Federal 

Election 

Commission 

Annual Report 1978 

Federal Election Commission 

1325 K Street, N .W. 

Washington, D.C. 20463 
Commissioners 

Joan D. Aikens, Chairman 

Robert 0. Tiernan, Vice Chairman 

Thomas E. Harris 

John W. McGarry* 

William L. Springer 

Vernon W. Thomson 

Ex Officio Commissioners 

Edmund L. Henshaw, Clerk of the House 

J. S. Kimmitt, Secretary of the Senate 

Statutory Officers 

Orlando B. Potter, Staff Director 

William C. Oldaker, General Counsel 

*Commissioner Neil 0. Staebler continued to serve actively on 

the Commission until the "recess appointment" of Commissioner John W. McGarry on October 25, 1978. 

The Annual Report 1978 was written and publlshad by the Commission's Office of Publications. 

For sale by the Superintendent of Documents, U.S. Government 

Printing Office, Washington, D.C. 20402. 

Stock Number 062-oo3-00651-l 
FEDERAL ELECTION COMMISSION 

1325 K STREET N.W. 

WASHINGTON,D.C. 20463 

To the President of the United States: 

To the Congress of the United States: 

We submit for your consideration the fourth annual report of 

the Federal Election Commission, as required by the Federal 

Election Campaign Act of 1971, as amended. This Annual Report 

1978 describes the activities performed by the Federal 

Election Commission in carrying out its duties under the 

Act and lists the Commission's recommendations for legislative 

action. We hope you will find this a useful summary of the 

Commission's efforts to implement the Federal Election Campaign 

Act. 

Respectfully, 

JOAN D. AIKENS 

Chairman 
Table of Contents 

Page 

Overview 1 

Chapters 

1. Facilitating Disclosure 3 

2. Understanding the Act and the FEC 11 

3. Monitoring the Act 17 

4. Enforcing the Act 21 

5. Planning for the 1980 Presidential 25 

Cycle 

6. Clearinghouse for Election Admin- 29 

istration 

7. The Commission's Organization and 31 

Management 

8. Legislative Recommendations 37 

Appendices 

1. Biographical Data on Commis- 49 

sioners and Statutory Officers 

2. FEC Organization Chart 53 

3. Chronology of Events, 1978 55 

4. 1978 Advisory Opinion Requests 57 

5. FEC Advisory Opinions: Sum- 59 

maries 

6. Summary of Disclosure Files 89 

7. Computer Indices Available 91 

8. FEC Publications and Clearing- 93 

house Studies 

9. FEC Library: Summary of Collec- 97 

tion 

10. FEC Federal Register Notices, 1978 99 

11. Status of Audits 101 

Charts and Graphs Within Text 

Contributions Made by Nonparty Poli- 4 

tical Committees to Congressional 

Candidates 

How the FEC Utilizes Campaign 7 

Finance Reports 

Enforcement Statistics 21 

Budget Allocation 33 

Annual Budget Appropriation 34 

Legislative Recommendations for 38 

Simplifying Reporting Procedures 
Overview 1 

The 1978 election period afforded the Federal 

Election Commission its first opportunity to 

monitor the financing of Federal election 

campaigns on a comprehensive basis. 

During the 1976 election period, Federal candidates and committees were required to comply 

with a law only six months old.1 Programs and 

procedures to administer the Federal Election 

Campaign Act in 1976 were necessarily developed by the Commission under considerable 

time pressure. By the 1978 election period, 

however, the Commission had reevaluated and 

overhauled a number of these procedures and 

programs. 

Understandably, numerous problems and questions concerning compliance with the Act were 

raised by Federal candidates and committees 

operating under the new election law in 1976. 

By the 1978 election period, however, the 

Commission had prescribed a complete set of 

Regulations implementing the Act. The Commission also issued more than 100 advisory 

opinions to Federal officeholders, candidates 

and committees, which answered questions 

on how the Act or Regulations should be 

applied to specific factual sit.uations.2 

Informational outreach programs were also 

augmented to facilitate voluntary compliance 

with the Act. During 1978, Commission representatives addressed a number of public gatherings and sponsored eight seminars. The Commission initiated an informal telephone contact 

system to help candidates and committees 

register and meet reporting obligations of the 

Act. 

Development of the Commission's Reports on 

Financial Activity disclosure series in 1978 

represented a refinement in public disclosure of 

campaign finance activity. For the first time, the 

Commission made available to the public comparative statistical studies on the campaign 

finance activities of Federal candidates and 

committees before election day. In addition, an 

unprecedented volume of campaign finance 

reports were made accessible in 1978, and a 

record number of requests for copies of such 

reports were processed. 

Establishment of a separate Reports Analysis 

Division in 1978 facilitated timely, accurate 

disclosure of the information contained in these 

reports. In addition, changes in the nonfilers 

procedures and more coordinated efforts with 

State filing officials enabled the Commission to 

monitor the Act's registration and reporting 

requirements on a more systematic, thorough 

basis. 

Improved internal procedures to monitor 

compliance with the Act were accompanied by 

the Commission's expeditious handling of compliance matters during 1978. In the final weeks 

of the 1978 election, for example, more enforcement cases were received and closed by the 

Commission than are normally processed in 

several months. The timely handling of these 

compliance cases prevented the Commission 

from becoming unnecessarily involved in 

numerous Federal election campaigns across the 

country. 

The Commission also began laying the administrative groundwork for the 1980 Presidential 

public financing program. It undertook a major 

reassessment of the 1976 public funding program. Based on this evaluation, the Commission 

began to formulate a comprehensive plan to 

administer the Presidential Election Campaign 

Fund in 1980. 

This year's Annual Report describes the procedures and programs the Commission developed 

for a smooth implementation of the Federal 

Election Campaign Act during 1978, and the 

planning processes currently underway to 

administer the 1980 Presidential election cycle. 

1The Buckley v. Va/eo Supreme Court decision handed down on 

January 31, 1976, suspended the Commission's rulemaking 

authoritY. The Commission was reconstituted with full rulemaking powers on May 11, 1976, when the new election law, 

the Federal Election Campaign Act, as amended, went into 

effect. A full set of Regulations implementing Titles 2 and 26 

ofthe Act were prescribed on Apri113, 1977. 

2See 2 U.S.C. §437f. 
Chapter 3 1 

Facilitating Disclosure 

The Act mandates that the Commission make 

available to the public within 48 hours the 

campaign finance reports filed by candidates for 

Federal office (Federal candidates) ·and the 

political committees which support them. 3 

During 1978, the Commission processed more 

than 52,800 campaign finance reports consisting 

of over 1.5 million pages filed by candidates and 

committees. Processing and disseminating the 

information contained in these reports entailed 

the coordinated efforts of the Commission's 

Public Disclosure, Reports Analysis and Data 

Systems Development Divisions and the Press 

Office. Enhanced computer capabilities enabled 

the Commission to disclose campaign finance 

information in a more timely fashion and to 

provide a more sophisticated statistical context 

in which to analyze and understand it. 

Facilitating disclosure involves several basic 

operations: coding and entry of information 

from reports into the FEC's computer system; 

development of computer programs for retrieving the data; and dissemination of retrieved 

data to the public. The following paragraphs and 

the flow chart on pages 6-7 describe each of 

these operations as performed in 1978. 

Processing Reports 

In 1976, the Commission initiated its computerbased information system to index and retrieve 

campaign finance data. In 1978, creation ofthe 

Reports Analysis Division improved and expanded this system. (See Chapter 7, page 32 for a 

description of the division's organization.) 

Teams of reports analysts, each specializing in 

the review of reports filed by one type of filer 

(e.g., Senate candidates, party committees or 

nonparty committees) code the data from 

reports and enter it into the computer. This 

process occurs in two phases: in the first phase 

(Pass I) summary information including microfilm location, gross receipts and gross expenditures is entered into the computer within 48 

hours after the report is received. During the 

second phase (Pass II and Ill), analysts enter 

itemized information into the computer. This 

information, usually entered into the computer 

within 60 days, facilitates more comprehensive 

data retrieval and serves internal monitoring 

functions. (See Chapter 3, pages 17-19.) 

The types of campaign finance data coded and 

entered into the system were expanded during 

1978 to include: debts, cash-an-hand, loans and 

loan repayments, and more detailed information 

on contributions exceeding $100. Data entries 

totaled approximately 399,000. 

The accuracy of data entry was improved as 

well. Computer programs were developed to 

identify errors or omissions occurring in reports. 

By using the output from these programs, 

reports analysts could more easily identify data 

entry mistakes and reporting errors. 

FEC staff prepares microfilm copy of campaign finance 

report filed with the Commission. 

3See 2 U.S.C. §438(a)(4). 
4 

Contributions 

made by Nonparty Political Committees 

to Congressional Candidates 

Graph shows contributions made between January 1, 1977, 

and July 11, 1978. With the exception of nonparty political 

committees with no connected organization, the political com­ mittees represented in this graph are separate segregated funds 

established under Section 441b of the Act. 

Source: Federal Election Commission, FEC Reports on Financial 

Activity 1977-1978, Interim Report No. 2: Party and Nonparty 

Political Committees, September 1978, p. 153. 

Open Seat 

Challenger 

Other 

Incumbent 

Combined total when contributions 

total less than $100,000 

Senate 

() ..,.,

or ooz J:S::-1 () tn:EO 0 caoo 0 0 -·0 

"C 

... <OCT 0 (') ;. ..., "'O "':I ~3[ "0 :I.., :I ::I I<"O"C

... ;;:;· :;.g-11! c51 0 i'r~ .., ...

<D 

., .... .... .... ...... ... .... .... "'

.... a· "' a· "' a· c. :I" 

<D 

"' <" a· :I :I :I :I ~· 

Millions 

of Dollars 

() tn:EO 0 5 -·0 

"C 

0 n :;.il <D ~<"Oo c ... iil .... ., .... .... ;::· a· <D :I 

() or ooz 0 caoo .a"' .,::~ il "'C" :I :I 0 :~51 

iil ;;:;· ;;:;·!l .... .... s .. :I 

a· a· "' a· c. :I :I 

J:S::-1 

al'"iil -3c. 

;.g~ 

Ul 

:I" 

~ 
5 

After data is entered into the computer, the 

Data Systems Development Division cross 

references the information for retrieval purposes. Data entry, cross referencing and retrieval 

occur every day. This process results in daily 

updates of information stored in the computer. 

If, for example, candidate Jones or his principal 

campaign committee filed a report on Wednesday, the summary (Pass I) information from the 

report would appear in the computer indices on 

Thursday. Subsequently, itemized information 

on contributions and expenditures made on 

behalf of Jones would be coded, entered and 

cross referenced to augment the summary 

information. 

Retrieving and Disseminating Data 

Forty computer terminals and a high-speed 

printer located at the Commission permit staff 

and the public to retrieve information from the 

computer system. During 1978, Commission 

staff used approximately 16,000 printouts 

of computer indices. Additionally, 25,000 

printouts were generated in response to requests 

from the public and the press: 12,000 were 

produced within minutes of the request and 

13,000 were provided within 24-48 hours. 

During 1978, the Data Systems Development 

Division developed approximately 500 new 

computer programs, permitting more refined 

retrieval of campaign finance data. Some of 

these new computer programs resulted in the 

Reports on Financial Activity series in 1978, a 

comprehensive study of campaign finance 

activity by candidates, party committees and 

nonparty committees. Not only did the new 

statistical series categorize information in more 

complex ways, but it was also timely. In previous years, statistical studies were not released 

until after the election cycle was completed. 

In 1978, the first three volumes of the Reports 

on Financial Activity series were released before 

the general election. 

Based on cumulative data from campaign 

finance reports filed since January 1, 1977, 

these volumes were published as interim reports. 

Interim Report No. 1 (April 1978) and Interim 

Report No. 2 (September 1978) covered the 

financial activities of party and nonparty committees. Interim Report No. 3 (October 1978) 

focused on U.S. Senate and House campaigns. In 

April 1979, the Commission plans to release 

Interim Report No. 4 on party and nonparty 

committees and Interim Report No. 5 on U.S. 

Senate and House campaigns. In the fall of 

1979, a comprehensive report on the entire 

1977-78 election cycle will be released. 

The Reports on Financial Activity series provided a context for interpreting the existing 

indices of campaign· finance data. The studies 

permitted comparisons between the campaign 

finance activity of a particular committee and 

the activities characteristic of other similar 

committees. 

A typical study included in Interim Report 

No. 2 appears in the chart on page 4. The graph 

summarizes campaign finance activity reported 

by nonparty committees from January 1, 1977, 

through August 4, 1978. It breaks down political contributions made by nonparty political 

committees to U.S. Senate and House candidates 

by candidate status (whether incumbent, challenger or in an open seat race). The six categories of nonparty political committees whose 

contribution patterns are represented include 

committees with no connected organization as 

well as the separate segregated funds of: corporations, labor organizations, trade/membership/ 

health organizations, cooperative organizations 

and corporations without stock. 

The Commission disseminates this campaign 

finance information to the public through its 

Press and Public Records Offices. 

(Continued on page B) 
6 

Candidates and Political Committees File Their Campaign 

Finance Reports and Statements. 

Candidates for the House 

of Representatives and committees which exclusively 

support candidates for the 

House file their reports 

with the Clerk of the 

House of Representatives. 

The Clerk's office forwards 

copies to the FEC. 

Candidates for the Senate 

and committees which exclusively support candidates for the Senate file 

their reports with the Secretary of the Senate. The 

Secretary's office forwards 

copies to the FEC. 

All other reporting entities, 

including candidates for 

the Presidency and committees which support 

them, and party and nonparty committees file 

their reports directly with 

the Federal Election 

Commission. 

All candidates and committees also file a copy of 

their reports with the Secretary of State or equivalent State elections official of the State where 

campaign activity occurs 

or where the committee 

is based. 

FEC Receives All Reports and Begins to Process Them. 

Within 48 hours after their 

receipt, the FEC makes 

copies of the reports (and 

indexes to the reports) 

available to the public in 

the Public Records Office. 

The FEC sends copies of 

reports to the Commission's Reports Analysis 

Division. 

FEC Indexes and Cross References Information Contained 

In Reports. 

The Reports Analysis Division codes information 

from reports and enters it 

into the FEC's computer. 

Data entry occurs in two 

stages: 

Within 48 hours after 

receiving the report, 

summary data from 

the reports is coded 

and entered into the 

computer. 

Subsequently, itemized 

data from the reports 

is coded and entered 

into the computer. 

Each day, the Data Systems Development Division 

updates the computer data 

base by integrating newly 

entered information into 

existing categories of data. 

FEC Makes Campaign Finance Information Available 

to Public. 

The public may review and 

copy microfilm and paper 

copies of reports in the 

FEC's Public Records Office. 

Computer terminals in the 

Press and Public Records 

Offices permit reporters 

and the general public, 

respectively, to obtain 

computerized indexes to 

campaign finance information. 

Utilizing certain indexes, 

the Data Systems Development Division prepares 

comprehensive studies of 

campaign finance activity, 

available in the FEC Press 

and Pub I ic Records Offices. 

FEC Reviews Reports. 

After coding and entering 

data, the Reports Analysis 

Division reviews the reports for accuracy and 

completeness. 

If a report is inaccurate or 

incomplete, the Commission may send the filer a 

Request for Additional 

Information (RFAI). An 

adequate response to the 

RFAI is processed as any 

other report. No response 

may be handled as an enforcement case. 

Computerized indexes to 

campaign finance information are made available to the Reports 

Analysis staff to assist 

their review of reports. 

Computerized indexes 

available to other FEC 

staff through computer 

terminals located throughout the Commission, facilitate the Commission's 

supervisory functions. 
How the FEC Utilizes Campaign Finance Reports 

Candidates Committees 

for House Supporting 

House 

Candidates 

.,! \~·,( ~~ 

U.S. House Reports Reports 

of ... Representatives 

u.s. Federal Election Commission Senate 

I \ 

Presidential Nonparty Committees 

Candidates & 

Party Candidates 

Supporting 

Committees 

Committees Committees for Senate 

Senate 

Candidates 

..... FEC 

0' Indexes and ... ~q,q Cross References 

Reports Reports ~~,,= \

\ ~ /1(' 

'"~ 

FEC Makes Information 

From Reports Available 

to Public 

I I "J:l T T '? 

0.. "0"' '=. Public "' ~ 

Press '3.

Records Office Office 

\ \ 

FEC Reviews 

Reports 

7 
8 

The Press Office 

In responding to information requests from the 

media, the Press Office uses daily updates of the 

computer indices to provide reporters with such 

information as: listings of candidates who 

received contributions from a particular nonparty committee; identification of a political 

action committee's sponsor; and information on 

whether a particular candidate or committee 

registered or filed a recent report with the 

Commission. Periodically, the Press Office also 

disseminates press releases summarizing statistical studies such as those contained in the 

Reports on Financial Activity series. 

The Public Records Office 

Members of the public can also retrieve data 

from the FEC's two computer terminals located 

in the Public Records Office. During the 1978 

election period, as in the past, computer printouts could be obtained listing the total gross 

receipts and expenditures of political committees (Index C); candidates supported by committees, including total aggregate contributions 

to, or expenditures on behalf of, each candidate 

by committees (Index D); and other information 

on candidates and their supporting committees, 

including listings of all committees forwarding 

contributions to the candidates and making 

expenditures on their behalf (Index E). In 

addition, printouts of two new indices were 

made available to the public: the G Index and 

the 48-Hour Telegram Index. Portions of the G 

Index provided listings of individuals making 

contributions of $500 or more to Federal 

candidates and committees.4 (For a full description of G Index capabilities, see Appendix 7. 

The 48-Hour Telegram Index listed contributions of $1,000 or more received by candidates 

and their authorized committees within 10 days 

of elections. 

FEC's Reports on Financial Activity summarize campaign finance transactions of candidates and political 

committees active in the 1977-78 election cycle. 

Providing the public with updated indices is but 

one way in which the Public Records Office, a 

branch of the Public Disclosure Division, fulfills 

its disclosure function. As a "storefront" operation located on the street floor of the Federal 

Election Commission, the Public Records 

Office also maintains copies of all reports and 

statements filed since 1972. Microfilm copies of 

all reports are kept permanently on file, including approximately 1.5 million pages of reports 

filed in 1978. As space permits, Public Records 

also maintains paper copies of current reports 

for public inspection. 

The Office is open for public use weekdays from 

9 a.m. to 5 p.m. and evenings and weekends 

during the preelection period. A library facility 

with ample work space and a knowledgeable 

staff facilitates information retrieval. The Public 

Records Office served 7,100 visitors using these 

information resources during 1978. 

4 Pursuant to restrictions in 2 U.S.C. §438(a)(4), the G Index 

with its names of contributors and addresses is available for 

public inspection exclusively at the Commission and may not 

be mailed out or copied. 
9 

There is no charge for reviewing the files in the 

Public Records Office and any document can be 

copied at a cost of 10 cents per page.5 The 

Public Records Office copied a record number 

(over 276,485 pages) of statements and reports 

on self-service copy machines during 1978 for 

the general public. The Office also processed 

written requests (1 ,675) and telephone requests 

(3,558) for copies of specific candidate and 

committee reports. Altogether, staff processed 

more than 12,350 requests for documents in 

1978. 

To facilitate public access to a variety of FEC 

documents, the Public Records Office expanded 

its microfilm program in 1978 to include closed 

compliance cases and data on contributors to 

Federal candidates and committees. Other 

documents and informational aids available in 

paper copies include: 

-- Commission documents (press releases, memoranda, agendas and minutes of Commission 

meetings); 

-- FEC Opinions (Index, Advisory Opinion 

Requests, Advisory Opinions, comments on 

Advisory Opinions); 

-- Enforcement cases (Index, closed compliance 

actions); 

-- Audits (GAO 1972-74, FEC); 

-· Court cases (Buckley v. Valeo, etc.); 

-- FEC publications (Campaign Guides, Record, 

Annual Report); 

-- FEC Reports on Financial Activity; 

-- Presidential matching funds certifications; 

-- Hearing transcripts (upon request); 

-- General information (newspaper articles, 

studies on campaign finance by other organizations, informational handouts). 

In the FEC's Public Records Office the public may 

locate paper copies of campaign finance reports filed by 

candidates for Congress. 

5Anyone using such documents is reminded, however, of the 

Act's requirement that any information copied from such 

reports and statements "shall not be sold or utilized by any 

person for the purpose of soliciting contributions or for any 

commercial purpose." 2 U.S.C. §438(a)(4). 
10 

FEC's toll-free line permits people all over the country 

to get information frorn FEC's professional staff. 
Chapter 2 11 

Understanding 

the Act and the FEC 

The Federal Election Commission has been the 

major source of information concerning the 

Federal Election Campaign Act and Regulations 

since the Commission first opened its doors in 

April 1975. Numerous outreach programs, 

including toll-free telephone lines, free publications, informational mailings, and the conduct 

of Commission meetings in open session attest 

to the FEC's commitment to providing information on the Act, the Regulations and Commission activities. 

Recognizing the direct correlation between a 

thorough understanding of the Act and Regulations and voluntary compliance, the Commission 

has always placed a high priority on providing 

information and assistance to candidates for 

Federal office and to the political committees 

which support them. 

To meet this objective, the Commission issues 

advisory opinions to Federal officeholders, 

political committees and candidates who raise 

questions about the application of the Act or 

FEC Regulations to specific factual situations. It 

provides candidates and committees with the 

forms, pamphlets and personal assistance they 

need to report correctly and otherwise comply 

with the Act. The Commission also uses such 

monitoring functions as field audits and review 

of campaign finance reports as educational tools 

for candidates and committees. 

Information programs designed to promote both 

voluntary compliance with the Act and Regulations and a wider understanding of the FEC's 

role in administering the Act are detailed below. 

Advisory Opinions 

Process 

Advisory Opinions (AO's) issued by the Commission assist Federal officeholders, candidates 

and committees with voluntary compliance. An 

opinion explains how the Commission would 

apply a general rule of law, as stated in the 

Act or Regulations, to a specific factual situation described by the requeSter. Any qualified 

person requesting an Advisory Opinion who in 

good faith acts in accordance with the opinion 

will not be subject to any sanctions under the 

Act. The opinion may also be relied on by any 

other persons involved in a specific transaction 

which is"... indistinguishable in all its materials 

aspects ..." 6 from the activity or transaction 

discussed in the AO. 

All advisory opinion requests (AOR's) are made 

public in the Office of Public Records at the 

Commission. Interested members of the public 

may make comments on any AOR within 10 

days of the date it is made public. A line description of the AOR and other pertinent information for obtaining copies is published on a 

monthly basis in the Commission's newsletter, 

the Record. 

The Office of General Counsel considers each 

request for an AO. Occasionally, it seeks additional information from the requester to clarify 

the facts. The Office then presents a draft AO to 

the Commission during a regularly scheduled 

open meeting. All AO's must be approved by at 

least four Commissioners. Once issued, AO's are 

made public in the Office of Public Records and 

summarized in the Record. Responding to the 

many requests received during the 1978 election 

period, 105 AO's were issued by the Commission in 1978. 

Issues Addressed by Advisory Opinions 

Must a subordinate party committee register if it 

contributes less than $1,000 in a calendar year 

to candidates for Federal office? Under what 

circumstances would a Federal candidate's 

activities be considered campaign-related or 

noncampaign-related? A number of such election-year issues were addressed in Advisory 

Opinions issued by the Commission during 

1978. Three of the major issues covered by 1978 

Advisory Opinions are discussed in detail below. 

(All AO's issued in 1978 are summarized in 

Appendix 5 of this Report.) 

6see 2 U.S.C. §437f(b)(2). 
12 

State Party Activity: Federal election activity by 

State and local party committees was clarified in 

a series of Advisory Opinions. In AO 1978-9, 

the Commission said that the Republican county 

committees in Iowa would appear to qualify as 

independent political committees not affiliated 

with the State central committee because the 

facts indicated they were not established, 

financed, maintained or controlled by the State 

central committee. By contrast, the Commission 

concluded that the party's auxiliary bodies 

would be considered affiliated to the State 

central committee because the State committee's bylaws provided for their establishment. 

