* * * * *

101.2- 7a Associate Administrator for

Financial Assistance.

*****

101.2- 7d Associate Administrator for

Investment.

101.2- 7e Assistant Administrator for

Women’s Business Enterprise.

*****

§ 101.2-5 [Amended]

2. Section 101.2-5 is amended by 

deleting the third sentence in its 

entirety.

3. Section 101.2-7 is amended by 

adding a sentence between the second 

and third sentences to read as follows:

§ 101.2-7 Associate Deputy Administrator

for Programs.

* * * Develops policies, procedures, 

and programs to ensure maximum 

participation by women business 

owners in the Nation’s business 

enterprise. * * *

4. Section 101.2-7a is revised as 

follows:

§ 101.2-7a Associate Administrator for

Financial Assistance.

Develops and recommends policies 

concerning the loan programs, including 

related activities of liquidation and 

disposal. Develops plans, operating 

procedures, and standards to effectively 

improve the Agency’s financial 

programs designed to meet the existing 

and potential needs of the small 

business community. Plans, directs, and 

administers the bank certification and 

other lender relation functions. Also, 

plans, directs, and administers the Small 

Business Lending Company (SBLC) 

program, including approving and 

providing necessary regulatory 

oversight. Plans, directs, and 

administers the Agency’s disaster 

operations through contingency 

planning, administration during the 

disaster, and disaster maintenance. 

Recommends physical and product 

disaster declarations to the 

Administrator. Maintains liaison with 

other Government agencies relating to 

the disaster program. Develops program 

goals and objectives within the 

framework of approved policies. 

Reviews and evaluates program 

effectiveness. Serves as a member of the 

Size Appeals Board.

5. Section 101.2-7d is added as 

follows:

§ 101.2-7d Associate Administrator for

Investment.

Develops plans, operating procedures, 

and standards to effectively strengthen 

and improve the Agency’s Investment 

program designed to meet the existing