Consequently, county committees could have 

separate contributions limits, both for contributions they received and contributions they made 

to Federal candidates, whereas auxiliary committees would share the State committee's 

contribution limitations. 

In the case of coordinated party expenditures 

(§441a(d)), the Commission said that both 

county and auxiliary units would be required to 

share the overall State limits. 

Advisory Opinion 1978-9 also determined that 

each Iowa Republican county committee or 

auxiliary body which had not yet qualified as a 

political committee under the Act1 could make 

contributions up to $1,000 in a calendar year to 

candidates for Federal office without incurring 

any obligation to register or report. Until an 

auxiliary party unit became a political committee, its contributions generally would not 

count against the State committee's limitations 

and would not have to be reported. 

In several other opinions, the Commission 

addressed the issue of allocating party expenses 

between Federal and non-Federal activities. 

Commission Regulations require that "party 

committees and other political committees 

which have established Federal campaign committees pursuant to § 102.6 [of FEC Regulations] shall allocate administrative expenses on a 

7See 2 U.S.C. §431 (d). 

reasonable basis between their Federal and 

non-Federal accounts ...." These administrative expenses include rent, personnel, overhead 

and other day-to-day costs of the committee. 

Expenses for general get-out-the-vote or registration drives must also be allocated between 

Federal and non-Federal accounts. 

In three opinions issued to party committees in 

Kansas, Michigan and Nevada, the Commission 

clarified this provision of the Regulations. AO's 

1978-28 and 1978-50, for example, held that 

even though a get-out-the-vote drive was not 

held directly on behalf of a clearly identified 

candidate for Federal office, such activity in an 

election year where Federal candidates appeared 

on the State ballot would, at least in part, be 

"for the additional purpose of influencing the 

election of persons to Federal office." Consequently, get-out-the-vote or registration drives 

would have to be allocated between Federal and 

non-Federal accounts. 

In the three opinions, the Commission held that 

the portion of the expenses allocable to the 

Federal committee need not be attributed to 

the limits of any specific candidate for Federal 

office unless they were made on behalf of, and 

could be attributed to, a clearly identified 

candidate. 

The Commission also concluded in AO 1978-10 

(Part A) that the portion of registration and 

get-out-the-vote costs allocable to non-Federal 

elections could be paid from funds raised under 

applicable State laws, including funds not 

permissible under Federal law. Depending on the 

State, therefore, expenses allocable to nonFederal elections could be defrayed with corporate, labor and cash funds, or with donations 

exceeding the contribution limits established by 

the Act. Party committees were required, 

however, to use only funds lawfully contributed 

under the Act to defray that portion of expenses 

allocable to Federal elections. 

This conclusion modified two previous Commission responses to Advisory Opinion Requests 
13 

(1976-72 and 1976-83) which held that party 

committees could only use funds lawfully 

contributed under the Act to defray costs 

of get-out-the-vote drives held in a Federal 

election year. 

Campaign vs. Noncampaign Activity: In several 

advisory opinions issued in 1978, the Commission distinguished between activity which was 

campaign-related (and, thus, subject to the 

limitations of the Act) and activity not related 

to Federal elections. The Commission considered several kinds of activities, including the 

sponsorship of intern programs by Members of 

Congress and participation in public policy 

groups or charitable organizations. 

In two opinions, AO 1977-27 and 1978-44, the 

Commission determined that an intern program 

proposed by a Member of Congress was not 

campaign-related. Moreover, since the funds 

raised in connection with the program were 

placed in a separate account managed by an 

outside organization and the Member had no 

control over the funds, the Commission concluded that the funds donated for the programs 

were not given to support the Member's activities as a Federal officeholder. They were, 

therefore, not subject to the office account 

reporting requirements in Part 113 of the 

Commission's Regulations. 

The Commission also issued several opinions 

clarifying when a candidate's appearance before 

the public was not considered campaign-related. 

In AO 1977-54 and AO 1978-15 the Commission ruled that a candidate's participation 

in publicizing and raising funds for issueoriented and charitable drives, whose major 

purpose was not the nomination or election of 

that candidate to Federal office, would not be 

considered campaign-related provided: 

-- The activities did not involve the solicitation, 

making or acceptance of contributions to the 

candidate's campaign; and 

-- The activities did not involve any communication which expressly advocated the election 

of that candidate to Federal office, or the 

defeat of any opponent. 

Excess Campaign Funds: Several opinions issued 

by the Commission in 1978 responded to questions raised by Congressional candidates concerning the use of excess campaign funds. In 

these opinions, the Commission explained 

that, under the Act, candidates may use excess 

campaign funds in any manner consistent with 

Federal and State laws, including: 

-- Payment of staff and incidental expenses in 

the performance of duties "imposed by virtue 

of having been a Member of Congress" (AO 

1978-43); 

-- Production of film, to be shown as a television public service announcement, depicting 

facilities and services which a Congressman 

makes available to his constituents (AO 1978-

76); 

-- Payment of expenses of a buffet luncheon 

given in honor of a Congressman (AO 1978-

85); and 

-- Transfer of funds to a research organization 

for the establishment of a fellowship program 

(AO 1978-87). 

Additionally, in AO 1978-94, the Commission 

concluded that excess funds of a deceased 

candidate may be transferred to a Federal or 

State campaign of the late Congressman's son, to 

a political organization, to the surviving members of the late Congressman's family and to 

campaign committee staff. Transfers to a 

Federal campaign would be subject to contribution limits. 

In all these opinions, the Commission stated that 

it could not comment on the applicability of 

Senate and House Rules or Internal Revenue 

Service Regulations since they were not within 

the Commission's jurisdiction. 

The FEC's Information Division 

The Commission's Information Division defines 

as its primary mission the supplying of information and assistance to Federal candidates and 

political committees. Secondarily, the Division 

tries to help the general public understand 
14 

Commission functions and activities. Its programs are administered by three branches: the 

Office of Public Communications, the Press 

Office and the Publications Office.8 

The Office of Public Communications 

The Office of Public Communications is in 

direct contact with individuals who have questions about the Act and the FEC. In response to 

inquiries and requests for materials by candidates, committees and the general public, the 

Office of Public Communications handled nearly 

46,000 telephone inquiries in 1978 on its 

six toll-free lines (800/424-9530) and two 

regular telephone lines. Staff filled an estimated 

20,000 individual requests for materials and 

responded to over · 500 general information 

letters. During 1978, as in previous years, 

inquiries handled by staff of the Public Communications Office ranged from general information on FEC procedures to registration 

and reporting obligations for candidates and 

committees. The Office also refers calls outside 

FEC jurisdiction to appropriate State or Federal 

agencies. 

Periodically in 1978, the Office of Public 

Communications arranged FEC-sponsored 

seminars at various locations across the United 

States. On occasion, FEC staff and Commissioners participating in seminars focused on 

issues of particular interest to certain groups. 

More often, seminars were general in scope, 

encompassing basic points of the law, Commission processes for handling and reviewing reports 

of candidates and committees, and services and 

information available from the Commission. A 

good portion of the eight seminars held in 1978 

was spent responding to questions from participants. 

The Commission also accepted invitations to 

address meetings sponsored by other organizations. During 1978, Commissioners and FEC 

staff made pub I ic appearances in a majority of 

the 50 States and the District of Columbia. They 

addressed such widely diverse groups as A 

Presidential Classroom for Young Americans, 

the Federal Bar Association, the American 

Land Title Association, the Ohio Council for 

Social Studies and the Committee on Continuing 

Education. 

The Public Communications Office also assumed 

responsibility for an "educational outreach program," a new procedure in the Commission's 

nonfilers program. (For a detailed description of 

the nonfilers program, see Chapter 3, pages 

17-18.) A "prior notice" was sent before each 

State primary to all candidates running for Federal office in the State and to their principal campaign committees. The prior notice reminded 

candidates and their committees of the Act's 

registration and reporting requirements. Approximately one week after the prior notice mailing, 

Public Communications staff tried contacting 

candidates' principal campaign committees by 

telephone to offer assistance with any difficulties they might have encountered in registering 

or reporting. 

The program was repeated for the general 

election period and encompassed all candidates 

and committees on general election ballots. Two 

to three weeks before the general election, 

another series of telephone calls was made, 

principally to unregistered candidates and to 

minor party, independent and write-in candidates. 

Prior notices were also sent to all candidates and 

all political committees registered with the 

Commission, reminding them of deadlines for 

quarterly and year-end reports. 

Lists of newly registered candidates and committees provided by the Commission's Coordinator of State Disclosure helped implement 

another facet of the educational outreach program. (For a description of this Commission 

operation, see Chapter 3, page 18.) To facilitate 

compliance with the Act, those on the lists 

8The Information Division also includes the National aearinghouse on Election Administration. For detailed information, 

see Chapter 6. 
15 

received information packets containing brochures and forms. Individuals who were recognized by States as qualified candidates, but who 

had not registered under the Act, also received a 

registration packet. These included candidates 

who had not formally declared their candidacy, 

but who could be defined as candidates under 

the Act. 9 

Press Office 

During 1978, the Press Office handled approximately 6,000 calls from media sources around 

the country. By coordinating all media questions 

and requests for information, the Press Office 

insured uniform dissemination of information 

concerning Commission policies and actions. 

In addition to responding to inquiries, the Press 

Office issued 65 press releases on Commission 

decisions, policies and actions, as well as notices 

of Commission meetings in 1978. Eleven of 

these press releases focused on statistical studies 

published in the FEC's Reports on Financial 

Activity series. These press releases served as a 

conduit for widespread dissemination of campaign finance information by print and broadcast media. 

The Press Office received all public inquiries 

about compliance matters, and was responsible 

for placing closed compliance cases on the 

public record. Additionally, it handled requests 

for information filed under the Freedom of 

Information Act. 

Publications Office 

In 1978, the Publications Office overhauled its 

Campaign Guide series to consolidate in a single 

publication all information pertinent to one 

audience. Three different Guides are now 

available for three respective audiences: The 

Campaign Guide for Congressional Candidates 

and Their Committees, the Campaign Guide for 

Political Committees and the Campaign Guide 

for State and Subordinate Party Committees. 

Commission publishes a variety of materials to help 

candidates and political committees understand the 

campaign finance law. 

Information on Commission activities and 

decisions was published in one central source, 

the FEC Record, the Commission's monthly 

newsletter. During 1978, the Record expanded 

its coverage to include certain announcements 

previously carried in the Federal Register. 

While the Publications Office's first priority 

continued to be satisfying the informational 

needs of its clients -- candidates running for 

Federal office and the committees which support them -- the Office fulfilled a second objective in 1978. It published a general information 

pamphlet intended for wide public distribution. 

The FEC and the Federal Campaign Finance 

Law included historical background on the 

Commission, a brief summary of the Act and a 

9See 2 U.S.C. §431 (b). description of how the Commission administers 
16 

it. An initial mailing of approximately 12,000 

copies went to political committees, election 

officials and other in'terested organizations. 

By December 1978, the Commission had also 

received 700 requests for more than 26,000 

copies of the brochure. (For a complete list of 

FEC publications, see Appendix 8.) 

The Audit Process 

The FEC's Audit Division is charged with 

verifying campaign finance information through 

audits of candidates and committees. From the 

inception of its audit program in 1975, however, 

the Commission has stressed the importance of 

using its audit staff to help educate candidates 

and committees on proper recordkeeping and 

reporting procedures. 

As an integral part of all field auditsI thereforeI 

the auditors routinely advise the auditee of any 

disclosure or compliance problems found during 

the audit. When appropriate, auditors recommend amendments to committees' reports and 

offer suggestions to improve accounting procedures. The Audit Division also began updating 

its Bookkeeping and Reporting Manual during 

1978. The Manual is a compendium of bookkeeping procedures to assist Federal candidates 

and political committees in preparing reports 

required under the Act. (For a full description 

of how the Audit Division meets its monitoring 

objectives, see Chapter 3, pages 19-20.) 

Assistance Provided by 

Reports Analysts 

The Reports Analysis Division assigns teams of 

analysts to review reports submitted by specific 

categories of filers. (See Chapter 1, page 3.) For 

example, one team reviews reports filed by 

candidates for the House of Representatives; 

another team reviews nonparty committee 

reports. This system permits reports analysts to 

become familiar with the reporting and recordkeeping procedures, contribution limits and 

financial transactions characteristic of a specific 

category of filers. Candidates and committees 

informally contact these analysts for guidance 

on meeting their reporting obligations and filling 

out reports. The analysts also familiarize candidates and committees with methods of retrieving 

campaign finance information from the Commission's computer. 

Public Accessibility to 

FEC Information 

During the three and one-half years it has been 

operational, the Commission has always been a 

"sunshine agency," debating and deciding on its 

agendas in full public view. The Commission 

formalized this commitment in 1977 when it 

adopted its Sunshine Act Regulations. These 

Regulations require FEC meetings to be publicly 

announced in advance and conducted in open 

session, except when Commissioners discuss 

alleged violations of the Act, audits and personnel matters. 

In 1978, virtually all items discussed at the 

Commission's open meetings, including substantive issues, were available in written form before 

meetings began. Any interested person can 

attend an open meeting. If the meeting room is 

full, a loudspeaker carries the discussion into an 

adjacent room where the proceedings can be 

clearJy heard. 
Chapter 17 3 

Monitoring the Act 

Monitoring compliance with the Act requires the 

coordinated efforts of three divisions within the 

Commission: the Reports Analysis, Audit and 

Data Systems Development Divisions. Efforts by 

reports analysts to secure additional or more 

accurate information from filers enables the 

Commission to perform its disclosure function 

more effectively. Disclosure can only be as 

accurate and complete as the reports which are 

filed. In addition to improving disclosure, 

monitoring activities encourage compliance 

with the Act's reporting requirements. Filers 

may respond directly, for example, to analysts' 

requests for more information. Or they may feel 

compelled to file complete and timely reports 

because they know the Commission reviews each 

document filed, checking information against 

computer indices updated daily by the Data 

Systems Development Division. Finally, review 

of documents by reports analysts and field work 

by auditors may uncover possible violations of 

the Act. In this context, monitoring can be seen 

as a prelude to enforcement procedures. 

Monitoring Reporting Obligations 

Reports analysts review reports filed by candidates and committees in an effort to ensure 

accurate and complete disclosure and to encourage compliance with the Act's reporting requirements. If an analyst identifies an error or omitted information in a report or statement, the 

Reports Analysis Division sends the filer a 

Request for Additional Information (RFAI). If 

the filer fails to provide adequate information, 

the matter may ultimately be referred to the 

Office of General Counsel for review and further 

compliance action. Similarly, if a preliminary 

review of a report indicates on its face an 

"apparent violation," such as acceptance of a 

contribution in excess of statutory limits, a 

Surface Violation Letter is sent to the filer. If 

the filer ultimately fails to supply a satisfactory 

response to the inquiry, the Reports Analysis 

Division refers the matter to the Office of 

General Counsel. Or, if a report or a series of 

reports filed by a candidate or committee 

contains accounting irregularities which RFAis 

cannot clarify, the Reports Analysis Division 

refers the matter to the Audit Division for 

further investigation and a possible field audit. 

A revised Review Manual provides guidelines to 

analysts for determining the accuracy, completeness and uniform treatment of reports filed 

by Senate and House candidates. The Manual 

was developed in 1978 by the Reports Analysis 

Division in conjunction with the Office of 

Planning and Management. 

The Nonfilers Program 

To monitor the Act's disclosure requirements in 

1978, the Reports Analysis Division supplemented and expanded the nonfilers procedures 

originally adopted in 1976. During the 1978 

election period, these procedures focused on 

two major areas: registration requirements and 

reporting obligations. Specifically, the Commission monitored failure to: register as a candidate; designate a principal campaign committee; 

designate an authorized committee; file a 

Statement of Organization; register as a political 

committee; or file required reports of receipts 

and expenditures. In addition, the Commission 

established a four-person nonfilers team within 

the division to identify filers who failed to file 

required reports prior to elections. 

To ensure reporting by candidates and committees, the 1978 nonfilers program also incorporated an educational outreach effort. The Office 

of Public Communications sent prior notices to 

all candidates and their principal campaign 

committees before each primary election. The 

Office then made a second attempt to remind 

candidates of their registration and reporting 

obligations by telephoning principal campaign 

committees prior to the State primaries, and 

political and candidate committees prior to the 

general election. (See Chapter 2, pages 19-20 for 

more details on this program.) 

The Commission established a more structured 

approach to tracking nonfilers during 1978. 

With support from the Data Systems Develop-
18 

ment Division, a computer-generated list was 

created periodically by the Reports Analysis 

Division from State ballot listings. The computer 

list consisted of names of candidates and committees required to file reports for given reporting periods. Candidates and committees who 

met filing deadlines were deleted from the list. 

The remaining list of nonfilers was circulated to 

the Commissioners for their review. Upon the 

receipt of an affirmative vote of four Commissioners, the list was then transmitted to Western 

Union along with the text of a notice indicating 

the Commission had found "reason to believe" a 

violation of the Act had occurred. Mailgrams 

were then dispatched to nonfilers. Followup 

calls by reports analysts again advised nonfilers 

of their filing obligations. 

If mailgram recipients did not respond adequately, or failed to respond at all, after an 

affirmative vote of four Commissioners a second 

mailgram was sent stating the Commission found 

"reasonable cause to believe" the Act had been 

violated. Continued noncompliance with reporting requirements resulted in the Commission's 

publishing the names of those candidates and 

committees who failed to file as required in the 

Act. 1 0 The Commission published the names of 

1,054 such nonfilers during 1978.11 As of 

February 2, 1979, 437 of these nonfilers had 

filed reports and were in compliance. 

In addition to publishing the names of nonfilers, 

the Commission has authority to undertake 

further enforcement action, including civil court 

enforcement and the imposition of civil penalties. 

Nonfilers Procedures at the State Level 

The Act requires candidates and committees to 

file copies of their Federal campaign finance 

reports with their Secretary of State or equivalent State elections officer. 1 2 Each of the 50 

States therefore maintains copies of these 

campaign finance reports for public inspection 

and copying. 

The Act does not, however, require the States to 

notify nonfilers or late filers of their filing 

obligations. This monitoring task was the 

responsibility of the Commission's Coordinator 

of State Disclosure, an office within the Reports 

Analysis Division. By comparing the FEC's computerized list of Federal candidates with those 

of the States, the Commission could determine 

which candidates failed to file copies of their 

reports with the States. As a result of this kind 

of cooperation, the incidence of nonfiling at the 

State level was reduced by approximately 

80 percent during 1978. 

The Coordinator of State Disclosure also obtained State ballot lists of Federal candidates who 

had filed with State election officers. The FEC 

then sent these candidates information on their 

registration and reporting obligations under the 

Act, as well as prior notices reminding them of 

reporting dates. (See Chapter 2, pages 14-15 for 

more detail on this function.) 

In conjunction with the Clearinghouse for 

Election Administration, the FEC in turn 

provided State and local officers with support 

services. During 1978, many State election 

officials visited the Commission to determine 

how reports were processed; to review compliance procedures; and to acquaint themselves 

with the FEC's computer system, microfilm 

processes and disclosure procedures. 

Monitoring Contribution 

Prohibitions and Limitations 

A new computer program developed in 1978 

will be implemented in 1979 to facilitate reports 

analysts' monitoring of individual contributions 

10 2 U.S.C. RA 

~38(a)(7).

11 This figure reflected failure to file the following reports 

during 1978: monthly reports; quarterly reports; pre- and 

post-primary reports; and pre- and POst1Jeneral election 

reports. This figure does not include party, nonparty and 

independent expenditure committees who failed to file preand POst1Jeneral election reports. 12 2 u.s.c. §439. 
19 

to candidates, national party committees and 

other political committees to determine possible 

instances of excessive contributions. The computer program will also enable the Commission 

to monitor contributions by other political 

committees as follows: multicandidate committees may be monitored for contributions to 

candidates, national party committees and 

other political committees; and party committees may be monitored for transfers to candidates and other political committees. 

Auditing Reports 

Through the Audit Division's audits of candidates and committees, the Commission directly 

verifies campaign finance information. In 

addition to requiring audits of Presidential 

candidates receiving public funding, the Act 

requires the Commission to audit from time to 

time other committees with reporting obligations under the Act. 1 3 

In conducting field audits of political committees during 1978, the Commission had three 

objectives: verifying reporting accuracy, determining compliance with the Act and providing 

guidance in bookkeeping procedures. During 

1978, the Audit Division's field audits included 

60 State party committees and four nonparty 

committees. The Audit Division also finalized 

and made public 110 audit reports, including: 

81 Congressional audits, 13 State party audits 

and six audits of national Congressional campaign committees. 

In December 1978, the Commission reaffirmed 

the Audit Division's current audit policy, 

adopted in November 1976 and revised in 

April 1978. This policy covered audit activity to 

be conducted during the remainder of Fiscal 

Year 1979. 

Audit manager reviews audit performed by FEC staff. 

The approved policy called for audits of all 

categories of committees registered under the 

Act, including referral audits approved by the 

Commission. (Referral audits include candidates 

and committees, referred by the Reports 

Analysis Division or the Office of General 

Counsel, whose reports and statements indicate 

a need for assistance in improving reporting or 

recordkeeping systems.) Top priority would be 

given to winding up the last of the 1976 Presidential audits and the first cycle of the nonparty 

and party committee audits. (The status of FEC 

audits, as of January 10, 1979, is summarized in 

Appendix 11.) 

Findings of House and Senate Audits 

In August 1978, the Commission approved the 

Audit Division's Report on the Random Audits 

Conducted of Congressional Elections, compiled 

from 106 audits of Congressional candidates and 

their committees. The Report summarized the 

findings of the audits and described the areas 13 2 U.S.C. §438(a)(8). 
20 

which posed particular problems for candidates 

and committees. The highest rate of error, the 

Report found, occurred with regard to some of 

the least complicated requirements of the Act. 

The Report highlighted the four most frequent 

errors or omissions noted during the audits: 

1. Inadequate Supporting Documentation for 

Expenditures (11 CFR 10219(c)) 

Many committees audited had not obtained 

and/or kept receipted bills, stating the particulars for expenditures in excess of $100 

(or those which aggregated in excess of $100 

to the same payee) during the calendar year. 

Where a receipted bill was not available, 

the committees had failed to keep, as an 

alternative, the cancelled check showing 

payment, together with the bill, the invoice or 

a contemporaneous memorandum of the 

transaction supplied by the payee. 

2. Failure to Itemize Contributions and Expenditures (2 U.S.C. §434(b)(2) & (9)) 

The committees frequently failed to itemize a 

series of contributions which, in the aggregate, exceeded $100 in a calendar year from 

the same contributor or a series of expenditures which, in the aggregate, exceeded $100 

to the same person during a calendar year. 

3. Failure to Itemize All Transfers Received Or 

Made (2 U.S.C. §434(b)(4)) 

Committees did not always itemize all transfers, 1 4 despite instructions on the reporting 

forms and schedules. Most of the undisclosed 

transfers were in amounts of $100 or less, 

suggesting that the committees were unaware 

of the requirement to itemize any transfer, 

regardless of amount. 

4. Acceptance ofProhibited Contributions 

A substantial number of committees accepted 

contributions from corporate and labor 

sources (2 U.S.C. §441b). Committees also 

accepted contributions in excess of the dollar 

limitations (2 U.S.C. §441a). 

Proposed Changes in Bookkeeping and 

Reporting Procedures for 1980 Elections 

Based on the cumulative experience of auditing 

Presidential committees in the 1976 election 

period and other political committees since 

1976, the Audit Division proposed a comprehensive package of new bookkeeping and 

reporting procedures for the 1980 election 

cycle. Focusing primarily on the matching funds 

and reporting requirements of Presidential 

candidates qualifying for public funding, the 

new procedures were designed to fill procedural 

gaps and solve other problems encountered in 

the 1976 election period. 

During 1978, the Commission adopted guidelines prepared by the Audit Division on itemizing the "particulars" of expenditures in campaign finance reports of non-Presidential candidates and committees. Under these new guidelines, the particulars (or purpose) of expenditures would be characterized under any of the 

following categories: "Transportation, consulting/professional fees, surveys/polls, advertising, 

printing/photography, fundraising, administration/operating, postage and meetings." The 

following three categories, however, would not 

be acceptable: 

1. "Credit Cards." Instead, the particulars (i.e., 

one of the categories listed above) of the 

credit card expenditures would have to be 

disclosed, together with the identification of 

each person (including hotels, restaurants, 

etc.) to whom expenditures were made by 

credit card in an aggregate amount exceeding 

$100. 

2. "Get-Out-The-Vote/Election Day," i.e., when 

such expenditures exceeded either $1,000 to 

any one person or $2,500 to all persons 

during a reporting period. Instead, the particulars (i.e., those categories listed in the 

paragraph above) of each actual election-day 

expenditure would have to be disclosed. 

3. "Advances." Instead, the particulars of the 

actual use of each expenditure (i.e., those 

categories listed in the paragraph above) 

would have to be disclosed. 

14 The Act defines a transfer as a contribution (of any type 

including, for example, contribution in-kind) from a political 

committee or political organization to a candidate (or his/her 

authorized committee) or another political committee. (2 

U.S.C. 100.4(a)(4); 106.1 (b)). 
Chapter 21 4 

Enforcing the Act 

Enforcement Procedures 

The Federal Election Campaign Act, as amended, vests the exclusive primary jurisdiction for 

the civil enforcement of the Act in the Federal 

Election Commission. 15 

Possible violations of the Act come to the 

Commission's attention either through the 

FEC's own internal monitoring procedures or by 

formal complaints originating outside the 

Commission. The potential violations are assigned case numbers by the Office of General 

Counsel and become "Matters Under Review" 

(MURs). 

At each stage in the enforcement process, the 

confidentiality of the investigation is maintained1 6 and respondents are afforded a reasonable opportunity to demonstrate that no action 

should be taken against them. If a preliminary 

investigation determines that there is "reasonable cause to believe" a violation of the Act has 

occurred, the Commission is required to seek 

informal methods of settling cases by conference, conciliation and persuasion. If a conciliation agreement cannot be reached, the Commission may find there is "probable cause to 

believe" the Act has been violated and authorize 

the filing of a civil enforcement action in United 

States District Court. The Commission may also 

refer the case to the Attorney General for 

criminal prosecution if it "determines that there 

is probable cause to believe that a knowing and 

willful violation" of the Act has occurred or is 

about to occur. 17 The Commission may enter 

into conciliation agreements with respondents 

which require the payment of civil penalties. 

After compliance cases are closed, the Commission makes public the names of the parties 

involved and the case file.18 

15 Pursuant to 2 U.S.C. §437c(b)(1 ). 

16 See 2 U.S.C. §437g(a)(3). 

17 2 U.S.C. §437g(a)(S)(D). 

18 In accordance with 2 U.S.C. §437g(a)(6)(C). 

Enforcement Statistics 

Annual Caseload - Chart I 

Status of Cases 1977 1978 

Pending at the Beginning 78 93 

of Year 

Opened During Year 133 481 

Closed During Year 118 401 

Pending at End of Year 93 173 

Disposition of Cases - Chart II 

6-1-75 to 

12-31-77 1978 Total 

Files* Closed After 

Preliminary Review 

Files Closed After 

Investigation 

Conciliation Agreements Signed 

Files Closed Prior to 

Authorizing Civil 

Action 

Nonfilers 

Other 

Files Closed with 

Authorization of 

Civil Action 

Nonfilers 

Other 

Total Files Closed 

273 

35 

48 

0 

1 

36 

10 

403 

169 

97 

97 

64 

7 

16 

21 

471 

442 

132 

145 

64 

8 

52 

31 

874 

*A file may contain more than one MUR. 
22 

During 1978, the Office of General Counsel 

more than tripled its enforcement caseload. As 

indicated by Chart I above, the Office of General Counsel opened 481 enforcement cases in 

1978 as compared to 133 in 1977. As indicated 

by Chart II, the total number of enforcement 

cases processed in 1978 represented a significant 

increase over the total number of cases handled 

in the two and one-half preceding years. The 

Office of General Counsel closed 471 enforce· 

ment cases during 1978 alone, as compared to 

403 enforcement cases from June 1975 through 

December 1977. 

The Office of General Counsel also reached the 

final stages of conciliation or litigation in more 

enforcement cases during 1978 than it had in 

previous years. The 1978 election period 

accounted for approximately 70 percent of all 

the Commission's offensive litigation. A large 

portion of the remaining offensive litigation was 

filed in the second half of 1977.1 9 

Issues Addressed in Litigation 

When the Commission determined the political 

activities of individuals, organizations or political committees to be in direct violation of the 

Federal Election Campaign Act or FEC Regulations, the Commission brought suit in U.S. 

District Courts to enforce the Act. During the 

same period, the Commission was named as 

defendant in several suits challenging its enforcement powers and the constitutionality of 

the Act. Several suits raised substantive issues 

summarized below. 

FEC v. National Education Association, et al. 

In this suit, the Court agreed with the Commission that the use of a reverse checkoff method 

for soliciting political contributions violated 

the Act. T,he National Education Association 

(NEA) and 17 State affiliates made payroll 

deductions of its members to support NEA's 

political action committee, NEA-PAC. Deducted 

19 This figure excludes nonfiler litigation. 

automatically from the member's paycheck, 

along with membership dues, the payment to 

NEA-PAC was refundable upon written request. 

The Court ruled that the reverse checkoff 

procedure is per se illegal because it puts undue 

pressure on the member to make a contribution. 

The Commission's Regulations specifically state 

that political contributions may not be obtained 

as a "condition of acquiring or retaining...membership in a labor organization...even though 

they are refundable upon request of the payor." 

Furthermore, the Court ruled that the method 

violated that portion of the statute which states 

that an employee must be informed "at the time 

of such solicitation of his or her right to refuse 

to so contribute without any reprisal." 

FEC v. AFL-CIO 

In December 1977, the Commission filed suit 

against the AFL-CIO seeking to enjoin the 

organization from transferring funds from its 

COPE Education Fund to its separate segregated 

fund (a political committee). The Commission 

argued that the transfer violated the provisions 

in the Act prohibiting labor organizations from 

using general treasury monies to make contributions or expenditures in connection with Federal 

elections. 

In June 1978, the Court granted the Commission's motion for summary judgment in the case, 

concluding that transfers from the AF L-CIO 

COPE Education Fund to AF L-CIO's separate 

segregated fund were illegal. 

Court Dismisses Two Suits Challenging 

Constitutionality of the Act 

Two suits filed against the Federal Election 

Commission in 1978 challenged the constitutionality of §441b of the Act, which limits 

.solicitations by corporations (and their separate 

segregated funds (PACs)) for voluntary contributions to their PACs. The United States District Court for the District of Columbia dismissed both suits. 
23 

In Martin Tractor Company, et a/. v. Federal 

Election Commission, et al., filed on July 7, 

1978, three corporations and their affiliated 

PACs, three executives and one hourly employee 

of one of the corporations were the plaintiffs. 

They sought injunctive relief and a declaratory 

judgment that §441b of Title 2 is an unconstitutional violation of plaintiffs' rights under the 

First and Fifth Amendments of the United 

States Constitution. 

On July 20, 1978, the National Chamber Alliance for Politics, et al. filed suit against the 

Federal Election Commission, similarly challenging the constitutionality of the PAC solicitation 

provisions and asking for injunctive relief. 

Plaintiffs included the Chamber of Commerce (a 

nonprofit corporation), its separate segregated 

fund, three executives of the two organizations 

and one board member of the Chamber of 

Commerce. 

On November 18, the U.S. District Court for the 

District of Columbia granted the Commission's 

motion to dismiss the Martin Tractor suit. On 

November 22, the Court dismissed the National 

Chamber Alliance for Politics suit as well. In 

both orders, the Court said that the special 

provision of 2 U.S.C. §437h(a), expediting 

judicial review of constitutional issues, is inapplicable to the plaintiffs. (Section 437h(a) 

permits the Commission, the national committee 

of any political party or any individual eligible 

to vote to bring appropriate actions challenging 

the constitutionality of the Act.) The individual 

plaintiffs sue "not in their individual capacities 

as voters" but rather as representatives of 

corporate entities. 

Republican National Committee et al. v. FEC 

On June 16, 1978, the Republican National 

Committee (RNC) filed a suit against the Commission. The suit challenged the constitutionality of the provision of the Presidential Election 

Campaign Fund Act which requires that Presidential candidates who accept public funds for 

the general election must agree: a) not to make 

qualified campaign expenses in excess of the 

amount of public funds they receive; and b) not 

to accept private contributions to defray qualified campaign expenses, except to the extent 

necessary to make up any deficiency in public 

funds. The RNC argued, inter alia: 

1. The statutory scheme (described above) 

violates the First Amendment because it 

restricts the ability of candidates, their 

political parties, supporters and contributors 

to communicate their ideas. 

2. The statutory scheme unconstitutionally 

discriminates against challenging candidates 

because incumbent Presidents have the 

advantage of free publicity and significant 

resources attached to, the executive branch 

(e.g., speechwriters, jet planes, etc.). 

3. The statutory scheme discriminates against 

candidates not politically allied with labor 

organizations since, under 2 U.S.C. § 441 b, 

labor organizations may spend unlimited 

funds to communicate with their members on 

political matters and only labor organizations 

are allegedly in a position to expend such 

large sums for communication with voters. 

The Federal Election Commission filed a motion 

to dismiss the suit, arguing that: 

1. Plaintiffs' constitutional objections had been 

rejected by the Supreme Court in Buckley v. 

Valeo; 

2. Plaintiffs' description of how the Act would 

impact on the 1980 Presidential campaign is 

speculative and does not present a "ripe" 

controversy; and 

3. The suit presents political questions not 

subject to judicial resolution. 

The Court denied without prejudice the Commission's motion to dismiss on November 30, 

1978, and convened a three-judge district court 

to hear the case. It also denied the motion of 

Common Cause et al. to intervene, but permitted them to file briefs amicus curiae. 
24 

Cooperating With Other 

Federal Agencies 

Cooperating with other Federal agencies, the 

FEC worked to streamline compliance procedures and resolve conflicts in jurisdiction during 

1978. These efforts facilitated the FEC's role in 

administering the Federal election law and 

clarified statutory requirements of candidates 

and committees. Three such cooperative efforts 

are detailed below. 

FEC and Federal Communications Commission 

Issue a Joint Notice on Political Broadcast 

Communications 

To simplify required notices used in broadcast 

communications, the Federal Election Commission and the Federal Communications Commission (FCC) issued a Joint Public Notice in 

August 1978. The joint statement provided 

examples of notices which could be used by 

broadcast licensees and persons purchasing 

political broadcast time to satisfy both FCC and 

FEC requirements. Specifically, the notices 

could be used to comply with the FEC requirements for authorization (or nonauthorization) 

notices and FCC rules concerning sponsorship 

identification. 

FEC and Justice Department Issue 

Enforcement Agreement 

In February 1978, the FEC and U.S. Department of Justice established the general principles 

by which the Federal Election Campaign Act 

would be enforced by the two agencies.20 

Under the agreement, the Justice Department 

would handle the final disposition of all cases in 

which there is a "knowing and willful, significant and substantial" violation of the Act. The 

Federal Election Commission would investigate 

and dispose of all alleged violations of the Act 

that do not involve "significant and substantial" 

violations committed "knowingly and willfully." 

Upon determining "probable cause" that a 

violation is sufficiently substantial in nature and 

has been committed "knowingly and willfully," 

the Commission would refer the case to the 

Justice Department for possible prosecution. If 

either one of the two standards were not present, the Commission would retain jurisdiction 

over the case. 

In cases where the Justice Department retained 

final authority, the Department agreed to 

"apprise the Commission of information" 

concerning those cases "at the earliest opportunity." The Commission would not, however, 

be privy to evidence developed during the course 

of a grand jury proceeding. 

FEC and Federal Aviation Administration Find 

Solution to In-Kind Contribution 

On September 26, 1978, the Federal Aviation 

Administration (FAA) changed its Regulations 

to permit private aircraft owners and other 

noncommercial operators to accept payment for 

transporting candidates for Federal office. The 

FAA's action was prompted by the Federal 

Election Campaign Act and Commission Regulations which require Federal candidates to pay 

in advance for private air transportation (provided by a corporate or noncorporate owner) if 

they wish to avoid receiving a contribution inkind from the aircraft owner.21 The election 

law had conflicted with FAA rules which 

generally prohibit the receipt of payments by 

any operator who does not have an air taxi or 

similar commercial certificate. To facilitate 

operators' compliance with both FAA and FEC 

Regulations, the FAA action allowed the private 

aircraft owner to carry a candidate and accept 

compensation without first becoming a commercial operator. 

20 See Federal Register, 43 FR 5441. 21 See 11 CFR 114.9(e). 
25 Chapter 5 

Planning for the 1980 

Presidential Election Cycle 

The 1976 elections marked the first time in 

United States politics that a program of direct 

public funding was implemented for Presidential 

elections. Funded through the dollar checkoff 

on income tax forms, the Presidential Election 

Campaign Fund provides three separate accounts 

for the public funding of the three different 

phases of Presidential campaigns. They are: the 

Presidential primary matching account, the 

Presidential nominating convention payment 

account and the Presidential general election 

account. 

Commission meets in open 

session to consider Regulations for Presidential elections. 

During the 1976 Presidential election period, the 

Commission's public financing program concentrated on determining the eligibility of Presidential candidates for public financing, verifying 

matchable contributions in Presidential primaries and certifying public funds. As the 

program wound down in 1977, the Commission 

made final certifications of primary matching 

funds, conducted audits and required subsequent repayments of unused public funds by 

Presidential campaign committees to the United 

States Treasury. 
26 

In reassessing the public financing program, the 

Commission considered ways of improving 

procedural deficiencies made apparent during 

the implementation of the 1976 public financing 

program. Hearings were held on the public 

financing regulations, and new reporting forms 

for Presidential candidates were approved. As 

1978 drew to a close, this reassessment process 

culminated in a staff proposal for a Master Plan 

for Administering the 1980 Presidential Election. These three areas of reassessment are 

described in more detail below. 

Hearings Held on 

Public Financing Regulations 

In June 1978, the Commission held public 

hearings on suggested revisions of FEC procedures and Regulations governing the public 

financing of Presidential elections. How could 

the Regulations be amended to reflect the 

practical political situations encountered during 

the 1976 Presidential cycle? In seeking responses 

to this query, the Commission was especially 

interested in the views of 1976 Presidential 

election participants. They were asked to 

comment on: 

-- Any administrative burdens imposed by the 

current Regulations; 

-- Any problems experienced with the recordkeeping requirements of the Regulations; and 

-- Any areas of the Act or Regulations in need 

of further clarification. 

With FEC Chairman Joan Aikens presiding, the 

Commissioners heard testimony from seven 

witnesses, including representatives of 1976 

Presidential campaigns and a national party 

committee which received public funds, as 

well as other interested persons. Comments 

ranged from detailed suggestions for bookkeeping requirements to policy recommendations on 

party activities related to Presidential campaigns 

receiving public funds. 

Many of the suggestions and comments received 

were incorporated into draft revisions of the 

Regulations which were pending before the 

Commission at the end of the year. 

New Guidelines and Forms 

for Reporting Activity 

The Commission'S analysis of campaign finance 

reports filed by both Presidential and nonPresidential candidates and committees during 

1976 revealed reporting problems. For example, 

campaign expenditures were not itemized in 

sufficient detail. Detailed itemization of expenditures is particularly important in Presidential 

campaign finance reports since Presidential 

candidates are publicly accountable for how 

they use funds provided from the U.S. Treasury. 

The Commission's reassessment of 1976 reporting procedures precipitated such questions as: 

What constitutes an adequate disclosure of the 

"particulars" of campaign expenditures? How 

should credit card expenditures be reported? 

Must a Presidential campaign submit the occupation and principal place of business for persons 

contributing more than a combined total of 

$100 to all the candidate's committees, but less 

than $100 to each one? 

To ensure that the disclosure requirements of 

the Act are met by complete, accurate reporting 

of campaign contributions and expenditures, the 

Commission took several measures: 

-- It approved a new packet of reporting forms 

(FEC Form 3P and schedules) for Presidential 

candidates. The Presidential reporting forms 

will facilitate the monitoring of expenditure 

limitations for nominees or candidates who 

accept public funding.22 Additionally, Sched22 Eligible Presidential primary candidates may receive public 

funds to match small contributions of up to $250 from 

individual contributors. To be eligible for matching payments, a candidate must first raise funds exceeding $5,000 in 

each of 20 States, consisting of contributions from individuals of $250 or less. The candidate must also agree to limit 

expenditures for all primaries to $10 million (plus a cost-of-
27 

ule G-P requires the disclosure of the "ultimate payee" of campaign "advances" expended by campaign workers. 

-- It directed staff to draft new regulations on 

the disclosure of "particulars" of expenditures by Presidential candidates and committees. The regulations would track the guidelines on "particulars" of expenditures for 

non-Presidential candidates and committees 

which the FEC adopted in August 1978. (For 

a description of these non-Presidential guidelines, see Chapter 3, page 20.) 

-- The Commission also undertook the preparation of a systems manual for Presidential 

candidates eligible for primary matching 

funds. The manual will provide guidelines for 

establishing a computer-based accounting 

system, budgeting processes, mailing list 

operations and management reporting procedures for committee officials. The systems 

manual will incorporate the most effective 

systems and controls used by candidates who 

received public funds in 1976. 

Master Plan for the 1980 

Presidential Election 

For purposes of the Federal Election Campaign 

Act, the 1980 Presidential election cycle commences in January 1979. At that time, Presidential candidates may begin raising funds that will 

qualify them for matching fund certification. 

During 1978, the Commission's Presidential 

Task Force formulated a Master Plan for effective administration of the 1980 election cycle. 

The three-pronged Plan covered the public 

funding of the Presidential primary elections, 

the Presidential nominating conventions and the 

living adjustment and exemptions for fundraising and certain 

legal and accounting expenses). In the general election, each 

major partY Presidential nominee becomes eligible for a 

public grant of $20 million. If candidates accept public 

funding, they must limit expenditures to that amount (plus 

cost-of-living adjustment and certain exemptions) and may 

not accept private contributions. Minor or new party candidates may qualify retroactively for public funds. 

Presidential general election. It spelled out 

procedures for handling submissions for certifications, problems uncovered during review of 

disclosure reports, and audit issues and reports. 

Under the Master Plan, the Commission would 

establish a "Presidential Team," responsible for 

coordinating the Commission's public financing 

activities. In addition, the Presidential Team 

would oversee FEC Presidential units assigned to 

work with each Presidential campaign on a 

day-to-day basis. Each unit would have primary 

responsibility for coordinating FEC activity 

related to one particular campaign. The Presidential units would also assist the campaigns 

with bookkeeping and reporting procedures. 

The unit's staff of experts would be readily 

accessible for a quick and informed resolution of 

problems the campaign committee might encounter. 
28 

Clearinghouse studies are available to the public in its 

Document Center. 
Chapter 6 29 

Clearinghouse for 

Election Administration 

Recognizing a need for the systematic collection 

and sharing of election administration information, Congress in 1971 created a National 

Clearinghouse for Information on the Administration of Elections within the General Accounting Office. The unit was transferred to the 

Federal Election Commission by 2 U.S.C. 

§439(b) of the Federal Election Campaign Act 

Amendments of 1974. This section of the Act 

directs the Commission to serve as a clearinghouse for information with respect to the 

administration of elections and to conduct 

independent contract studies of the administration of elections. Studies are to include, but are 

not limited to: methods of selecting and the 

responsibilities of election board officials, 

personnel practices relating to the registration of 

voters, as well as voting and vote-counting 

methods. Finally, the statute provides that the 

research products issuing from these efforts be 

made available to the general public at cost. 

Clearinghouse 

Research Program 

Clearinghouse resources are devoted largely to 

research projects on topics of special concern to 

election officials and which are beyond the 

scope or capacity of any one State or local 

jurisdiction. Such research efforts take one of 

two forms: Contract research projects or inhouse staff research projects. 

Contract Research 

The contract research effort constitutes the 

largest single item in the Clearinghouse budget. 

Research topics and specifications are selected 

in conjunction with the Clearinghouse Advisory 

Panel and typically fo_cus on one of the election 

functions or a troublesome aspect of them. A 

normal research contract requires a review of the 

literature and history on the topic, a review and 

documentation of relevant State and Federal 

laws, a survey of relevant current practices 

around the nation, and a set of recommendations or models appropriate to the varied needs 

and resources available in State and local jurisdictions. Each project normally issues more than 

one report so that the pertinent information 

can be directed to the particular audience (State 

officials, local administrators or State legislators) 

for whom it is intended. 

As an additional measure to ensure the utility 

and readability of the final reports, each contractor is required to establish an advisory 

board of five to eight election officials or area 

experts. This board serves as both a resource for 

and a reviewer of the contractor's work. (For a 

detailed description of research contracts ongoing, completed and underway, see Appendix 

8.) 

Staff Research 

Internal staff research projects absorb a significant portion of Clearinghouse staff time. These 

projects range in depth and intensity from those 

of rapid information retrieval using the Documents Center (described below) to research 

projects requiring several weeks' analysis. 

Projects of this type are undertaken in response 

to requests from State or local election officials 

or legislators; Members of Congress or their 

staff; representatives of foreign governments; or 

other divisions within the Commission itself. 

Research Reports 

Clearinghouse research reports are provided free 

of charge to Federal, State and local government 

officials. Members of the general public may 

purchase copies from the Department of Commerce, National Technical Information Service. 

(See Appendix 8 for a complete listing of 

Clearinghouse reports.) 

Clearinghouse 

Information Program 

In addition to its research efforts, the Clearinghouse plays an active role in collecting and 

disseminating information about the election 

process. 
30 

Clearinghouse Documents Center 

The central physical feature of the Clearinghouse is its Documents Center which is rapidly 

becoming the largest national resource for 

information about election administration and 

procedures. In addition to housing general and 

historical works, the Documents Center maintains statistical summaries of voter registration, 

voter turnout and election returns for Federal 

offices; State and Federal election laws, hearings 

and case law; State and local forms, sample 

ballots and procedures; and other reports, theses 

and analyses relevant to election administration. 

The Documents Center serves as the principal 

resource for staff research projects and is available to election administrators, legislators and 

members of the general public. 

FEC Journal of Election Administration 

The Clearinghouse's primary means of communication with election administrators around the 

country is the FEC Journal of Election Administration, published quarterly. 

The Journal is designed to provide a forum for 

national discussion of problems in election 

management and, as such, publishes articles 

submitted by Federal, State and local electionrelated officials. The Journal also keeps readers 

informed of Clearinghouse activities, services 

and reports. The Journal is currently distributed 

to approximately 10,000 State and local election officials and legislators whose addresses are 

categorized and maintained in the FEC computer system. 

Clearinghouse 

Assistance Program 

Consonant with its mission of serving as a 

clearinghouse of information on election administration, the Clearinghouse staff responds to a 

variety of requests for personal appearances and 

assistance. In addition to accepting speaking 

engagements at national and State organizations 

and associations, the Clearinghouse has provided 

specific assistance to State legislatures, legislative 

committees and State commissions which 

contemplate changing their election administration laws and procedures. At the same time, the 

Clearinghouse frequently serves as a general 

information service by directing State and local 

officials to the Federal agency or official concerned with their particular problem. 

Clearinghouse Seminars 

The Clearinghouse staff will also be sponsoring a 

series of five regional workshops on Election 

Administration during 1979. The workshops will 

provide useful information to State and local 

election officials in such areas of election 

administration as: absentee registration and 

voting; planning, managing and budgeting 

election offices; statewide voter registration; 

voting equipment; and training and redistricting. 

Clearinghouse Advisory Panel 

To help ensure that the activities and research 

projects of the National Clearinghouse are 

consistent with the needs and priorities of 

election officials around the country, the 

Commission approved in 1976 the formation 

of a Clearinghouse Advisory Panel. 

The Advisory Panel is composed of 20 State 

election officials, local election administrators, 

and State legislators appointed for two-year 

terms. Ten appointments are made each year. 

The three-tier, bipartisan character of the Panel 

provides a wide-ranging view of election administration and offers the first national forum of 

its kind for discussion of problems in planning 

and managing elections. 

The Panel meets twice annually to review the 

current problems and priorities in election 

administration, to review Clearinghouse research 

projects and services and to make recommendations to the Commission for future projects and 

activities. It also serves as a liaison between the 

Clearinghouse and other Federal, State and local 

agencies. During 1978, the Panel met on January 

9-10 and again on August 14-15. 
31 Chapter 7 

The Commission's 

Organization and 

Management 

Organization 

The Federal Election Commission, created by 

the Federal Election Campaign Act (the Act), is 

composed of six Presidentially appointed 

Commissioners and two ex-officio nonvoting 

members, the Secretary of the Senate and 

the Clerk of the House of Representatives. In 

addition, the law provides for two statutory 

officers appointed by the Commission: the Staff 

Director and the General Counsel. By statute the 

Staff Director appoints and sets the pay of 

subordinate staff, with the approval of the 

Commission. 

During 1978, the various subdivisions of the 

Commission were organized as follows: 

1. Commissioners and their immediate staff 

2. Staff Director's Office (including Office of 

Planning and Management and Commission 

Secretary's Office) 

-- Administration 

-- Audit 

-- Data Systems Development 

-- Information 

-- Public Disclosure 

-- Reports Analysis 

3. Office of General Counsel 

-- Litigation and Enforcement 

-- Regulations and Legislation 

-- Advisory Opinions and Policy 

As of December 31, 1978, Commission staff 

totaled 223 permanent employees and 32 

temporary employees. 

The Commissioners 

The Commissioners are responsible for overseeing the Federal Election Campaign Act 

codified in Titles 2 and 26 of the U.S. Code. 

More specifically, the Commissioners administer 

the Act's provisions, seek to obtain compliance 

with its requirements, and formulate policy with 

regard to its implementation. All decisions must 

be made by a majority vote of the members; 

four affirmative votes are required to approve 

Regulations, render advisory opinions and take 

certain actions in connection with enforcement.23 

Joan D. Aikens, former Vice Chairman of the 

Commission, was unanjmously elected Chairman 

by her fellow Commissioners on May 12, 1978; 

Robert 0. Tiernan was unanimously elected 

Vice Chairman. Both assumed office on May 21, 

1978. From May 1977 to May 1978, Commissioner Thomas E. Harris had served as Chairman 

of the Commission. By statute, any Commissioner is limited to a single, one-year term as 

Chairman. The Chairman and the Vice Chairman 

must be affiliated with different political parties. 

Both the Secretary of the Senate and the Clerk 

of the House are represented at the Commission 

by Special Deputies who maintain offices at the 

Commission and who are nonvoting participants 

in all Commission meetings and operations. 

On October 25, 1978, John McGarry was sworn 

in as a new Commissioner ofthe FEC, replacing 

Neil Staebler, whose term had expired on April 

30, 1977. Mr. Staebler had continued to serve 

on the Commission pending the swearing-in 

of a successor. President Carter appointed 

Commissioner McGarry under the "recess 

appointment" clause of the U.S. Constitution 

(Article II, §2). 

Generally meeting twice a week during 1978 

(once in open session and once in closed session), the Commissioners considered an increasing number of compliance cases; defined audit 

policies and procedures; held repayment hearings regarding the return of Federal matching 

funds by a Presidential candidate to the U.S. 

Treasury; held hearings on suggested revisions to 

Commission procedures and Regulations governing public financing of Presidential elections; 

and considered procedures for administering the 

Presidential Election Campaign Fund during the 

1980 Presidential election cycle. Other activities 

included approval of the FEC's Freedom of 

Information Act Regulations and guidelines for 

23 See 2 U.S.C. §437(c). 
32 

disclosure of particulars of expenditures by 

non-Presidential candidates and committees; and 

the rendering of an increasing number of advisory opinions. With the Federal Communications Commission (FCC), the FEC also issued a 

joint public notice detailing examples of notices 

which may be used in broadcast communications to comply with both FCC and FEC requirements. 

Office of the Staff Director 

The Staff Director is the executive officer 

responsible for staff appointments and organization and, together with the General Counsel, 

for the implementation of Commission policy 

through a variety of programs. The Deputy Staff 

Director reports directly to the Staff Director. 

He has broad responsibility for assisting in the 

supervision of all phases of Commission activity, 

particularly planning and procedural development. 

Reports Analysis Division Created. In January 

1978, the Reports Analysis Division was established to give the Commission greater capabilities in monitoring and enforcing the disclosure 

requirements of the Act, particularly through a 

more comprehensive analysis of reports, a 

systematic application of nonfiling procedures 

and a more structured approach to pre-campi iance notifications. Reporting to the Office of 

the Staff Director, the division is divided into 

House, Senate, Presidential, Party and Multicandidate committee branches. (For more information concerning the functions of this division, 

see Chapter 1, pages 3, 5-7, and Chapter 3, pages 

17-19.) 

A document center containing all original 

reports filed with the FEC and a Coordinator of 

State Disclosure support the Reports Analysis 

Division in its operations. (See Chapter 3, page 

18 for a full description of the Coordinator of 

State Disclosure's functions.) 

Office of General Counsel 

The General Counsel directs the enforcement 

activities of the Commission and represents the 

Commission in all enforcement matters and 

litigation. The Office of General Counsel is also 

responsible for drafting regulations and advisory 

opinions for the Commission's consideration, 

and for advising the Commission on any legal 

matter which comes before it. 

The Associate General Counsel is responsible for 

coordinating legal policy of the Office and serves 

as Acting General Counsel in the Counsel's 

absence. 

Management and Budget 

The Office of Planning and Management 

The Office of Planning and Management completed its second year of operations in 1978. 

Reporting directly to the Staff Director, the 

Office worked in conjunction with the Budget 

Task Force to prepare the Commission's budget 

and evaluate the Commission's programs as to 

their consistency with agency objectives. Additionally, the Office of Planning and Management 

reviewed all FEC reporting forms, manuals and 

recordkeeping systems, and helped revise the 

budget process described below. 

In Fiscal Year 1979, the Office plans to computerize the Commission's Management Information System. In addition, the Office will 

develop and implement internal review procedures for Commission programs. 

The Budget 

The Commission uses zero-based budgeting 

principles in determining budget outlays to FEC 

programs. Under this system, the managers of 

Commission divisions and offices identify 

program objectives designed to achieve one or 

more of the Commission's four major objectives: 

1, Administer public funding of Presidential 

candidates; 

2. Obtain compliance with the Act; 

3. Facilitate public disclosure of information on 

campaign finance activities of candidates and 

committees; and 

4. Serve as a Clearinghouse for Election Administration Information. 
25 

20 

15 

Commissioners Staff Office of Admin­ Audit Clearing­ Data Information Public Reports 

Director General istration* house Systems Disclosure Analysis 

Counsel Development 

FY'79 • Administration's budget includes 

Approved rents, supplies, reproduction - services, etc., for the entire 

,___ _, Proposed Commission. .----.~ FY '80 

33 

Each manager prepares program packages for 

three levels of activity (minimum, current and 

expanded) in each program area. The Budget 

Task Force, chaired by a Commissioner, then 

makes its budget recommendations after evaluat· 

ing the alternative program packages submitted 

by managers. 

The Office of Planning and Management reviews 

the submissions for adherence to zero-based 

budgeting principles and for correctness of 

calculations. The program packages are then 

evaluated in terms of their ability to achieve the 

Commission's four major objectives. An overall 

Budget Allocation 

(Figures are percents of Total Budget) 

management plan is then drawn up encompass· 

ing all FEC activities. As the fiscal year progresses, the Management Information System, a 

work reporting system, measures the progress of 

each division or office in achieving the objectives 

of the management plan. 

This planning and budgeting system helps 

monitor budget outlay program results. It also 

provides more accurate data for future budget 

planning. Each month, managers report staff 

costs allocated among ongoing programs. Planning and Management reports this information 

to the Commission each month along with 

program output reports. 
34 

In Fiscal Year 1978, the Commission received an 

annual budget appropriation of $7,300,000 plus 

a supplemental appropriation of $310,000 to 

compensate for the October 1977 cost-of-living 

increase. These monies were expended during 

the fiscal year as follows: 

Commission and staff salaries, 

including benefits $4,680,436 

Consultants 0 

Travel 205,462 

Transportation & Motor Pool 15,509 

Commercial Space 778 

Equipment Rental 170,952 

Printing 159,180 

Contracts 1,485,660 

Administrative Expenses 148,103 

Supplies 110,556 

Library Materials 19,684 

Telephone 152,258 

Postage 24,064 

Space Rental 254,182 

Equipment Purchases 173,176 

TOTAL $7,600,000 

For Fiscal Year 1979, the Commission received 

an annual appropriation of $8,000,000. Expenditure of these funds is budgeted as follows: 

Commission and staff salaries, 

including benefits $5,318,884 

Consultants 10,000 

Travel 324,918 

Transportation & Motor Pool 15,506 

Commercial Space 0 

Equipment Rental 191,850 

Printing 220,916 

Contracts 993,244 

Administrative Expenses 150,230 

Supplies 96,098 

Library Materials 22,000 

Telephone 148,600 

Postage 57,000 

Space Rental 376,956 

Equipment Purchases 73,798 

TOTAL $8,000,000 

An appropriation of $1 0,697,000 has been 

requested for Fiscal Year 1980. 

The graph on page 33 compares the budget allocation of resources among FEC divisions for 

Fiscal Years 1979 (approved) and 1980 (proposed). 

Computer Support - Data Systems 

Development Division 

The Data Systems Development Division, in 

conjunction with the Administration Division, 

computerized the Commission's payroll, inventory and personnel information operations 

during 1978. When work is completed on its 

computer-based budget and accounting systems 

in 1979, the Commission will take over the final 

administrative support functions now provided 

by the General Services Administration. 

All Commission divisions increased their use of 

computer support services in 1978. In providing 

computer support, the Data Systems Development Division (DSDD) produced approximately 

38,000 standard indices of campaign finance 

information in 1978, and 1,700 other indices. 

DSDD also developed new computer programs 

for categorizing campaign finance information, 

which enhanced the Commission's ability to 

disclose campaign finance activity and to monitor compliance with the Act. (See Chapter 1, 

pages 5-7, and Chapter 3, pages 17-19.) 

With the impending expiration of its current 

contract for data processing services in 1979, 

DSDD undertook an open and competitive 

procurement. This process offered an opportunity to inspect the range of services and new 

techniques available in the computer field to 

support Commission programs. DSDD staff 

completed a document for soliciting contract 

proposals, which was approved by the General 

Services Administration and released to data 

processing vendors. Evaluation, award of the 

contract and installation of the new system will 

occur in 1979. 
35 

FEC staff uses computer system to review campaign 

finance reports filed by candidates and political committees. 

Personnel 

Labor-Management Relations. In November 

1977, the National Treasury Employees Union 

(NTEU) filed a petition with the U.S. Department of Labor seeking an election among all 

professional and nonprofessional employees of 

the Federal Election Commission to determine if 

the employees wished to be represented by that 

union. A hearing was held on the matter in late 

January and February by the Department of 

Labor to examine questions raised by the 

Commission as to whether such Union representation would constitute a conflict of interest 

for the employees involved and also as to 

whether professional employees should be 

included in the bargaining unit. After an extension of time to allow for the cross filing of briefs 

by the parties, the Assistant Secretary of LaborManagement Relations handed down a decision 

on July 11, 1978, directing that the election be 

held within 60 days, and that professional 

employees be given an opportunity to vote for 

their inclusion in the bargaining unit. Excluded 

from the voting group were management officials and supervisors, confidential employees and 

employees engaged in personnel work. 

On September 7, 1978, a majority of eligible 

Commission employees voted to make NTEU 

their exclusive bargaining representatives. By a 

preliminary vote, a majority of the professional 

employees voted to be included in the same unit 

with nonprofessional and temporary employees 

of the Commission. The Commission began 

preparing for pending contract negotiations with 

NTEU in the fall of 1978, and in December 

negotiating teams from the FEC and the Union 

met to establish ground rules for the negotiations. 
36 

Orientation and Training for Employees. The 

Commission conducts a regular orientation 

program for new employees which highlights the 

interdependence among the subdivisions of the 

Commission. The program helps establish 

channels of communication for employees 

within Commission divisions. 

By using the professional training programs of 

other agencies, the Commission provided selected employees with specialized training which 

the FEC could not duplicate. The Commission is 

currently establishing an in-house training 

program for first-line supervisors. 

EEO Program. From July 1977 to July 1978, 

approximately $30,000 was spent on the Commission's Equal Employment Opportunity Program. The Commission's EEO staff consisted of 

a Director of Equal Employment Opportunity, 

who devoted approximately 40 percent of his 

time to EEO work, a Federal Women's Program 

Coordinator and two EEO Counselors, who 

devoted approximately 20 percent of their time 

to EEO activities while continuing their other 

regular duties. 

To implement the Commission's Equal Employment Opportunity Plan, EEO staff continued recruiting activities aimed at filling job 

vacancies with minority group members. EEO 

staff also attended several privately sponsored 

affirmative action job conferences. 

During the year, the Commission's Federal 

Women's Program sponsored a series of seminars 

on subjects of importance to women in Federal 

employment, such as access to credit and 

assertivensss training. Career counseling services 

were also available. 

The EEO staff processed four discrimination 

complaints during the year. Of these, three were 

resolved at the informal stage and one reached 

the formal stage. The formal complaint was 

withdrawn during the year. 
Chapter 8 

Legislative 

Recommendations 

In 1976 Congress enacted the fourth major 

overhaul of campaign financing laws in slightly 

over four years. During implementation of the 

1976 Act, the Federal Election Commission 

kept a continually updated list of apparent 

statutory omissions, inadequacies and other 

problems. This list served as the basis for the 

Commission's legislative recommendations in 

its 1976 Annual Report, submitted in March 

1977. Several additional recommendations were 

made in the 1977 Annual Report, submitted in 

March 1978. 

The Commission reiterates its support for its 

1976 and 1977 recommendations and includes 

additional recommendations in this Annual 

Report. These recommendations seek to bring to 

Congress' attention provisions of the Act which 

merit revision. 

The Commission has categorized these recommendations into seven separate areas: Simplification; Presidential Elections; Limitations and 

the Role of the Political Party; Commission 

Duties, Powers and Authority; Clarification; 

Corporate and Union Activity and Miscellaneous. 

Simplification 

The Commission strongly believes that a simple, 

workable system of campaign financing regulations is achievable. Almost one-half of the 

Commission's recommendations seek to meet 

this goal. The 1974 Amendments attempted to 

reduce the number of reports required to be 

filed, but in 1976 and 1978 many candidates 

and committees actually were required to file 

more reports than previously. Implementation 

of the following recommendations dealing with 

reporting would dramaticaUy reduce the number 

of reports required to be filed. Streamlining of 

the disclosure provisions of the Act will simplify 

reporting and maintain a high level of public 

disclosure. 

Principal Campaign Committee Reporting 

The Act requires each candidate to designate a 

principal campaign committee which must file 

reports. Since the candidate has a separate 

reporting obligation many campaigns file two 

sets of reports. The Commission recommends 

that candidates should be given two options: 

either (a) file all reports of receipts and expenditures on a candidate's report and have no 

committee or (b) designate a principal campaign 

committee which would compile and file all 

reports. This change often would reduce by 

one-half the number of reports required for 

some campaigns. 

Presidential Candidates 

Presidential candidates operating in two or more 

states should be required to file monthly in an 

election year and quarterly in a nonelection 

year, as is the case under current law. For all 

candidates and committees, the 1 0-day preelection report should be changed to a 12-day 

preelection report. For a Tuesday election, the 

tenth day before an election is a Saturday 

and reports received usually are not processed 

and microfilmed unt~l Monday. A 12-day 

preelection report would be due on Thursday 

and would substantially increase the period 

during which these reports are publicly available 

prior to the election. (Note: appropriate adjustments will be needed in the 48-hour reporting 

requirements if this recommendation is 

adopted.) 

Congressional Candidates 

During nonelection years, all Congressional 

candidates and committees should file only two 

reports, in July and at the end of the year. There 

should be no do11ar threshold for fit ing these 

reports. Candidates and committees involved in 

special elections would file 12-day preelection 

reports and a 30-day post special general election report. 

In election years, Congressional candidates and 

committees should file 12-day preelection 

reports, a 30-day post general election report 
38 

Reporting 

Number of 

Reports 

Required 

Two-Year 

Cycle Election Year Nonelection Year 

A. Current Law 

Presidential Candidates 

Candidates' Principal 

Campaign Committees 

(PCC) 

Multicandidate Committees 

16 

24 

12-24 

Monthly reports. 

Quarterly (if receipts 

or expenditures are 

over $1,000), 10-day 

pre-election and 30-day 

post-election (primary 

and general); year-end. 

Choice of: Quarterly 

(if over $1 ,000), 1 0-day 

pre-election and 30-day 

post-election (all primaries and general), 

year-end; or monthly. 

Same. 

Quarterly (if over 

$5,000); year end. 

Choice of: Quarterly (if receipts or 

expenditures exceed 

$1 ,000), plus preand post-election 

reports if special 

election involvement, or monthly. 

B. Recommendations 

Presidential Candidates 

Candidates and PCCs 

together 

Qualified Multicandidate 

Committees and National 

Party Committees 

Other Nonparty Committees, Independent Expenditures Filers, State and Local 

Party Committees 

16 

9 

14-24 

9 

Monthly reports. 

April 10, July 10, 

October 10, 12-day 

pre-election (primary 

and general), 30-day 

post-general election, 

and year-end reports. 

Monthly reports. 

April 10, July 10, 

October 10, plus 

12-day pre-election 

(primary and general), 

30-day post-general, 

and year-end reports. 

Quarterly reports. 

July and year-end 

reports. 

Choice of: monthly; 

or July and year-end 

report (plus pre- and 

post-election reports 

if involved in special 

elections). 

July and year-end. 
39 

and quarterly reports in April, July, October and 

year-end. This reporting scheme would be keyed 

to the election cycle. 

If the principal campaign committee reporting 

recommendation suggested above is also adopted, the maximum number of reports would be 

reduced from 24 to nine for Congressional 

candidates. 

Qualified Multicandidate Committees 

and National Party Committees 

Qualified multicandidate committees and 

national party committees should be required to 

file monthly in an election year and during 

nonelection years should have the choice of 

either filing monthly or filing in July and 

year-end (plus pre- and post-election reports if 

involved in special elections). 

Other Filers 

Other nonparty committees, independent expenditure filers and State and local party committees should file July and year-end reports in a 

nonelection year and during an election year file 

quarterly, year-end plus 12-day pre- and 30-day 

post-general election reports. 

Candidate Support Statements 

(2 u.s.c. §433(b)(9)) 

The Act imposes a burdensome requirement on 

multicandidate committees to report on their 

registration statements the names and offices of 

all the candidates they support. Any change in 

this information must be reported by amendment within 10 days. Some multicandidate 

committees are required, under this provision, to 

file amendments almost every 10 days. On 

occasion, the volume of these reports is so great 

that public disclosure is impaired. Most importantly, the identical information is contained on 

the reports of receipts and expenditures of each 

multicandidate committee. This provision 

should be repealed. 

48-Hour Reports (2 U.S.C. §434(a)) 

The requirement that any contribution of 

$1,000 or more received after the 15th day but 

more than 48 hours before any election be 

reported within 48 hours should be eliminated. 

In lieu thereof, the Act should require political 

committees to report within 48 hours any 

contribution of $1,000 or more made by that 

committee to a candidate in the 15 days preceding an election. Transferring this reporting 

duty to the donor committee would greatly 

expedite the disclosure of large contributions 

prior to the election. 

Registration Statements (2 U.S.C. §433(b)) 

The law requires political committees to supply 

information on their Statements of Organization 

which is not integral to the central goals of the 

Act. The following provisions do not add 

sufficient information to the concept of disclosure to warrant retention and should be repealed: 

-- The requirement that "the area, scope or 

jurisdiction of the committee" be listed. 

-- The requirement that the Statement of 

Organization contain "a statement whether 

the committee is a continuing one." 

-- The requirement that committees state "the 

disposition of residual funds which will be 

made in the event of dissolution." 

-- The provision requiring a "statement of the 

reports required to be filed by the committee 

with State or local officers, and, if so the 

names, addresses and positions of such persons." 

Election Period Limitations (2 U.S.C. §441a(a)) 

The contribution limitations are structured on a 

"per-election" basis, thus necessitating dual 

bookkeeping or the adoption of some other 

method to distinguish between primary and 

general election contributions. The Act could be 

simplified by changing the contribution limitations from a "per-election" basis to an "annual" 

or "election cycle" basis. There is precedent in 

the current Act for such an approach in 

§441a(h). If an annual limitation is chosen, 

contributions made to a candidate in a year 

other than the calendar year in which the 

election is held should be considered to be made 
40 

during the election year. Thus, under present 

limits multicandidate committees could give up 

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

to $2,000 at any point during the election cycle. 

Special elections should be treated as a separate 

"election cycle." Furthermore, since the present 

limitations were established in 1974, Congress 

should revise these figures in light of the substantial change in the Consumer Price Index 

since that time. 

State Filing (2 U.S.C. §439) 

The Act presently requires all candidates and 

committees to file a copy of each statement 

filed with the Commission with the Secretary of 

State or other equivalent State officer. It also 

imposes certain responsibilities on the Secretaries of State or equivalent officers. The appropriate State officials should be required to keep 

reports for only three years for House, five years 

for President and seven years for Senate, instead 

of the present five and 1 0-year requirements. 

The Secretaries of State have expressed more 

opposition to the report preservation feature of 

their filing responsibilities than any other. To 

further reduce the burdens placed on State 

officials, multicandidate committee reports 

should be filed only with the Secretary of State 

or other appropriate State agency in the State in 

which the committee is headquartered. State 

officials also have requested that they be reimbursed by the Federal government for costs 

incurred in receiving, indexing and maintaining 

these reports. 

Point of Entry (2 U.S.C. §438(d)) 

The Commission recommends that it be the sole 

point of entry for all disclosure documents filed 

by Federal candidates and committees supporting those candidates. A single point of entry 

would eliminate confusion about where candidates and committees must file their reports, 

direct their correspondence and ask questions. 

At present, conflicts arise when more than one 

office sends out materials, makes requests for 

additional information and answers questions 

relating to the interpretation of the law. A single 

point of entry would also reduce the governmental costs now associated with the operation 

of three different offices. Finally, separate 

points of entry make it difficult for the Commission to track nonfilers and responses to 

compliance notices. Many responses and/or 

amendments may not be received by the Commission in a timely manner, even though they 

were sent by the candidate or committee. The 

delay in transmittal between two offices sometimes leads the Commission to believe that 

candidates and committees are not in compliance. A single point of entry would eliminate 

this confusion. 

Written Pledges (2 U.S.C. §431 {e){2)) 

Candidates and committees are required to 

report all written pledges even if there is no 

hope of collecting the money. This is mandated 

by the definition of contribution which includes 

"a written contract, promise, or agreement, 

whether or not legally enforceable, to make a 

contribution." Candidates and committees 

should be required to keep records of written 

pledge cards and other similar written instruments, but they need not be reported. 

Independent Expenditures by Individuals 

(2 U.S.C. §434(e)) 

The threshold for the reporting of independent 

expenditures by individuals and other persons 

should be increased from $100 to $250. The 

present reporting burden on persons who make 

relatively small amounts of independent expenditures is not consonant with the purposes of 

the Act. The higher amount of $250 would 

appear to be a more realistic figure as to when 

independent expenditures begin to have an 

impact on election campaigns. 

Independent Contributions (2 U.S.C. §434(e)) 

Persons who make independent contributions in 

excess of $100 are required to file reports with 

the Commission. An independent contribution is 

a contribution to a person (other than a candidate or political committee) who makes an 

independent expenditure. The Commission 

recommends that independent contributors not 

be required to report to the Commission. 
41 

Instead, persons who file independent expenditure reports should be required to report the 

sources of any contributions in excess of $100 

which is donated with a view toward bringing 

about an independent expenditure. 

Disclaimer (2 U.S.C. §435(b)) 

The disclaimer required on all solicitations of 

contributions should be shortened to read: "A 

copy of our report is filed with and is available 

for purchase from the Federal Election Commission, Washington, D.C." The present disclaimer 

is redundant and reduces the amount of space or 

broadcast time used for advertising. 

Trade Associations (2 U.S.C. §441b(b)(4)) 

Trade association political action committees 

must obtain the separate and specific approval 

each year of each member corporation in order 

to be able to solicit the corporation's executive 

and administrative personnel. Some trade 

associations have thousands of members and it is 

a considerable administrative burden to obtain 

approval to solicit every year. The one-year time 

limitation should be removed and the trade 

association should be allowed to solicit until 

the corporation revokes its approval. 

Presidential Elections 

The Federal Election Campaign Act and Presidential Election Campaign Fund Act made 

sweeping changes in the financing of Presidential 

elections. Several amendments are need~d to 

improve both of these Acts in advance of the 

1980 Presidential election. 

Delegate Selection (2 U.S.C. §9032) 

Amendments are needed to delineate the status 

of delegates and delegate-candidates to Presidential nominating conventions and the applicability of the disclosure provisions and contribution and expenditure limitations to their 

activities. Congress should consider totally 

exempting from the Act financial activity in 

connection with delegate elections. Alternatively, Congress may wish to exempt from the 

definition of contribution and expenditure: 

(a) the payment by a delegate of all travel and 

subsistence costs incurred in attending caucuses 

or conventions; and (b) the payment of expenditures incurred by a State or local political 

party in sponsoring party meetings, caucuses and 

conventions for the purpose of selecting delegates. Another approach would be to distinguish 

"authorized" delegates (i.e., persons authorized 

by a Presidential candidate to raise or expend 

funds on his behalf) from "unauthorized" 

candidates. Only authorized delegates would 

be considered contributors to the Presidential 

candidate and expenditures by such delegates 

would be charged against the Presidential 

candidate's limitations. 

Support of Presidential Nominees 

(2 u.s.c. §9003) 

Congress may wish to clarify to what extent a 

Congressional candidate may give occasional, 

isolated or incidental support to the Presidential 

nominee of his party without such support 

counting as a contribution in-kind. A publicly 

financed Presidential campaign is prohibited 

from receiving any private contributions in the 

general election. During the 1976 elections, it 

was unclear under what circumstances a Congressional candidate could mention and support 

his political party's Presidential nominee. 

The brief mention or appearance of the Presidential nominee in newspaper ads or in television or radio ads should not be considered a 

contribution so long as the purpose is to further 

the election of the congressional candidate and 

the appearance is at the initiative of the Congressional candidate. 

Compliance Funds (2 U.S.C. §9004) 

The Federal Election Campaign Act. Amendments of 1976 specifically exclude from the 

definition of "contribution" the payment of 

legal and accounting services by a regular 

employer to insure compliance with the Federal 

Election Campaign Act and Chapters 95 and 96 

of Title 26 of the Internal Revenue Code. The 

Commission's Regulations specifically permit a 
42 

Presidential campaign to set up a separate 

account containing private monies to be used for 

com pi iance purposes. A major party Presidential 

candidate receiving full public financing in the 

general election may not otherwise receive 

private contributions. In order to insure the 

integrity of the Presidential general election 

public financing provisions and to eliminate 

the need for any private contributions in the 

general election, the Presidential Election 

Campaign Fund Act should be amended to 

provide a block grant of a specified amount for 

legal and accounting services for each candidate 

and committee receiving public funds. Similar 

grants should be considered for candidates who 

receive matching funds in the primary election. 

Presidential Election Campaign Fund 

(2 u.s.c. §9006) 

Under the current provisions, the Secretary of 

the Treasury is required to place first priority on 

funds for convention financing; second priority 

on funds for general election financing; and 

third priority on the matching-payment fund. 

Since the primaries occur before the general 

election, the Secretary may not have a clear idea 

of the amount to reserve for the general election. The Secretary may determine that a 

substantial portion of the entire fund needs to 

be reserved for a number of possible qualified 

nominees in the general election, thus denying 

Presidential primary candidates their full entitlements. On the other hand, the Secretary may 

make a determination which would not reserve 

sufficient monies for the general election fund 

to pay new party candidates who qualify in the 

general election. Since the amount in the fund is 

a fixed amount in that it is limited by the 

number of dollars received as a resu It of the tax 

checkoff provision, the Secretary may be faced 

with a situation where he must risk depleting the 

general election fund to assure full entitlement 

for Presidential primary candidates. Under some 

circumstances, the present system could be 

unworkable and should be modified either to 

guarantee full entitlement to all qualified 

candidates or to eliminate all discretion by the 

Secretary and the Commission in determining 

how to distribute partial entitlements. 

Repayments to the Fund (2 U.S.C. §9007) 

In its Regulations, the Commission has attempted to give candidates and committees ample 

leeway to challenge Commission determinations 

with respect to the repayment of funds to the 

Federal Treasury and sufficient time to gather 

funds to make repayments. These Regulations 

have generally operated fairly and equitably. 

However, there have been a few instances 

where this time period has been used to accrue 

interest on the amounts which the Commission 

has determined must be repaid to the Treasury. 

In order to simplify the repayment procedure 

the Commission recommends that all surplus 

funds, regardless of amount, be repaid to the 

Presidential Election Campaign Fund at the end 

of a campaign. (Any such repayment requirement should, of course, exclude payments made 

for tax purposes.) The statute also should be 

amended to require that any and all interest 

earned on public monies from savings accounts, 

government bonds, and other sources be returned to the Fund or the general fund of the 

Treasury. This latter requirement would insure 

that Presidential committees do not gain private 

advantage from funds which the Commission has 

determined must be repaid to the Fund or the 

general fund of the Treasury. In addition, 

while repayments under the Presidential Primary 

Matching Payment Account Act are made to the 

Presidential Election Campaign Fund, repayments under the Presidential Election Campaign 

Fund Act are made to the general fund of the 

Treasury. All repayments should be made to the 

Presidential Election Campaign Fund. 

Vice Presidential Candidates (2 U.S.C. §441a) 

The Act does not provide a coherent statutory 

framework for the treatment of Vice Presidential candidates. For example, the campaign 

depository of the Vice Presidential candidate is 

considered to be the campaign depository 

of the Presidential candidate. Yet, the definitions of the "candidate" and "Federal office" 

differentiate the Presidential candidate from the 
43 

Vice Presidential candidate. Thus, the Vice 

Presidential candidate is required to file disclosure reports separately from the Presidential 

candidate. In the Presidential general election, 

expenditures made on behalf of the Vice Presidential candidate are considered to be made on 

behalf of the Presidential candidate of the same 

political party and are thus subject to an expenditure limitation. These apparent contradictions 

should be reconciled. 

Contributions and Expenditure 

Limitations and 

Role of the Political Party 

A systematic, comprehensive, enforceable 

system of contribution and expenditure limitations was implemented for the first time in the 

1976 and 1978 elections. The Commission 

recommends the following changes in the 

application of these limitations: 

Party Activity (2 U.S.C. §441a(d)) 

Political parties have a central role to play in the 

political system. Campaign finance legislation 

must be carefully drafted to bolster the role of 

political parties in campaign financing, while 

preserving the integrity of the various contribution limits. One of the major failures of campaign financing legislation in the 1976 elections 

was the limited role which it delegated to State 

and local party committees. Accordingly, the 

Commission recommends that: 

1. State committees of a political party should 

be allowed to spend the greater of $20,000 or 

2 cents times the Voting Age Population 

on behalf of the Presidential candidate of the 

national party. State committees should be 

allowed to delegate this spending right to 

subordinate committees. 

2. Local and subordinate committees of a State 

committee should be allowed to distribute 

campaign materials and paraphernalia normally connected with volunteer activities 

(such as pins, bumper stickers, handbills, 

pamphlets, posters and yardsigns, but not 

billboards, newspapers, mass mailings, radio, 

television and other similar general public 

political advertising). These activities would 

be exempt from the limitations when undertaken on behalf of the Presidential candidate; 

would be subject to the disclosure provisions; could mention as few or as many 

candidates as deemed desirable; and would be 

financed with funds that are not earmarked 

for a particular candidate. 

3. The $500 exemptions for real and personal 

property, vendors and travel expenses which 

apply to candidates should be expanded to 

apply to political party committees (e.g., the 

use of real and personal property and the cost 

of invitations, food and beverages voluntarily 

provided by an individual to a political party 

committee should be exempted from the 

definition of contribution and expenditure 

up to $500). 

4. The statute should be amended to exempt 

from the definitions of contribution and 

expenditure payments made by or on behalf 

of a candidate or received by a political party 

committee as a condition of ballot access 

when these costs or payments are subsequently paid to the State. Currently, candidates make payments to State political 

party committees to gain access to the ballot 

and to defray the cost of the elections and 

these payments count as contributions. If 

these payments are in excess of $5,000, the 

candidate must exceed the contribution limits 

to gain ballot access. 

If the above-mentioned recommendations are 

adopted, the political parties will be given a 

strengthened role in the political process and 

volunteer activities will be encouraged. If the 

proposed changes are incorporated in the Act, 

26 U.S.C. §9012(f) should be repealed. 

Expenditure Limitations (2 U.S.C. §441a(b)) 

The experience of the 1976 elections suggests 

that the Congress may wish to raise the Presidential spending limitations. The entitlement for 

Presidential candidates receiving full funding for 

the general election could be increased substan-
44 

tially up to $35 million. The increased amount 

should be set in cognizance of the fact that it 

will be increased by the Cost-of-Living Adjustment. Similarly, the $2 million entitlement for 

the national nominating conventions of the 

political parties and the $10 million limitation 

on candidates seeking nomination for President 

should be increased. 

Contribution Limitation Anomalies 

(2 U.S.C. §441a(a)) 

When structuring an equitable balance in the 

application of the contribution ceilings, Congress should attempt to rectify two serious 

anomalies: 

1. A national political party committee which is 

not authorized by any candidate may accept 

contributions of up to $15,000 from multicandidate committees and $20,000 from any 

other person. However, if the Presidential 

nominee of the political party designates the 

national committee as his principal campaign 

committee, then the national committee is 

prohibited from accepting contributions in 

excess of $5,000 from all persons. Thus, the 

national committee of a political party is, in 

effect, prevented from becoming the principal 

campaign committee of its Presidential 

nominee. 

2. As was noted above, an individual can give a 

national political party committee up to 

$20,000 but a multicandidate committee can 

give only $15,000. 

Multicandidate Committee 

(2 U.S.C. §441a(a)(4)) 

In order to attain qualified multicandidate 

committee status (i.e., to be eligible to give 

$5,000 per election to Federal candidates), 

political committees could be required to make 

contributions of $100 or some other specified 

sum to five Federal candidates. Under the 

present Act, a political committee need give as 

little as $1 to four candidates in order to be 

eligible to give $5,000 to the fifth candidate, 

provided all other criteria are met. 

Contributions by Minors (2 U.S.C. §441a(a)) 

The Act does not stipulate at what age a minor 

child may make contributions. Presently, the 

Commission is forced to rely on subjective 

criteria such as whether "the decision to contribute is made knowingly and voluntarily by the 

minor child." Contributions by minor children 

under the age of 16 should be considered to 

have been made by the parent and should be 

subject to the parent's $1 ,000 contribution 

limitation -- unless the minor child's contributions aggregate $1 00 or less per candidate per 

election or per election cycle. 

Commission Duties, Powers 

and Authority 

Several provisions of the Act relating to the 

Commission's duties, powers and authority need 

to be modified or clarified. 

Advisory Opinions (2 U.S.C. §437f) 

Federal officeholders, candidates and political 

committees are allowed to request advisory 

opinions regarding compliance with the FECA. 

However, the Commission is prohibited from 

giving advisory opinions to other persons. Thus, 

several classes and groups subject to the provisions of the Act are not allowed to obtain 

formal guidance from the Commission on 

questions of interpretation. The Act should be 

amended to allow any person subject to the 

provisions of the Act to ask for an advisory 

opinion. 

Conciliation Period (2 U.S.C. §437g(a)(5)) 

The enforcement provisions of the Act provide 

for a mandatory 30-day conciliation period. The 

mandatory conciliation period should be shortened to 15 days to enable the Commission to 

process complaints more expeditiously and also 

to prevent the abuse of the mandatory conciliation period for purposes of delaying enforcement action close to the election. 

Multiyear Authorization (2 U.S.C. §439c) 

The Commission should be given a multiyear 
45 

authorization of appropriation in order to 

increase its ability to engage in long-range 

planning and on implementation of the law. The 

present scheme drains valuable staff resources 

each year in attempts to justify an authorization 

and frustrates intelligent management of the 

agency. 

Number of Legislative Days (2 U.S.C. §438(c)) 

The Congress should reduce the requisite 30 

legislative days for the review of Regulations to 

15 legislative days. 

Definition of Legislative Days 

(2 U.S.C. §438(c)(4)) 

The definition of "legislative days" should be 

clarified as to whether it includes only those 

days on which both Houses are in session or 

merely those days on which either House is in 

session. 

Index of Reports and Statements 

(2 U.S.C. §438(a)(6)) 

The requirement for the Commission to publish 

in the Federal Register a cumulative index of 

reports and statements filed with it should be 

repealed. The cost to the taxpayers to publish 

this index is in the thousands of dollars, with 

little public benefit. Alternatively, the Commission should be required to compile and maintain 

a cumulative index of reports and statements 

and publish in the Federal Register a notice 

of the existence of this index. 

Federal Reports Act (2 U.S.C. §437c) 

The Federal Election Campaign Act does not 

exempt the Commission from the requirements 

of the Federal Reports Act. The Commission is 

required to submit all forms and other similar 

materials requesting information from candidates and committees to the General Accounting 

Office for approval, thus delaying Commission 

efforts to improve its information retrieval 

systems. A major goal of the Federal Reports 

Act is, of course, to prevent duplicative Federal 

paperwork. Since, however, the Commission 

is granted exclusive primary jurisd1ction over the 

Federal Election Campaign Act and no other 

Federal agencies have responsibility for collecting data in this area, the Commission should be 

exempt from the requirements of this law. Such 

an exemption would facilitate Commission 

efforts to streamline the reporting process and 

expedite the simplification and development of 

forms and other similar materials. 

Judicial Review (2 U.S.C. §437h) 

The Act contains different judicial review 

provisions which Congress might wish to consider conforming to each other. As noted by the 

Court of Appeals for the District of Columbia, 

no apparent reason exists for different review 

provisions in Chapters 95 and 96 of Title 26. 

Congress might wish to consider making the 

provisions of 26 U.S.C. 9011, including the 

provisions for expedited review of 9011 (b), 

apply to Chapter 96, perhaps making 9040 and 

9041 identical to 9010 and 9011. Additionally, 

Congress might wish to address what the 

Supreme Court called the "jurisdictional ambiguities" resulting from Title 2 having a totally 

different expedited review provision (2 U.S.C. 

§437h) for questions of the constitutionality 

and construction of the statutory provisions. 

Clarification 

Principal Campaign Committees 

(2 U.S.C. §432(e)) 

Under the current law, the name of most principal campaign committees identifies the candidate supported. However, in some cases, it is 

difficult to determine which candidate a principal campaign committee supports. In such 

cases the committee's name does not contain the 

candidate's name as, for example, "Good 

Government Committee" or "Spirit of '76." In 

order to avoid confusion, the Act should require 

the name of the principal campaign committee 

to contain in its name the name of the candidate 

which designated the committee. 

Separate Segregated Funds (2 U.S.C. §441b) 

Presently many names of the separate segregated 
46 

funds do not contain the name of the sponsoring 

organization. Consequently, candidates and 

committees sometimes have great difficulty in 

ascertaining the source of a PAC contribution if, 

for example, it comes from "The Good Government Committee." In addition, the press and 

the public frequently cannot determine the 

actual source of these contributions. The Act 

should require a separate segregated fund to 

contain in its name the name of the sponsoring 

organization. 

Use of Reports (2 U.S.C. §438(a)(4)) 

An exception to the present statute should be 

made to allow candidates and others to obtain 

the names and addresses of political committees 

from reports and statements filed at the Commission. 

Candidate Petty Cash Fund (2 U.S.C. §437b) 

The law currently requires all expenditures to be 

made through a designated campaign depository, 

except for petty cash expenses by political 

committees of $100 or less. This exemption for 

petty cash expenses is limited to political 

committees, but should be expanded to permit 

candidates to make petty cash expenses. 

Corporate and Union Activity 

Honoraria (2 U.S.C. §431 (e)(5)) 

The Act presently permits corporations and 

labor organizations to use general treasury 

money to give honoraria to Federal officeholders who may also be candidates. If the 

candidates are not Federal officeholders, there is 

no limit on the amount of the honoraria that 

may be received. The Commission recommends 

that corporations and labor organizations be 

prohibited from giving honoraria to Federal 

candidates. 

Registration/Get-Out-The-Vote 

(2 u.s.c. §441b(b)(2)) 

Congress may wish to amend the Act to allow 

corporations and labor organizations to conduct 

nonpartisan registration and get-out-the-vote 

activities aimed at the general public without 

sponsorship of a nonpartisan organization so 

long as the activities are not targeted toward 

selected groups and so long as the activities 

merely urge people to register and to vote. 

Currently, corporations and labor organizations 

may only participate in such activities if they are 

cosponsored with and conducted by an organization which does not support or endorse 

candidates or political parties. The present 

overly restrictive provision effectively prevents 

corporations and labor organizations from 

engaging in any political activity -- such as 

putting up signs urging the general public to 

register and vote and paying for public service 

broadcast spots which merely urge people to 

vote. 

Miscellaneous 

Dual Candidacies (2 U.S.C. §441a) 

Amendments to the law are needed to delineate 

the status of dual candidacies, and in particular, 

the applicability of the disclosure provisions and 

limitations on expenditures by and contributions to persons who are candidates for two 

Federal offices at the same time, such as: 

a) President and Senate, 

b) President and House of Representatives, 

c) House and Senate, 

d) Delegate and Congress, 

e) Federal and State or local office. 

For example, if an individual is simultaneously a 

candidate for the Senate (where there is no 

expenditure limitation) and for the Presidency 

(where there is an expenditure limitation for 

those candidates accepting public funds) in the 

same State, are both of his or her campaigns 

subject to the Presidential spending ceiling for 

that State or may his or her senatorial campaign 

spend unlimited amounts of money? Also, if a 

candidate for Congress (who may not accept 

contributions in excess of $1,000 per election -­

$5,000 for a multicandidate committee) is 

simultaneously an unauthorized delegate-
47 

candidate may he or she accept contributions of 

$25,000 from individuals or of unlimited 

amounts from other persons for the delegatecandidacy or are both campaigns subject to the 

Congressional ceilings? 

Private Benefits (2 U .S.C. § 439a) 

Prior to 1972, the law prohibited the purchase 

of goods or articles the proceeds of which inured 

to the benefit of a Federal candidate or political 

committee. (18 U.S.C. §608(b), repealed by the 

Federal Election Campaign Act of 1971.) 

Currently, the Act provides that excess campaign funds may be used for any lawful purpose 

(2 U.S.C. §439a). Congress should reinstate 

some strict controls on the conversion of political funds to personal use. 

Technical Amendments 

The following technical amendments are recommended to clarify the meaning of certain provisions of the Act. 

2 U.S.C. §431 (e)(5) 

The $500 exceptions to the definitions of 

contribution and expenditure occur at the end 

of the paragraph in 2 U.S.C. §431 (e)(5), but 

occur at the end of each exception or subparagraph in 2 U.S.C. §431(f)(4). These provisions 

should be made parallel by adopting the method 

used in 2 U.S.C. §431 (f)(4). The phrase "to the 

extent that the cumulative value" is used in 2 

U.S.C. §431 (e)(5), but the phrase "if the 

cumulative value" is used in 2 U.S.C. §431 

(f)(4). Under one interpretation of the abovementioned provision, if a person exceeds the 

$500 threshold only the amount in excess of 

$500 must be disclosed and credited to the 

limits. On the other hand, in the latter provision, 

the full amount -- including any sums under 

$500 -- must be disclosed. The phrase "to the 

extent that" should be substituted for "if" in 2 

u.s.c. §431 (f)(4). 

2 U.S.C. §432(e) 

In 2 U.S.C. §432(e)(2), the term "political 

committee" should read "authorized political 

committee" in order to clarify any ambiguity 

that might exist about which committees file 

with the principal campaign committee. 

2 U.S.C. §433(a) 

The last sentence in 2 U.S.C. §433(a) is no 

longer needed and should be stricken. 

2 u.s.c. §434(b)(12) 

Two provisions of the Act, 2 U.S.C. §434 

(b)(12) and §436(c), relate to the reporting of 

debts and obligations. These actions should be 

consolidated. 

2 U.S.C. §437c(f)(2) 

The language relating to the procurement of 

temporary and intermittent services contained in 

26 U.S.C. §901 O(a) and §9040(a) should also 

be placed in 2 U.S.C. §437c(f)(2). 

2 u.s.c. §455 

2 U.S.C. §455 was improperly codified and 

"Title Ill of this Act" should be stricken each 

place it occurs and in lieu thereof should be 

inserted "chapter." 

26 u.s.c. §9011(b)(1) 

The term "contrue" in 26 U.S.C. §9011 (b)(1) 

should be "construe." 

26 u.s.c. §527(f)(3) 

The cross-reference in 26 U.S.C. §527(f)(3) 

should be changed from "section 610 of Title 

18" to "section 441b of Title 2." 

26 u.s.c. §9002 

Chapters 95 and 96 of Title 26 of the Internal 

Revenue Code contain different definitions of 

"qualified campaign expense." Chapter 95 

defines a "qualified campaign expense" to mean 

an expense incurred to further the election of a 

Presidential candidate to Federal office. Chapter 

96 defines "qualified campaign expense" to 

mean an expense incurred in connection with 

a campaign for nomination to the Office of 

President. These provisions should be parallel 

in language to reflect identical meaning. 
49 

Commissioners 

Joan D. Aikens, Chairman 

April 30, 1981 * 

Presently Chairman, Mrs. Aikens was formerly 

Vice President of Lew Hodges/Communications, 

a public relations firm located in Valley Forge, 

Pennsylvania. From 1972 until 1974, she was 

President of the Pennsylvania Council of Republican Women and served on the Board of Directors of the National Federation of Republican 

Women. A native of Delaware County, Pennsylvania, Mrs. Aikens has been active in a variety of 

volunteer organizations. She received her B.A. 

from Ursinus College, Collegeville, Pennsylvania. 

Her original appointment to the Federal Election Commission in 1975 was for a one-year 

term. She was reappointed for five years when 

the FEC was reconstituted. 

Robert 0. Tiernan, Vice Chairman 

April 30, 1981 

Robert Tiernan, Vice Chairman of the Commission, served as a Democratic Member of Congress from Rhode Island for eight years, and 

prior to that as a State legislator for seven years. 

An attorney, he was born in Providence, Rhode 

Island, and graduated from Providence College 

and Catholic University Law School. Mr. 

Tiernan has been admitted to practice in all 

Federal courts, the State of Rhode Island, and 

the District of Columbia. He has held various 

national and State party positions. Originally 

appointed for two years, he received a five-year 

term upon reconstitution of the Commission. 

Thomas E. Harris 

April 30, 1979 

Mr. Harris was Commission Chairman between 

May 1977 and May 1978. Before serving on the 

Commission, he was associate general counsel to 

the AFL-CIO in Washington, D.C., from 1955 to 

1975. He had held the same position with the 

CIO from 1948 until it merged with the AFL in 

1955. Prior to that, he was an attorney in 

private practice and with various Government 

*Term expiration date. 

Appendix 1 

Biographical Data on 

Commissioners and 

Statutory Officers 

agencies. A native of Little Rock and a 1932 

graduate of the University of Arkansas, Mr. 

Harris is a 1935 graduate of Columbia University 

Law School, where he was on the Law Review 

and was a Kent Scholar. After graduation, he 

clerked one year for Supreme Court Justice 

Harlan F. Stone. He was originally appointed to 

the Commission for a four-year term and upon 

reconstitution received a three-year appointment. 

John W. McGarry 

Mr. McGarry served in the Navy during World 

War II. After the war, he graduated from Holy 

Cross College and earned a law degree at Georgetown Law Center. From 1959 to 1962, Commissioner McGarry was Assistant Attorney General 

for Massachusetts. In 1962, he was named chief 

counsel for the House Special Committee to 

Investigate Campaign Expenditures. Since 1973, 

he has served as special counsel on elections to 

·the Committee on House Administration. 

Commissioner McGarry was appointed under the 

"recess appointment" clause of the U.S. Constitution on October 25, 1978. 

William L. Springer 

April 30, 1977 

Mr. Springer, an attorney by profession, served 

as State's Attorney of Champaign County, 

Illinois, from 1940 to 1942. After military 

service in the Navy, he returned to Champaign, 

Illinois, and served as County Judge from 1946 

to 1950. In 1950, he was elected to the 82nd 

Congress and reelected to each succeeding 

Congress from the 22nd Congressional District 

of Illinois until his retirement at the close of the 

92nd Congress. President Nixon appointed him a 

Commissioner of the Federal Power Commission 

in 1973. He resigned in December 1975 and was 

appointed to the Federal Election Commission 

by President Ford in 1976. Mr. Springer is a 

graduate of DePauw University and the University of Illinois Law School. He received LL.D. 

degrees from Millikin University in 1953, 

Lincoln College in 1966, and DePauw University 

in 1972. 
50 

Neil 0. Staebler 

April 30, 1977 

The Commission's first Vice Chairman, Neil 0. 

Staebler was formerly chairman of the Michigan 

Democratic State Central Committee (1950-61 ), 

a member of the National Democratic Committee (1965-68 and 1972-75), a one-term Member 

of the House (1963-65) and a gubernatorial 

candidate in 1964 against former Governor 

George W. Romney. He served on President 

Kennedy's Commission on Campaign Financing 

in 1961 and was vice chairman of the 1970 

Twentieth Century Task Force on Financing 

Congressional Campaigns. Currently the owner 

of a land development company, Mr. Staebler 

was graduated from the University of Michigan 

in 1926. Originally appointed to the Commission for three years in 1975, he was reappointed 

upon reconstitution for a one-year term. 

Although Commissioner Staebler's term expired 

on April 30, 1977, he continued to serve 

actively on the Commission until the "recess 

appointment" of Commissioner John W. 

McGarry on October 25, 1978. 

Vernon W. Thomson 

April 30, 1979 

Vernon Thomson, served as Chairman of the 

Commission between May 1976 and May 1977. 

He was a Republican Member of Congress from 

Wisconsin from 1961 to 1975. Before that, he 

was his State's Governor (1957-59), Attorney 

General (1951-56) and a member of the State 

legislature (1935-50). He holds a B.A. from the 

University of Wisco.,sin and is a graduate of its 

law school. He was originally appointed to the 

Commission for five years. When the Commission was reconstituted, the President reappointed him for a three-year term. 

Ex Officio Commissioners 

Edmund L. Henshaw, Jr. 

Edmund L. Henshaw, an Ex Officio Member of 

the Commission, was elected Clerk of the House 

of Representatives on December 17, 1975. 

Prior to that, he served as Executive Director of 

the Democratic National Congressional Committee, from 1972 to 1975, and as Research Director of the Democratic National Congressional 

Committee from 1955 to 1972. He received a 

B.S. degree from the University of Maryland in 

1954, and attended George Washington University Law School from 1955 to 1956. 

Douglas Patton, attorney, serves as Special 

Deputy to the Clerk of the House at the Commission. 

Joseph Stanley Kimmitt 

Stanley Kimmitt, an Ex Officio Member of the 

Commission, was elected Secretary of the Senate 

in April 1977. He previously served as Secretary 

of the Majority for the Senate (1966-77) and as 

Administrative Assistant to the Majority Leader 

of the Senate. A native of Great Falls, Montana, 

he holds a Bachelor of Science degree in political 

science from Utah State University. Mr. Kimmitt 

also attended the University of Montana and did 

graduate work at George Washington University. 

Mr. Kimmitt was inducted as a private in the 

U.S. Army in 1941 and retired as a colonel 

in 1966. 

Harriet Robnett, attorney, serves as Special 

Deputy to the Secretary of the Senate at the 

Commission. 

Statutory Officers 

Orlando B. Potter, Staff Director 

Before joining the Commission, Orlando Potter 

was consultant to the Secretary of the U.S. 

Senate in the administration of campaign 

disclosure laws. Prior to that, he was legislative 

assistant to U.S. Senator Claiborne Pell, and in 

1968 was a candidate for the U.S. House of 

Representatives from New York. Mr. Potter 

previously was a Washington correspondent and 

editorial writer for the Providence (R.I.) Journal 

Bulletin. A 1950 graduate of Hamilton College, 
51 

Mr. Potter also holds a Masters Degree from Yale 

University. He received a Congressional Staff 

Fellowship from the American Political Science 

Association in 1970, and did graduate work in 

computer science at American University. 

William C. Oldaker, General Counsel 

William Oldaker began serving as General Counsel on January 1, 1977, after being Assistant 

General Counsel for Compliance and Litigation 

since 1975. Holding B.A. and J.D. degrees from 

the University of Iowa, he also attended the 

Graduate School of Business at the University of 

Chicago. Prior to coming to the Commission, 

Mr. Oldaker served with the Federal Communications Commission and the Equal Employment 

Opportunity Commission. 
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Federal Election Commission 

Office of Office of the 

General Counsel Staff Director 

Office of Planning I and Management I I T I 

Litigation and Reports Public Disclosure Enforcement Analysis 

Regulations and Advisory Opinions J Information l Data Systems 

Legislation and Policy Development Services I 

Joan D. Aikens Robert 0. Tiernan Thomas E. Harris John W. McGarry William L. Springer Vernon W. Thomson J.S. Kimmitt Edmund L. Henshaw 

Chairman Vice Chairman Commissioner Commissioner Commissioner Commissioner Ex Officio/Senate Ex Officio/House 

Audit 

Administration 

-
54 

January 

1 Reports Analysis Division established. 

9 FEC publishes the names of 1977 nonfilers. 

10 Clearinghouse Advisory Panel meets. 

17 FEC releases updated survey on State 

Disclosure of Federal Election Campaign Reports. 

31 - Year-end report due. 

February 

1 - Commission publishes comprehensive 

Campaign Guide for Congressional Candidates and Their Committees. 

6-9 - FEC releases preliminary 1977 campaign finance statistics on nonparty 

political committees. 

9 - The House Appropriations Subcommittee on Treasury, Postal Service and 

General Government hears Commission 

testimony on the FEC budget request 

for Fiscal Year 1979. 

17 - Commission completes revisions of 

FEC Form 7 (Report of Communication Costs by Corporations and Membership Organizations). 

March 

1 - Commission sends Congress report on 

its 1977 activities under the Freedom 

of Information Act. 

5 - FEC releases preliminary 1977 campaign finance figures for political party 

committees. 

15 - Commission makes available to the 

public its Index of Office Account 

Reports compiled from reports filed on 

October 15, 1977. 

31 - The Commission transmits to Congress 

and the President its Annual Report for 

1977. 

April 

3 - Repayment hearings held to allow 1976 

Presidential candidate George C. 

Wallace to appeal a Commission determination that he must repay certain 

Federal matching funds to the U.S. 

Treasury. 

6 - Commission approves new audit policy 

establishing priorities for audits to be 

conducted during the remainder of 

Fiscal Year 1978. 

7 - FEC issues a Federal Register notice 

requesting comments on six areas of 

proposed Regulations concerning 

public financing. 

9 - FEC releases Reports on Financial Activity, Interim Report No. 1 on activity 

of party and nonparty political committees during 1977-78. 

10 First quarter report due. 

15 Report due on office account receipts 

and disbursements. 

19 Federal Register notice announces 

Commission decision to vacate certain 

policy pronouncements published 

between June 1975 and January 1977. 
Appendix 55 3 

Chronology of Events, 

1978 

May 

18 - The Commission unanimously elects 

Vice Chairman Joan D. Aikens as its 

new Chairman and Commissioner 

Robert 0. Tiernan as its new Vice 

Chairman. 

31 - FEC publishes a notice in the Federal 

Register requesting comment on the 

Commission's Regulations governing 

the public financing of Presidential 

elections. 

June 

8 FEC approves its Rules of Procedure of 

the Federal Election Commission. 

10 Clearinghouse for Election Administration announces completion of its 1978 

Survey of State Campaign Finance. 

16 - U.S. District Court of the District of 

Columbia renders decision in FEC v. 

AFL-C/0 suit, granting the Commission's motion for a summary judgment 

in the case. 

19 - FEC and the Federal Communications 

Commission issue a Joint Public Notice 

detailing examples of notices which 

may be used on broadcast communications to comply with both FCC and 

FEC requirements. 

20- FEC holds a public hearing on suggested revisions to Commission procedures 

and Regulations governing the public 

financing of Presidential elections. 

July 

2 - FEC releases the results of a study on 

preelection financial disclosure reports 

by Federal primary candidates. 

10 Second quarter report due. 

13 The Commission approves its Freedom 

of Information Act Regulations. 

20 U.S. District Court of the District of 

Columbia renders decision in FEC v. 

National Education Association, et a/., 

granting the Commission's motion for a 

summary judgment in the case. 

August 

14 Clearinghouse Advisory Panel meets. 

24 Commission approves its proposed budget for Fiscal Year 1980. 

28 Commission sends notice to all candidates and committees regarding corporate and labor organization contributions. 

31 - Commission approves guidelines for the 

disclosure of particulars of expenditures by non-Presidential candidates 

and committees. 
56 

September 

1 Commission publishes Campaign Guide 

for Political Committees. 

7 Commission releases Reports on Financial Activity, Interim Report No. 2 on 

activity of party and nonparty political 

committees. 

26 - The Federal Aviation Administration 

changes its Regulations to permit 

private aircraft owners and other noncommercial operators to accept payment for transporting candidates for 

Federal office. 

28 - Commission releases Reports on Financial Activity, Interim Report No. 3 on 

the financial activity of Congressional 

candidates in 1977 and 1978. 

28 - Pregeneral election report due. 

October 

10 Third quarter report due. 

15 Report due on office account receipts 

and disbursements. 

25 John McGarry is sworn in as a Commissioner of the FEC, replacing Neil 

Staebler, whose term expired on 

April30, 1977. 

28 - Preelection report of receipts and 

expenditures due. 

November 

1 - Commission releases its new general 

information brochure, The FEC and 

the Federal Campaign Finance Law. 

2 - Commission releases statistical study of 

nonparty political activity covering 

reporting periods from January 1, 

1977, through September 30, 1978. 

3 - Index on Independent Expenditures 

is released. Commission also releases 

updated statistics on Congressional 

candidates based on reports filed from 

January 1, 1977, through September 

30, 1978. 

8 General election for U.S. House and 

Senate. 

18 U.S. District Court of the District of 

Columbia grants FEC's motion to dismiss the Martin Tractor Company, et 

a/. v. Federal Election Commission et 

a/. suit. ' 

22 - U.S. District Court of the District of 

Columbia grants FEC's motion to dismiss the National Chamber Alliance 

for Politics, et a/. v. Federal Election 

Commission, eta/. suit. 

December 

7 Postgeneral election report due. 

13 - Commission completes revisions of 

FEC Form 3 (Report of Receipts 

and Expenditures) and its supporting 

schedules. 
Appendix 4 57 

1978 Advisory 

Opinion Requests 

Category of Requester Number of Requests 

Congressional Candidates 

House 

Senate 

Party Committees 

National 

State or Local 

Presidential Candidates 

1976 

1980 

Nonparty Committees 

Corporate 

Labor 

Trade Association 

Non-441 b Organizations 

Officeholders* 

*This category is comprised of Federal officeholders (including some Congressional candidates) requesting opinions about the application of the Act to the receipt of honoraria and 

the use of excess campaign funds. 

41 

13 

12 

... 4 

8 

Total Advisory Opinion Requests= 107 

- 5 

•2 

-3 

- 22 

8 ...5 

6 

..3 

14 

54 
59 Appendix 5 

FEC Advisory Opinions: 

Summaries 

The following summaries of Advisory Opinions 

(AO's) include those issued between January 1, 

1978, and December 31, 1978. Those seeking 

guidance for their own activity should consult 

the full text of an advisory opinion and not rely 

on the synopsis given here. Copies of the full 

text of AO's are available from the Office of 

Public Records at the Commission. (Telephone: 

202/523-4148 or toll free, 800/ 424-9530) 

AO 1976-79: Solicitation of 

Corporate "Members" 

Because the Articles of Incorporation of the 

National Right to Work Committee (NRWC), a 

nonprofit corporation, preclude it from having 

members, neither NRWC nor its separate segregated fund, the Employee Rights Campaign 

Committee (ERCC), may solicit contributions 

from individuals other than the administrative or 

executive personnel (and their families) of 

NRWC. Although ERCC stated that it believes 

" ... it may solicit supporters of NRWC's goals 

as 'members'...," the Commission determined 

that the fact that NRWC has no members " ... is 

dispositive of the issue raised." 

AO 1977-2: Connected Organization 

The National Association of Electric Companies 

(NAEC), a trade association, is the connected 

organization of the Constructive Congress 

Committee (CCC), a political committee. The 

connection between NAEC and CCC was determined to exist because the following circumstances indicated that NAEC "directly or 

indirectly establishes, administers, or financially 

supports" CCC: 

-- A continuing pattern of CCC solicitations was 

directed to personnel of NAEC members; 

-- CCC enjoyed ready access to NAEC member 

personnel; 

-- CCC invited NAEC members to make suggestions on CCC contribution recipients; and 

-- CCC fundraising activity coincided with 

NAEC meetings. 

CCC must amend its Statement of Organization 

to reflect the fact that NAEC is its connected 

organization. All solicitations by CCC must be 

conducted in accordance with 2 U.S.C. 

§441b(b)(4)(D) and Part 114 of the Commission's regulations. 

AO 1977-18: Solicitation by 

Trade Association 

The Proprietary Industry Political Action 

Committee (PIPAC) may not solicit the Board 

of Directors of its sponsoring trade association, 

the Proprietary Association (the Association), 

because they are not stockholders or executive 

or administrative personnel of the Association. 

However, since the Board consists of executive 

and administrative personnel of the corporate 

members of the Association, PIPAC may solicit 

members of the Board under the FEC's trade 

association regulations (11 CFR §114.8). These 

regulations require that the corporate member 

give prior approval to a solicitation by a trade 

association and limit such approval to only one 

trade association in any calendar year. Those 

Board members who are employed by a corporation which has not consented to a PI PAC 

solicitation or which has consented to a solicitation by another trade association could 

not be solicited by PIPAC. 

AO 1977-27: Congressional Intern 

Program 

Congressman L. A. "Skip" Bafalis may sponsor 

an intern program for high school students from 

his district without incurring any reporting 

obligations under the Act or regulations (2 

U.S.C. §439a; 11 CFR 113.4). The donations 

and disbursements relating to the intern program 

(to cover travel and incidental expenses of the 

participants) are not made for the purpose of 

supporting the Congressman's activities as a 

holder of Federal office. None of the funds are 

under the Congressman's control at any time. 

The Tenth Congressional District Intern Program, a corporation organized to manage the 
60 

program, has achieved tax exempt status under 

Section 501 (c)(3) of the Internal Revenue 

Code. The Commission regards AO 1977-27 as 

superceding those parts of AO 1977-13 (summarized in the Record, June 1977, p. 2) which 

deal with the application of the 2 U.S.C. §439a 

and 11 CF R 113 to the intern program described in that advisory opinion. 

AO 1977-32: Trade Association Solicitations 

of Municipal Corporations 

APTA-PAC is a political committee established 

by the American Public Transit Association 

(APTA), a trade association representing the 

urban transit industry. It must obtain specific 

solicitation approval from its municipal corporate members (as well as other corporate members) before soliciting those members' executive 

and administrative personnel. 

AO 1977-37: Contribution Collection 

Systems 

The National Education Association Political 

Action Committee (NEAPAC) may not use two 

proposed systems as alternatives to the collection of political funds through the reverse 

checkoff procedure. The reverse checkoff 

procedure is a collection system which requires 

an individual to make a payment to a political 

fund in addition to his/her union dues or fees. If 

the individual does not wish to contribute to the 

political fund, he/she must submit a written 

request for a refund. 

System I proposed cash options which would 

not require that a political contribution be 

included with the dues payment if the individual 

paid his/her dues in cash. In some local affiliates, 

the cash option would require that the individual pay his/her dues in a lump sum (annual 

cash payment option). In other locals, an 

individual could pay his/her dues in installments. 

The number of installments would vary from 

State to State, but would in no case be less 

than three (installment cash payment option). 

If an individual utilizes the cash payment 

options to avoid the reverse checkoff procedure, 

he/she would lose the convenience of paying 

his/her dues through payroll deduction. Additionally, the annual cash payment option is not 

permissible in that a lump sum payment would 

be financially burdensome and would not 

provide an acceptable alternative to the use 

of the reverse checkoff procedure itself. A 

four-vote majority of the Commission did not 

express an opinion as to the specific use of the 

installment cash payment option. 

System II (premembership reimbursement 

option) required the deduction of political funds 

from the paychecks of all individuals who 

authorized payroll deduction. However, upon a 

written submission, NEA would return the 

political funds at or before the beginning of the 

membership year (usually September 1 ), rather 

than after that time as under the reverse checkoff procedure. 

The premembership reimbursement option 

merely alters the timing of the reimbursement 

and does not relieve the unlawful aspects of the 

reverse checkoff procedure. Chairman Thomas 

Harris issued an opinion dissenting from the 

majority's conclusions on the premembership 

reimbursement system. 

Neither System I nor System II adequately deals 

with the prohibition against soliciting nonmembers of the union, specifically agency fee payers. 

Thus, the proposed systems could not be utilized in any manner to solicit contributions from 

any person other than members of NEA or their 

families. 2 U.S.C. §441b(b)(4)(A)(ii). 

AO 1977-40: Contribution 

Limitations 

Since the Commission is still in the process of 

securing facts as to whether the Maryland Medical Political Action Committee (MMPAC) and 

the American Medical Political Action Committee (AMPAC) are affiliated, the Commission 

cannot issue an advisory opinion which concludes that Congressman Newton Steers' 1976 

campaign may lawfully accept contributions 

totaling $11,100 from these two committees. If 
61 

the Commission determines at a future date that 

MMPAC and AMPAC are affiliated, Congressman Steers' principal campaign committee 

" ... will have to return the excess 1976 contributions ($1, 1 00) and may be determined to be 

in violation of the Act." The $1,100 may be 

regarded by Congressman Steers as contributions 

to his 1978 campaign, provided the contributors 

give the Congressman written designations to 

that effect. If such designations are received, the 

Congressman's principal campaign committee 

would have to amend its past reports to disclose 

that the contributions are made with respect to 

a 1978 election. 

AO 1977-42: Candidate Participation in 

Radio Program 

Ken Hechler, a candidate for the U.S. House of 

Representatives, may participate as host and 

interviewer on two radio programs without the 

funding of the programs being considered a 

contribution or expenditure on his behalf. This 

conclusion was based on the following conditions: 

-- The broadcasts did not contain any communication expressly advocating the election of 

· Mr. Hechler or advocate the defeat of any 

other candidate; 

-- The broadcasts did not contain any solicitation of campaign funds for Mr. Hechler; and 

-- The broadcasts were not conducted to influence the election of Mr. Hechler to Federal 

office. 

The opinion expressed no oprmon as to the 

application of the Communications Act or 

Federal Communications Commission rulings to 

the activity described. 

AO 1977-43: Receiving Contributions After 

Termination Reports 

The Glenn Brown for Congress Committee (the 

Committee) may not receive contributions or 

make expenditures after it has filed a valid 

Termination Report. The Committee may not 

be reactivated solely for the purpose of accepting a contribution designated to retire a 1976 

election debt which the Committee previously 

owed to the candidate, but which the candidate 

subsequently forgave in order to permit the 

Committee to terminate. 

AO 1977-44: Solicitations by Federation 

of Trade Associations 

The Association of Trial Lawyers of America 

(ATLA), a nonprofit membership corporation 

comprised of individuals, may administer 

and solicit contributions to the Attorneys 

Congressional Campaign Trust (ACCT), a 

multicandidate committee formed in 1975. 

ATLA is acknowledged as the "connected 

organization" of ACCT. 

ATLA's affiliate organizations (including branch 

trial lawyers organizations in four States and 

official affiliate trail lawyers organizations in 45 

States, Puerto Rico and the District of Columbia) are considered trade associations and ATLA 

is considered a federation of trade associations. 

Consequently, ATLA and its affiliates may 

either engage in a joint solicitation of the 

members of ATLA's affiliated associations, or 

the affiliated associations may delegate their 

solicitation rights to ATLA. Moreover, a local 

organization affiliated with a State affiliate is 

considered a "local affiliate" of ATLA. Members 

of these local affiliates are thus within the 

permissible class of solicitees of the national 

organization, ATLA. The State affiliates may 

also solicit members of the local affiliates. 

Contributions received by ACCT as a resu It of 

improper solicitation of persons who were not 

members of either ATLA or its affiliates are 

required to be returned to the donors or utilized 

in a lawful manner which does not constitute a 

"contribution" or an "expenditure" under the 

Act. Unsolicited contributions from nonmembers, however, if otherwise lawful under the act, 

may be accepted by ACCT. 

The advisory opinion explicitly declined to state 

any conclusion with respect to the legality of 

past solicitations by ACCT, ATLA or any of its 

branches or affiliates. 
62 

AO 1977-49: Solicitations by Corporate 

Political Action Committee 

Kerr-McGee Corporation (Kerr-McGee) or its 

political action committee (K-MPAC) may use a 

bank as custodian in connection with a twiceyearly solicitation of its employees, even though 

the bank holds Kerr-McGee stock as a fiduciary, 

provided the bank preserves the anonymity 

of contributors (and those not contributing) in 

accordance with 11 CFR 114.6(d). Such a bank 

may also be used as an independent mailing 

service for purposes of the twice-yearly solicita· 

tions. 

Kerr-McGee is required to make the names of its 

stockholders available to a labor organization (or 

an independent mailing service) in accordance 

with 2 U.S.C. §441b and 1J CFR 114.6(a), only 

if it or K-MPAC solicits employees or stock· 

holders under the twice-yearly solicitation 

provisions of the Act. 

Kerr-McGee must bear the cost of preparing a 

list of stockholders or employees (and their 

addresses) for an independent mailing service, if 

it does not wish to disclose these names to a 

labor organization requesting them under 11 

CFR 114.6(e}. However, the cost of producing 

labels for the labor organization's mailing, or 

other similar expenses (such as the preparation 

and actual mailing of the labor organization's 

solicitation) must be borne by the labor organization itself. 

Under the twice-yearly solicitation provisions, 

Kerr-McGee must make available to a labor 

organization the names and addresses of all 

stockholders and employees, " ... regardless of 

the corporation's decision to refrain from 

soliciting those persons on the list who may be 

foreign nationals...." 

Kerr-McGee may not use its twice-yearly solicitation materials for any purpose other than 

soliciting contributions. It may, however, quote 

pertinent excerpts from the Act and regulations 

or from advisory opinions issued by the Commission. 

Two other questions contained in the advisory 

opinion request were " .•. not posed in a specific factual context and therefore an advisory 

opinion responding to them (was) not appropriate." The opinion did, however, cite several 

relevant sections of the Commission's regulations. 

The Commission was unable to answer by the 

required four-vote majority one of the questions 

posed by Kerr-McGee concerning the solicita· 

tion, as stockholders, of employees participating 

in the corporation's Employee Stock Ownership 

Plan (ESOP). A separate statement of opinion 

concerning this issue was released jointly by 

Vice Chairman Joan D. Aikens, Commissioner 

Vernon W. Thomson and Commissioner William 

L. Springer. 

AO 1977-52: Retiring 1974 and 1976 Debts; 

Transfer of Debts 

Hess Dyas' 1974 campaign committee (for the 

House of Representatives) and his 1976 committee (for the Senate) may transfer their debts and 

obligations to Dyas' 1978 campaign committee 

(for the House). The 1974 and 1976 committees 

may then terminate, passing on their reporting 

obligations for the 1974 and 1976 debts to the 

1978 campaign committee. That committee 

would be required to itemize the 1974 and 1976 

(primary election) debts, and contributions 

designated to retire those debts, separately 

on Form 3, Schedules A and C. 

The 1978 campaign committee may use contributions to retire the 1974 and 1976 debts only 

if contributors are informed that their contributions will be used in this manner and if the 

contributions are expressly earmarked for that 

purpose (for example, by notation on a check). 

Contributions designated and used to retire the 

1974 debt are not limited since no contribution 

limits applied to that election. 

On the other hand, contributions designated to 

retire the 1976 campaign debts are subject to 

the 1976 limits. Persons may designate contribu· 

tions to retire the 1976 debt only to the extent 
63 

they have not previously "used up" their limits 

applicable to the Senate primary election in 

1976. 

The Commission declined to state an opinion on 

whether the Dyas committee could use excess 

campaign funds from the 1978 campaign to 

retire the 1974 and 1976 debts since the question was hypothetical. 

AO 1977-53: Activity by Foreign-Based 

Trade Association 

The Asia-Pacific Council of American Chambers 

of Commerce (APCAC) may not establish a 

political committee to support Federal candidates because it is considered a "foreign 

national." The Act expressly prohibits a foreign 

national from making any contributions in 

connection with a Federal election. 2 U.S.C. 

§441e. APCAC is deemed to be a foreign 

national because: 

·· A "foreign national" includes an association 

or organization whose place of business is in 

a foreign country (22 U.S.C. §611 (b)); 

-- APCAC is comprised of member American 

Chambers of Commerce or American business 

groups (AMCHAM's) located in and having 

their principal place of business in ten countries; and 

-- APCAC's budget is provided by its member 

foreign principals. 

Since the statutory prohibition against electionconnected contributions by foreign national is 

unqualified, APCAC and the member organizations providing its budget may not establish a 

"separate segregated fund," as defined in 2 

U.S.C. §441b(b)(2)(C). 

AO 1977-54: Candidate Participation in 

Petition Drive 

Newt Gingrich, candidate for the U.S. House of 

Representatives, may participate as chakman of 

a petition drive in Georgia (to stop ratification 

of the Panama Canal Treaties) without expenses 

incurred in connection with this drive being 

considered contributions to or expenditures on 

behalf of his campaign for Federal office provided certain conditions are met. Expenses for 

newsletters, mass mailings, newspaper, radio and 

television advertising and public appearances 

where Mr. Gingrich is identified as chairman of 

the drive will not be contributions provided: 

·- Such activities do not involve the solicitation, 

acceptance or making of contributions to Mr. 

Gingrich's campaign; and 

-- Such activities do not involve any communication which advocates Mr. Gingrich's nomination or election to Federal office or the 

defeat of any other candidate for Federal 

office. 

AO 1977-56: Preserving Anonymity for 

Contributors to Separate 

Segregated Funds 

The custodian of employees' contributions 

solicited (under the twice-yearly provisions of 2 

U.S.C. §441b) by SAFEPAC, the political 

action committee of the Western Company of 

North America, may also be the treasurer of 

SAFEPAC provided he/she preserves the 

anonymity of contributors and files the required 

reports. A custodian who serves as treasurer is 

subject to all the responsibilities of a treasurer 

under the Act and may not participate in the 

decision-making processing whereby the separate 

segregated fund makes contributions and expenditures. The custodian-treasurer may not disclose to a company accountant or an outside 

auditing firm the records of persons making a 

single contribution of $50 or less or multiple 

contributions aggregating $100 or less in a 

calendar year. The custodian-treasurer could, 

however, disclose to either a company accountant or outside auditing firm those records 

required with respect to single contributions 

exceeding $50 in a calendar year or contributions from an individual which aggregate over 

$100 in a calendar year. 

AO 1977-57; Termination of 

1972 Committee 

The 1972 Campaign Liquidation Trust (the 

Trust) may not terminate its reporting obliga-
64 

tions under the Act. Because the Trust has 

assumed the debts and obligations of former 

Federal campaign committees, and because these 

debts and obligations have not been extinguished, the Trust must continue to report (2 

u.s.c. §434(b)(12)). 

However, some of the debts and obligations 

currently reported by the Trust are claims for 

legal fees made against the entities which established the Trust. The Trust may disallow these 

claims, in which case the Trust need not report 

them as debts or obligations. When a previously 

reported claim is disallowed, however, the Trust 

must file an amended report to reflect that 

the claim is no longer a debt or obligation. The 

Trust's reporting obligation may be terminated 

once all debts and obligations have been extinguished. 

AO 1977-58: Transfer of Candidate's 

Personal Funds 

Personal funds transferred by 1974 candidate 

Edward P. Beard to his principal campaign 

committee may not be retroactively designated 

as a loan to the committee. Since the funds were 

originally reported by the committee as a 

transfer-in (contribution), no debt or obligation 

wad disclosed. The committee, in fact, completed its activities following the 1974 elections 

with no reported debts or obligations. Subsequent contributions received and expenditures 

made by the committee were with respect to Mr. 

Beard's candidacy in 1976. To redesignate a 

transfer from 1974 as a debt or obligation of the 

committee would not be in accordance with the 

Act (2 U.S.C. §434(b)(12)), which requires 

debts to be disclosed in a timely manner and to 

be continuously reported until they are extinguished. 

AO 1977-59: Assistant Treasurer May Assume 

Treasurer's Duties · 

The treasurer of AICPA Effective Legislation 

Committee (the Committee) may designate an 

assistant treasurer to serve in his absence provided the Committee first files an amendment to 

its Statement of Organization identifying the 

assistant treasurer. In this case, the assistant 

treasurer may assume all the duties and responsibilities of the treasurer, including the duty to 

sign required reports. 

AO 1977-61: Joint Fundraising 

The Colorado State Democratic Central Com· 

mittee (CDC) may engage in joint fundraising 

with the People for Haskell committee (PH) by 

means of a fundraising dinner sponsored by a 

third political committee authorized by both 

CDC and PH. 

This political committee, Dinner with the Vice 

President Committee (DVPC), may conduct the 

fundraising event, provided certain additional 

requirements detailed by the Commission are 

met, including: 

-- Written authorization of DVPC must be made 

by CDC and PH. 

-- All committees must comply with the Act's 

provisions: recordkeeping, reporting and contribution limitations, among others. 

A procedure must be established whereby 

contributors may designate their contributions to one (or the other) of the two committees. All other contributions will be 

equally divided between PH and CDC, as 

agreed prior to the event. 

Solicitations must inform contributors of 

the procedures for making contributions to 

the committee, including a description of 

the method for directing contributions to 

one of the other two committees. 

Expenses must be shared in the same ratio 

as the allocation of contributions received. 

If not, the committee paying a disproportionate share of expenses is considered to 

have made an in-kind contribution to the 

other committee. 

The Commission also provided detailed guidance 

to the three committees on procedures for 

reporting the contributions received, as well as 

for reporting the transfer of funds from DVPC 

to CDC and PH. 
65 

AO 1977-63: Use of Excess 

Campaign Funds 

Congressman Paul G. Rogers may use excess 

campaign funds from a 1968 congressional 

campaign for his campaign for reelection in 

1978. The 1968 funds, if used in the 1978 

campaign, must be included in the cash-on-hand 

of Congressman Rogers' 1978 principal campaign committee. The committee must also 

identify any individual contributor of more 

than $100 on a separate Schedule A, specifically 

designated for this purpose. These individuals 

are not considered to have made a contribution 

for limitation purposes under the Act, but they 

must be identified for disclosure purposes. 

The excess campaign funds may also be used for 

other purposes described in the Act and regulations at 2 U.S.C. §439a and 11 CFR 113.2, 

respectively. 

AO 1977-64: Use of Excess 

Campaign Funds 

The distribution of excess campaign funds by 

Margaret Costanza, former candidate for Congress, to the American Cancer Society and Camp 

Haccamo is expressly made lawful by 2 U.S.C. 

§439a, if those organizations are qualified 

charities under 26 U.S.C. § 170(c). 

AO 1977-65: Transfer of Funds 

from Connected Organization 

The political committee Americans for Democratic ActionProgressive Victory Fund (ADAPVF) may not accept contributions from its 

connected organization, Americans for Democratic Action-Michigan Chapter (ADA-MC). 

Because ADA-MC derives a portion of its funds 

from the sale of advertising or fundraising 

tickets to corporations and labor organizations, 

contributions by ADA-MC to ADA-PVF would 

constitute prohibited indirect corporate or labor 

contributions to a political committee. As 

ADA-PVF acknowledged that it had already 

received such contributions from ADA-MC, the 

Commission required that the monies be returned. ADA-PVF must also give the Commission 

written notice when the funds have been returned. 

AO 1977-66: Use of Committee's 

List of Contributors 

The Title Industry Political Action Committee 

(TIPAC), a multicandidate committee, may use 

a list of 1977 contributors to TIPAC for its 

1978 solicitation campaign. Even though the list 

duplicates information submitted on TIPAC's 

reports to the Commission, the list was compiled by TIPAC from its own information. 

Moreover, TIPAC's use of its own contributor 

list for its own solicitation program by its own 

agents (a committee of State advisory trustees) 

does not involve the kind of "commercial 

purpose" prohibited in 2 U.S.C. §438(a)(4). 

AO 1977-67: Solicitation of "Members" 

The Public Service Research Council (PSRC) and 

its political action committee (PAPAC) may 

solicit contributions from certain persons PSRC 

claims as its members if they satisfy four conditions defined by PSRC and two additional 

criteria established by the Commission. Under 

the conditions defined by PSRC, the member 

must have: 

-- Expressed "a specific and unambiguous desire 

to become, or join as, a member of PSRC" by 

writing to PSRC or returning a card expressing that desire; 

-- Been given the right to participate in a membership survey at least once a year; 

-- Paid dues or contributions to PSRC on a regular basis; and 

-- Renewed membership status in PSRC at 

periodic intervals. 

The opinion concluded that these four conditions are "sufficient indicia of a membership 

relationship" to permit solicitation by PSPAC 

provided two additional conditions are met: 

1. Dues or contributions must be set at a predetermined amount; and 

2. Any waiver of dues or contributions must be 

made in accordance with predetermined 

criteria. 
66 

The opinion does not address the possibility of 

soliciting other persons also considered by PSRC 

to be members (but who do not meet all of the 

above criteria); nor does the opinion address the 

issue of membership status for any person whose 

dues or contributions have been waived. 

AO 1977-68: Federal Candidate May Be 

Employed by Bank 

Peter Cooke, a Fedoral candidate, may fulfill the 

terms of his employment contract with Tracy 

Collins Bank and Trust (the Bank) without the 

compensation being regarded as a contribution 

or expenditure, provided that " ... a bona 

fide employment relation exists between the 

parties for purposes genuinely independent of 

Mr. Cooke's candidacy and that any compensation paid by the Bank to Mr. Cooke is exclusively in consideration of services performed by 

him as the Bank's legislative lobbyist." Mr. 

Cooke's contract states, among other provisions, 

that he will: devote a minimum of 40 hours a 

week to serving as legislative lobbyist for the 

bank; not count, as part of his minimum work 

week, time spent in connection with personal 

political activity; keep available for Bank inspection a log of political campaign-related phone 

calls made from Cooke's office at the Bank; 

and promptly reimburse the Bank for the cost, 

including added overhead, of any "occasional, 

isolated or incidental" use of Bank facilities in 

connection with personal political activity. 

AO 1977-70: Corporate Solicitation 

of Licensees 

The McDonald's Corporation (the Corporation) 

or its political action committee may solicit 

contributions from the executive and administrative personnel of McDonald's incorporated 

licensees. Because of the Corporation's"... continuing control and direction over the business 

policies, practices and procedures of its licensees, as well as the nature and extent of the 

licensees' contractual obligation to the Corporation ..." the Iicensees are considered to be 

affiliates of the Corporation. All separate 

segregated funds established by licensees are 

subject to the anti-proliferation provisions of the 

Act and the Commission's regulations (11 CFR 

110.3) and would share contribution limits with 

McDonald's PAC. 

AO 1977-71: Solicitation by 

Trade Association 

The American Institute for Shippers' Association, Inc. (AISA), upon receipt of solicitation 

permission (11 CFR 114.8(d)) by member 

cooperatives, may solicit the execu-tive and 

administrative personnel of management corporations retained by these member cooperatives. 

Because the management corporations are 

formed for the specific purpose of fulfilling the 

executive and administrative functions of the 

member cooperatives of AISA and because they 

do not engage in any other activity, the executive and administrative personnel of the 

management corporation may be regarded 

as the executive and administrative personnel of 

the member cooperatives of AISA. 

AO 1978-1: Retirement of 

Past Campaign Debts 

Contributions to the Democratic National Committee (DNC) to retire debts incurred in connection with elections held prior to January 1, 

1975, are not subject to the contribution 

limits of the Act. 

The conditions for acceptance of such unlimited 

contributions set forth in the opinion were 

originally stated in several 1975 and 1976 

advisory opinions and also codified in the 

Commission's regulations at 11 CFR 110.1(g). 

The contributions, however, must be clearly 

designated and used only for that purpose. Any 

solicitation for such contributions must contain 

a clear notice that the contributions will be used 

to retire a pre-1975 debt. 

The DNC must also maintain a separate account 

to receive such contributions and to make 

expenditures to retire the pre-1975 debts. 

Transfers between this account and other DNC 

accounts are prohibited. The DNC must keep 

records for and report all contributions and 

expenditures in connection with the retire-
67 

ment of the pre-1975 debts in accordance with 

the currently applicable provisions of the Act 

and regulations. This includes reporting the 

outstanding obligations on a separately designated Schedule C and, when itemization is 

required, reporting each contribution designated 

for the pre-1975 debt on separately designated 

Schedule A's. 

AO 1978-2: Expenditure by Political 

Campaign Committee 

The principal campaign committee of Congressman Butler Derrick may pay the expenses 

incurred by the Congressman and his wife 

when attending the Democratic National Committee's "Southern Salute to Jimmy Carter." In 

past opinions, the Commission has stated that it 

leaves to the candidates (or their committees) 

the discretion of deciding which expenditures 

will best serve their candidacies. The expenditure must, of course, be reported in accordance 

with the applicable provisions of the Act and 

regulations. 

AO 1978-3: Reimbursement by Principal 

Campaign Committee 

The principal campaign committee of Congressman Gillespie V. Montgomery may reimburse 

him for the purchase of Christmas gifts in 1977. 

The Congressman considers the cost of the gifts 

to be legitimate campaign expenditures. The 

principal campaign committees must report the 

reimbursement as an expenditure to the person 

or business from whom the Congressman purchased the Christmas gifts. The report must also 

note that the actual disbursement of funds was 

made to the Congressman. Mr. Montgomery 

must provide the committee with a receipted bill 

from the vendor in accordance with 2 U.S.C. 

§432(d) and 11 CFR 102.9(c). The Commission 

expressed no opinion as to the applicability of 

House Rules to the proposed reimbursement, 

because these Rules are outside the Commission's jurisdiction. 

AO 1978-4: Commemorative. Committee 

The John Rhodes Commemorative Committee is 

not required to register and report as a political 

committee for a commemorative dinner held to 

honor Congressman John Rhodes for the following reasons: 

-- The dinner is a nonprofit, nonpartisan event; 

and 

-- The event is not for the purpose of influencing Mr. Rhodes' nomination or election to 

Federal office. 

The dinner is considered a bona fide testimonial 

event provided that no political contributions 

are solicited, made or received in conjunction 

with the event and that no communication is 

made to the attendees as a group which advocates the election of Mr. Rhodes or the defeat of 

any other candidate. 

AO 1978-5: Payment of Candidate's 

Living Expenses 

Herbert Creech, candidate for the U.S. House of 

Representatives, may use campaign funds to pay 

for his ordinary and necessary living expenses 

during his campaign for Federal office. The 

Commission has held in several past advisory 

opinions that candidates and their committees 

" ... have wide discretion under the Act in 

deciding which expenditures will best serve their 

candidacies." Expenditures for such living 

expenses paid out of a campaign account would, 

of course, be reportable under the Act. The 

Commission has no jurisdiction over possible tax 

ramifications of such expenditures. 

AO 1978-6: Payment of Compensation 

to Candidate 

Norman G. Gaar, candidate for the U.S. Senate, 

may continue to receive compensation from his 

law firm without such compensation being 

considered a contribution provided: 

-- A bona fide employment relation exists 

between Mr. Gaar and the law firm; 

-- Compensation paid to Mr. Gaar is "exclusively in consideration of employment services performed by him"; and 

-- Compensation is paid to Mr. Gaar " ...according to the same compensation scheme follow-
68 

ed by (Mr. Gaar) and the firm prior to the 

onset of (his) candidate status." 

For instance, the number of law firm hours 

worked is apparently a factor in fixing Mr. 

Gaar's compensation. A contribution by the 

firm will not occur unless his compensation is 

not decreased to reflect any decrease in the 

number of hours worked for the firm because of 

his campaign. Such a contribution would be 

subject to limitations and must be reported in 

accordance with the Act and regulations. 

AO 1978-7: Contribution from 

an Estate 

The Jim Guy Tucker for Senate Campaign 

Committee must report the portion of a partnership contribution allocable to two decedents' 

estates as " ... contributions from the living 

beneficiaries of those estates according to their 

interest in the estate under relevant testamentary and trust instruments." The contributions 

may be allocated in this manner only if such 

beneficiaries can make a "knowing and voluntary decision to contribute" and the contribution is otherwise legal under the Act. In the 

alternative, the contribution may be allocated 

by the partnership among only the living partners in accordance with the Commission's 

regulations at 11 CFR 110.1 (e). 

AO 1978-9: Activities of 

Party Organization 

For purposes of the contribution limitations, the 

Republican State Central Committee of Iowa 

(State Committee) is a separate political committee from the various county central committees (County Committees) in the State which 

qualify as "political committees" under the Act 

and regulations. The conclusion is based on the 

facts submitted by the State Committee that: 

-- Contributions by the County Committees to 

candidates for Federal office are "not made 

in cooperation, consultation, or concert with, 

or at the request or suggestion of, the State 

Committee..."; 

The County Committees receive no funds 

(other than proceeds of joint fundraising) 

from the State Committee; 

-- The County Committees are created by 

statute and not established, financed, maintained or controlled by the State Committee; and 

-- Each County Committee elects its own 

officers and adopts its own constitution 

and bylaws. 

Therefore, because they are separate political 

committees, contributions to or by the State 

Committee and the County Committees are not 

aggregated under one contribution limitation. 

The party's auxiliary bodies (e.g., Federation of 

Republican Women, Young Republicans, College 

Republicans), which are "political committees" 

as defined by the Act, are not, however, considered separate committees for purposes of the 

contribution limitations. Provisions in the State 

statutes and State Committee's bylaws provide 

for the establishment of these auxiliary bodies. 

They also coordinate their activities and finances 

with the State Committee. Therefore, contributions by the auxiliary bodies are subject to the 

limitations which govern State Committee 

activity. 

County committees or auxiliary bodies which 

are not "political committees" as defined in the 

Act, may make contributions up to $1,000 in a 

calendar year to candidates for Federal office 

without incurring any obligation to register or 

report. Any such contributions must be lawful 

under the Act. In this case, however, because 

the party units are not "political committees," 

contributions to or by the party units do not 

count against the limitations of or need be 

reported by the State Committee. The State 

Committee's limitations would apply and a 

reporting obligation would occur only if: 

-- The party unit becomes a "political committee" which is established, financed, maintained or controlled by the State Committee; 

or 
69 

-- The unit is a fundraising agent for the State 

Committee. 

The Act's provision for a special party expenditure limitation (2 U.S.C. §441a(d)) gives only 

one shared limitation to the entire State party 

organization. Thus, individual party units (such 

as county committees or auxiliary bodies) do 

not each have a limit separate from the State 

Committee. The regulations set out alternative methods for the administration of this single 

State party limitation and the requirements for 

reporting this activity. 

The special $1,000 coordinated spending limitation for party committees (11 CFR 110.7(b)(5)) 

is available. for use only in connection with the 

general election for Presidential candidates. 

Therefore, it may not be used in connection 

with the 1978 general election. 

Under certain conditions, the Act exempts from 

the definition of contribution and expenditure 

the costs of a slate card, sample ballot or "other 

printed listing" prepared by a party committee. 

The slate cards may include information identifying candidates by name, office or position 

currently held, office sought and party affiliation. They may also include certain other 

voting information. Pictures of the candidates 

may be used for identification purposes. 

However, additional biographical information or 

material on the candidates' or party's philosophy or positions on issues is not permissible. 

Materials which qualify under this provision 

may be distributed in direct mass mailings. 

AO 1978-10 (Part A): Allocation of 

Party Expenses 

The Republican State Committee of Kansas (the 

Committee) should allocate expenses of registration and get-out-the-vote drives between Federal 

and non-Federal elections in the same manner as 

other general party expenditures (11 CFR 

106.1(c) & (e)). The portion of the expenses 

allocable to Federal candidates must be paid 

from funds contributed in accordance with the 

Act. Those costs which are allocated to nonFederal elections may be paid out of funds 

contributed in accordance with Kansas State 

law, including, if applicable, funds contributed 

by corporations or labor organizations. NOTE: 

This conclusion modifies and supercedes the 

Commission's responses to Advisory Opinion 

Requests 1976-72 and 1976-83. 

Expenditures made for the Committee's drives 

need not be considered contributions to a 

particular candidate for Federal office unless the 

drives are made specifically on behalf of such 

candidate. 

The Committee may use printed materials (such 

as slate cards or sample ballots) in connection 

with the drives which identify candidates for 

Federal office. The costs of such materials 

would not be considered contributions or have 

to be allocated to candidates provided the 

materials were prepared in accordance with the 

slate card or sample ballot exemption in the Act 

(2 U.S.C. §431 (e)(5)(E) and §431 (f)(4)(G) ). 

AO 1978-12: Multicandidate 

Committee 

Friends of Congressman Henry A. Waxman (the 

Committee), political committee, may operate 

as a multicandidate committee for purposes of 

the contribution limits, provided: 

-- The Committee qualifies as a multicandidate 

committee under the Act (2 U.S.C. §441 a(a) 

(4)); and 

-- Congressman Waxman does not authorize the 

Committee in writing to solicit or receive contributions on his behalf. 

Even though Congressman Waxman will assist in 

fundraising efforts for the Committee and will 

participate in the selection of candidates to 

·receive contributions, if the two conditions 

above are met, the Committee " ... will not 

be considered one of (Congressman Waxman's) 

authorized committees, and contributors to the 

Committee will not be regarded as making 
70 

contributions with respect to Congressman 

Waxman's 1978 House campaign." Once qualified as a multicandidate committee, the Committee may make contributions up to $5,000 

per candidate, per election. 

AO 1978-13: Payment of Expenses 

in Connection With 

Separate Segregated Fund 

Corporate members of the Aluminum Association (the Association) may not pay the travel 

expenses of five representatives of member 

corporations who traveled to Washington, D.C. 

to formally organize and establish the Association's separate segregated fund (AAPAC). Such 

expenses would constitute "establishment" and 

"administration" costs which must be paid by 

the Association. Any payment by a member 

corporation would constitute a prohibited 

corporate contribution to AAPAC. 

However, when other AAPAC meetings, occurring after the initial organization meeting, 

coincide with regular Association meetings, and 

the costs incurred in connection with the 

AAPAC meeting are incidental to the expenses 

of attending the Association meeting, the 

member corporations may pay those incidental 

expenses without being considered to have made 

a prohibited contribution. These incidental 

expenses include the travel expenses of the 

corporate-member representatives attending 

both the Association and AAPAC meetings. 

AO 1978-15: Candidate Participation 

in Charity Drive 

Vic Fazio, a candidate for the U.S. House of 

Representatives, may participate as Honorary 

Chairman in a fundraising campaign for the 

Sacramento unit of the American Cancer 

Society. 

The costs of the publicity and brochures used in 

connection with the drive would not be considered a contribution to or an expenditure on 

behalf of Mr. Fazio's candidacy because the 

major purpose of the drive is not to influence 

the nomination or election of a candidate to 

Federal office and, additionally, because: 

-- Mr. Fazio agreed to participate as chairman 

before he became a candidate for Federal 

office; 

-· Mr. Fazio " ... presumably will not control 

or have any role in deciding the distribution 

to be made of brochures and letters bearing 

his picture and name"; 

-- The brochures and letters will not contain any 

reference to Mr. Fazio's candidacy for Federal 

office. 

Commission approval of the opinion was also 

conditioned on an assumption that all other 

activities in connection with the drive will 

not involve solicitation or acceptance of contributions in connection with Mr. Fazio's campaign 

or communications expressly advocating his 

election (or the defeat of any other candidate). 

AO 1976-16: Payroll Deduction Program 

The Whirlpool Corporation's political action 

committee (WPAC) may use an open-ended 

payroll deduction program for its executive and 

administrative personnel to make contributions 

to WPAC. The employee's signed authorization 

will not, in itself, be considered a contribution 

because: 

1. The authorization may be terminated at any 

time; and 

2. No certain total amount may be identified. 

The authorization does not constitute a contract, promise or agreement (2 U.S.C. §431 (e) 

(2); 11 CFR 100.4(a)(3)}. Thus, it is not reported as a debt owed to WPAC. WPAC must, 

however, disclose (on FEC Form 3) each contribution made when the payroll deduction is 

actually made and the proceeds are remitted to 

WPAC. Contributions from one donor aggregating in excess of $100 during a calendar year 

must be itemized. 

The Commission noted, however, that authorization of a payroll deduction to a committee 

would constitute a contribution if the executive 

or administrative employee making the authori-
71 

zation " ... specified ... that it would be 

effective over a definite period of time...." The 

committee's obligation to itemize such a contribution on it's report would arise from the 

authorization itself if the total amount of the 

promised contribution (by itself or when aggregated with other contributions by the same 

donor) exceeded $100 during a calendar year. 

AO 1978-17: Solicitations by 

Trade Association 

The National Cable Television Association 

(NCTA) may conduct solicitations for its 

separate segregated fund (CABLEPAC) on the 

exhibit floor at its annual convention provided 

certain conditions are met. NCTA may set up a 

booth for the purpose of selling T-shirts, caps 

and buttons to raise funds for CABLEPAC 

provided that: 

-- Only persons who may be properly solicited 

by NCTA under the Act and Commission's 

regulations (2 U.S.C. §441b, 11 CFR 114.8) 

will purchase the items in the booth, thus 

making a contribution to CABLEPAC; 

-- Existence of the booth will not be publicized 

prior to or during the convention; 

-- Signs will be posted on the booth itself to 

inform potential contributors of the restrictions on who may contribute; 

-- Funds from persons who are employed by 

nonmember corporations of NCT A or by 

member corporations who have not given 

the requisite approval will not be accepted; 

-- CABLEPAC maintains records of each purchase including the amount and type of 

purchase and the company affiliation of each 

purchaser. 

At the same convention, NCTA may orally seek 

to obtain permission for solicitations from 

member corporations who have not given such 

permission, provided " ... the actual request 

for approval is made in writing" in accordance 

with the Commission's regulations at 11 CFR 

114.8(d)(3). 

Approval to conduct solicitations must also be 

made in writing before such solicitations may be 

made. 

AO 1977-18: Distribution of Publication 

to Members of Congress 

The Chamber of Commerce may distribute a 

single copy of its publication "How They 

Voted" to each Member of Congress. Because 

the publication will be distributed to all Members, without regard to their status as a candi· 

date for Federal office, and because the limited 

distribution shows " ... no evident purpose to 

influence Federal elections ..., " the costs of the 

publication will not constitute a prohibited use 

of corporate treasury funds (2U.S.C. §441b). 

The distribution of the publication to other 

nonmembers of the Chamber, however, would 

constitute an unlawful use of corporate funds 

since the publication was financed from the 

treasury funds of the Chamber. 

AO 1978-19: Contributions to 

Two Committees for 

the Same Candidate 

Congressman Donald Fraser may regard contributions to the Minnesota Fraser Committee 

(Senate 1) as separate and distinct from contributions made to the Fraser Senate Committee 

(Senate 2). The Senate 1 committee supported 

the Congressman's campaign for the U.S. Senate 

for the term ending in 1984, while the Senate 2 

committee is currently supporting the Congressman's campaign for the U.S. Senate for the 

term ending in 1982. The election for both the 

1982 and 1984 Senate seats will be held in 

November 1978. 

Because the Senate 1 committee is now terminated and because it's efforts were for a separate 

Federal office, contributions to it "need not be 

aggregated with those made to the 'new' Senate 

2 committee ...." Contributions to the two 

committees would have to be aggregated only 

if contributions made to the Senate 1 committee 

were transferred, directly or indirectly, to the 

Senate 2 committee under 2 U.S.C. §441a(a) 

(S)(C). Such contributions transferred from the 
72 

Senate 1 committee would have to be attributed 

to the original donors, and aggregated for 

purposes of determining the $100 disclosure 

threshold and for contribution limitation purposes. 

AO 1978-20: Use of 

Corporate Aircraft 

Robert Davis, candidate for the U.S. House of 

Representatives, may use an aircraft owned by a 

nonprofit corporate flying club for campaignrelated travel provided he reimburse the flying 

club in advance in accordance with § 114.9(e) of 

the Commission's regulations. An individual 

member of the club may use the club's aircraft 

in connection with campaign-related travel as a 

volunteer "providing personal services to the 

campaign." However, the member of the campaign committee would have to reimburse the 

flying club in accordance with § 114.9(e). 

If made by the club member, the total reimbursement could not exceed the combined total 

limits contained in 2 U.S.C. §431 (e)(5)(1) 

(travel expenses of individual volunteering 

services to campaign exempted from definition 

of contribution) and 2 U.S.C. §441a (individual 

contribution I imitations). 

The opinion noted the possible application of 

other laws or regulations outside the Commission's jurisdiction, particularly regulations of the 

Federal Aviation Administration. 

AO 1978-21: Separate Segregated Fund of 

Foreign-Owned Corporation 

The Budd Company (the Company) may continue to administer its separate segregated fund 

(the Committee) after becoming a wholly-owned 

subsidiary of Thyssen, A.G., a West German 

corporation. Because the Company will retain its 

autonomous corporate form (as a Pennsylvania 

corporation) and its principal place of business 

will remain in the United States, the Company 

will not be considered a "foreign national" 

which, under the Act, is prohibited from making 

contributions in connection with Federal 

elections (2 U.S.C. §441e; 11 CFR 110.4(a)). 

The conclusion was based on several assumptions: 

-- Contributions to the Committee are not 

solicited or accepted from foreign nationals; 

-- Solicitations for the Committee and contributions or expenditures made by the Committee 

are in accordance with the Act and regulations; 

-- Individuals exercising decision-making authority in the Committee are citizens of the 

United States (or, lawfully admitted for 

permanent residence); 

-- Decisions made by those individuals are not 

"dictated or directed by personnel of 

Thyssen, A.G. or any other foreign corporation, who are foreign nationals." 

AO 1978-22: Hospitality Suite Maintained 

by Candidate 

The cost of maintaining a "hospitality room" at 

the State Convention of the Democratic Party of 

Hawaii by Congressman Cecil Heftel, a candidate 

for the U.S. House of Representatives, would 

constitute an expenditure subject to the disclosure provisions of the Federal Election 

Campaign Act. Funds donated to the Congressman to defray the costs of maintaining such a 

room would be contributions under the Act. 

This conclusion is based on several factors: 

-- Mr. Heftel's appearance at the convention 

would be before "a substantial number of 

people who comprise a part of the candidate's 

electorate ..."; 

-- The State party convention is inherently a 

partisan event at which decisions will be made 

affecting both the primary and general elections; and 

-- Mr. Heftel's attendance at the convention and 

maintenance of a hospitality suite is likely to 

"have the effect of furthering (his) candidacy." 

AO 1978-23: Payroll Deduction Plan 

The Square D Company may facilitate a method 

of collecting political contributions by the Inter-
73 

national Association of Machinists (lAM) whereby members of JAM authorize payroll deductions of contributions to JAM's separate segregated fund (Machinists Nonpartisan Political 

League). Square D Company may facilitate this 

plan even though the company itself does not 

utilize a payroll deduction system to facilitate 

political contributions from executive employees to its own separate segregated fund. 

AO 1918-24: Preemption of 

State Law 

The Sonneland for Congress Committee does 

not have to comply with a Washington State 

statute which requires campaign advertising 

to disclose the party affiliation of the candidate 

involved. This portion of the Washington law is 

preempted by the Federal Election Campaign 

Act because: 

-- Sponsorship statements and notices of the 

availability of campaign finance reports on 

campaign advertising " ... are an integral part 

of the scheme prescribed by the Act for 

effective full disclosure"; and 

-- The Act preempts any State law with respect 

to "required disclosures in conducting political campaigns for Federal office." 

AO 1978-25 (Part A): Contributions for a 

Primary Runoff 

Election 

Congressman Thad Cochran and Senator Jesse 

Helms, candidates for the U.S. Senate in Mississippi and North Carolina, respectively, may not 

benefit from a separate contribution limitation 

for a primary runoff election in which they are 

not on the ballot. Even though a runoff is 

required for Senate candidates seeking the 

nomination of another political party, a candidate who has already been nominated through 

a primary election victory is "no longer seeking 

nomination and therefore is not regarded as a 

candidate with respect to any runoff election ... 

to select another nominee for the same Federal 

office." Contributions with respect to a potential runoff may not be made or accepted and 

then held in escrow with a view toward spending 

them in the event a runoff becomes necessary. 

AO 1978-25 (Part B): Conventions as Elections 

Neither the Colorado nor Minnesota political 

party convention is considered a separate 

election for purposes of the Federal Election 

Campaign Act. Under the Act, a convention is 

considered a separate election (from the primary 

and general) only if it "has the authority to 

select a nominee ...." Under Colorado and 

Minnesota State Jaw, political party conventions 

do not have this authority. Rather, their authority is limited to designating or endorsing party 

candidates to run in the party primary. Therefore, candidates participating in the conventions 

do not have a separate contribution limitation 

with respect to the convention. 

AO 1978-26: Stockholder Solicitation 

Through Conduits 

Citicorp's separate segregated fund, Citicorp 

Employees Voluntary Political Fund (the Fund), 

may deliver solicitation materials to stockholders through conduits (e.g., brokers, dealers, 

banks or other nominees) who hold stock for 

the beneficial owners provided: 

-- Any solicitation by the Fund is intended 

exclusively for and speaks only to those persons falling within the definition of "stockholder" in the Commission's regulations (11 

CFR 114.1 (h)); and 

-- The stockholders would otherwise be qualified to make contributions under the Act. 

AO 1978-27: Executive and Administrative 

Personnel 

The Morrison Political Action Committee 

(MPAC) may solicit voluntary contributions 

from certain unit managers of Morrison Incorporated (its connected organization) and its 

subsidiaries. These unit managers may be solicited as executive and administrative personnel 

because of their authority and functions within 

Morrison Incorporated. For example, they: 

-- Are paid on a salaried rather than hourly basis 

and receive a bonus based on the performance 

of their unit; 
74 

-- Have management and supervisory authority 

over a substantial number of employees 

including complete control of hiring, firing, 

discipline and promotion; 

-- Have independent authority to implement the 

policies and directives of Morrison Incorporated and discretionary authority over day-today operations; 

-- Function as a unit manager on a continuing 

basis and are eligible for promotion to higher 

level supervisory positions. 

AO 1978-28: Party Get-Out-The-Vote Drive 

The Washoe County Republican Party Committee (the Committee) of Nevada may conduct a 

get-out-the-vote drive in connection with the 

general election on behalf of State and local 

candidates. 

However, because it is a Federal election year, 

the expenses for the drive are considered to 

be made, in part, for the purpose of influencing 

the election of a person to Federal office. They 

must be allocated on a reasonable basis (11 CFR 

106.1) betwen expenditures made to influence a 

Federal election and those which are made to 

influence a State or local election. That portion 

of the expenses which would be attributable to a 

Federal election must be paid from funds which 

are lawful under the Act. 

Since the Committee does not anticipate that 

the portion of the funds attributable to a 

Federal election will exceed $1,000, the Committee will not be required to register and report 

as a "political committee" under the Act. 

Furthermore, because the drive will not identify 

any ''clearly identified" candidate for Federal 

office, the expenditures attributable to Federal 

elections are not considered contributions to or 

expenditures on behalf of any specific candidate 

for Federal office. 

AO 1978-29: Requirements of 

Authorized Committee 

A nonprincipal campaign committee authorized 

by Congressman Ted Weiss (the Committee) 

which does not anticipate receiving contributions or making expenditures in excess of 

$1,000 during a calendar year would not be a 

"political committee" as defined in the Act. 

Congressman Weiss would not have to file FEC 

Form 2a (on which a candidate authorizes 

a "political committee" other than a principal 

campaign committee). The Committee would 

not have to register under the Federal Election 

Campaign Act; nor would it be required to file 

reports of receipts and expenditures with the 

principal campaign committee of Congressman 

Weiss. 

However, because the Committee's activities are 

to influence the election of Congressman Weiss 

to Federal office, " ... all contributions received 

and expenditures made (by the Committee) are 

regarded as received and made by the authorizing candidate and his principal campaign committee." Therefore, either the candidate or his 

principal campaign committee would be responsible for keeping the records and filing the 

reports required by the Act on the Committee's 

activities. 

AO 1978-30: Utah Convention 

as Election 

Edwin Firmage, candidate for the U.S. House of 

Representatives, may not receive contributions 

with respect to each of three separate elections 

in the State of Utah unless: 

1. Under Utah State Law, he is one of two party 

nominees at the State party convention 

eligible to run in a subsequent primary election; and 

2. Mr. Firmage receives the greatest number of 

votes in the primary and is thus the party's 

nominee in the general election. 

In this case, an individual could contribute up to 

$1,000 with respect to each of the three elections: the convention, the primary election and 

the general election. 

However, if Mr. Firmage is unopposed at the 

convention or he receives at least 70 percent of 
75 

the vote at the convention and thus directly 

becomes the party's nominee for the general 

election, only two contribution limitations 

would apply: one for the convention and one 

for the general election. 

This opinion supercedes AO 1975-54, which was 

published in the Federal Register on December 

18, 1975 (40 FR 58802). 

AO 1978-32: Payments for Appearances 

by Officeholder 

Senator Herman Talmadge may accept, as 

honoraria, payments from individuals or separate segregated funds for appearances he makes 

before them. Such payments would not be 

considered contributions to Mr. Talmadge's 

campaign for reelection. As honoraria, however, 

the payments would be subject to the limitations in 2 U.S. C. §441 i. 

As a general rule, payments made to Senator 

Talmadge's principal campaign committee (the 

Committee) " ... may be treated as contributions when the sponsor making the contribution 

states that it is for the purpose of supporting 

Senator Talmadge's reelection and is not a 

payment (honorarium) for the Senator's appearance." As contributions, the payments are 

subject to the limitations and reporting provisions of the Act. 

Without specific facts, the Commission would 

not conclude categorically that all receipts 

regarded by the Committee as contributions are 

not honoraria. The Commission has no jurisdiction over any possible application of Senate 

Rules or tax laws to the situations described. 

AO 1978-33: Statements on 

Advertising 

RobertS. Allen, candidate the the U.S. House of 

Representatives, must include the required 

statements of campaign authorization and report 

availability on newspaper advertisements which 

advocate the defeat of his opponent and solicit 

contributions to Mr. Allen's campaign, regardless 

of how "terse or cryptic" the ads may be. 

2 U.S.C. § §435(b) and 441 (d). Because the ads 

appeared in a newspaper, which is one of the 

five specific methods of "general public political 

advertising" mentioned in the Act, the campaign 

authorization statement must appear. 

In addition, the notice on campaign report availability must appear on"... all printed literature 

and advertisements soliciting contributions ..." 

regardless of size. 

AO 1978-34: Use of Business Phones 

by Candidate 

The Citizens for Downey '78 Committee (the 

Committee) may use corporate or noncorporate 

business telephones for its campaign activity 

instead of establishing the Committee's own 

phone bank. However, the Committee must 

reimburse the businesses, within a reasonable 

time, for the normal and usual rental charge of 

such facilities. If not reimbursed, the businesses 

are considered to have made an in-kind contribution. 

Normal and usual rental charge is considered the 

cost of renting the phones in the normal market, 

" ... including the costs for the use of office 

space, utilities and furniture to conduct the 

telephoning." Therefore, the Committee may 

not use the per-call cost charged by the New 

York Telephone Company as the only basis for 

reimbursement. The difference between this 

charge and the normal and usual rental charge 

would constitute a contribution in-kind by the 

businesses to the Committee. In the case of a 

corporate business, this contribution is prohibited. An unincorporated business may make 

a contribution in-kind subject to the $1,000 per 

election limitation of the Act. 

AO 1978-35: Use of Trust Funds to 

Retire Campaign Debts 

Senate candidate Bill Waller may use funds in a 

trust set up for him in 1971 to pay primary 

debts incurred in his 1978 Senate campaign. 

Because he had access and beneficial enjoyment 

to the funds before March 1978, when he 

became a candidate, the trust is considered 
76 

"personal funds" and, thus, is not subject to 

contribution limitations. Any interest accruing 

on the trust is also considered personal funds. 

AO 1978-36: Activities of Separate 

Segregated Fund 

The National Nutritional Foods Political Action 

Committee (NNFPAC), the separate segregated 

fund of a trade association, is not prohibited by 

the Act from spending funds to influence 

legislative action on particular issues. NNFPAC 

may also use its voluntary contributions to 

communicate with the general public on legislative issues provided the communications do 

not solicit contributions to NNFPAC. Such 

expenses paid by NNFPAC must be reported as 

disbursements by the political committee. 

The Commission noted it could not address any 

possible application of the Federal lobbying 

statutes or the Internal Revenue Code to such 

activities. The Commission has no jurisdiction in 

these areas. 

AO 1978-37: Use of Excess 

Campaign Funds 

Congressman Bruce Caputo may use contributions received by the Committee to Reelect 

Congressman Bruce Caputo ( 1978 Committee) 

to retire 1976 general election debts incurred 

by the Caputo for Congress Committee (1976 

Committee). The funds transferred by the 1978 

Committee would not be considered contributions to the 1976 Committee (and, therefore, 

not subject to 1976 contribution limitations) 

provided: 

-- The contributions were originally made to 

influence Mr. Caputo's 1978 election to 

Federal office; 

-- The contributions were received by the 1978 

Committee before the date on which Mr. 

Caputo ceased to be a candidate for Federal 

office in 1978; and 

-- If the contributions were received after the 

date on which Mr. Caputo ceased to be a 

candidate, they were received before Mr. 

Caputo had sufficient funds to retire 1978 

campaign debts of his campaign for Federal 

office. 

Convention expenses allocable to Federal 

elections would not generally have to be further 

allocated to specific candidates for Federal 

office. However, allocation to specific candidates would be required if the expenditure 

was "made on behalf of a clearly identified 

candidate for Federal office to whom it could be 

directly attributed." 

The Party may also accept corporate funds for 

advertisements to be placed in a monthly party 

newsletter, provided such funds are permissible 

under State law. However, if any portion of the 

material published in the newsletter relates to 

Federal elections, then the newsletter expenses 

must be allocated between Federal and nonFederal elections. The Federal portion of the 

expenses must be paid from the Federal campaign committee of the Party. Such expenses 

would not constitute a contribution to specific 

candidates. 

If, however, the newsletter contains communications which expressly advocate the election of 

clearly identified Federal candidates, " ... the 

expenses of the newsletter attributed to those 

communications ... must be treated as general 

election expenditures of the Party under 2 

U.S.C. §441a(d)." Such expenditures must be 

paid from the Federal campaign committee of 

the Party. 

AO 1978-38: Solicitation and/or Authorization 

Statements on Envelopes 

The Paula Unruh for Congress Committee (the 

Committee) must include solicitation and/or 

authorization statements on envelopes used to 

mail contribution solicitations or on envelopes 

used for the return of contributions only if: 

-- The envelope contains on its face or back a 

solicitation for contributions; and/or 

-- The envelope contains on its face or back a 
77 

communication which expressly advocates 

the election or defeat of a clearly identified 

candidate. 

In the first case, the statement regarding availability of reports (2 U.S.C. §435(b)) must 

appear on the envelope. In the second case, the 

statement of authorization (2 U.S.C. §441d) 

must appear. If the envelope has a contribution 

solicitation and expressly advocates, then it 

must contain both statements. The mere printing of " ... the Committee's mailing address 

would under no circumstances be considered 

a communication that needed to include either 

the statement of authorization or the availability 

of campaign finance reports." 

AO 1978-39: Affiliation of Separate 

Segregated Funds 

INN/PAC, the political committee sponsored by 

the International Association of Holiday Inns, 

Inc. (the Association), and HI/PAC, the political 

committee sponsored by Holiday Inns, Inc. 

(Holiday), are affiliated within the meaning of 

the Act and regulations. The bylaws and charter 

of the Association and Holiday's policy statement indicate that Holiday has the authority to 

direct and influence in several specific ways, the 

Association and its membership who are franchisees of Holiday. Accordingly, both INN/PAC 

and HI/PAC are required to share a single 

contribution limit with regard to contributions 

they make to candidates and committees. 

Contributions made to INN/PAC and HI/PAC 

would be considered contributions to a single 

political committee. Transfers between the two 

committees would be unlimited. Both commit· 

tees must amend their Statements of Organization to identify each other as affiliated political 

committees. See 11 CFR 102.2(b)(1 ). 

AO 1978-40: Loans for Candidate's 

Personal Living Expenses 

Loans received by Ray Kogovsek, candidate for 

the U.S. House of Representatives, during the 

period when he was considering becoming a 

candidate for Federal office are considered 

contributions under the Act, even though the 

loans were used only to defray the personal 

living expenses of Mr. Kogovsek and his family. 

Funds provided to a candidate solely to defray 

personal I iving expenses are contributions unless 

the funds are the candidate's "personal funds" 

as defined in the Commission's regulations 

(11 CFR 110.10). The loans given to Mr. 

Kogovsek do not meet this definition and, 

therefore, are contributions subject to the 

limitations of the Act. The loans must also be 

reported by the Ray Kogovsek for Congress 

Committee. 

AO 1978-41: Contribution Limitations 

Gerald B. Solomon, a candidate for the U.S. 

House of Representatives, my accept contributions from an individual totaling $1,000 with 

respect to the primary election and $1 ,000 with 

respect to the general election. These limitations 

apply even though Mr. Solomon will be unop· 

posed in the New York State primary election 

on September 12. The Commission noted that, 

if Mr. Solomon's name appeared on the primary 

election ballot, he would have to file the preand post-election reports for that election, 

even though "there is no other candidate listed 

on the ballot in opposition to (him)." 

AO 1978-42: Solicitations by 

Dental Association 

The Dental Society of the State of New York 

(the Society) may solicit contributions to its 

separate segregated fund, Empire Dental Political Action Committee (EDPAC), in conjunction 

with the mailing of dues statements to the 

Society's individual members. 

Members of the Society may use a single personal check to make both contributions to 

EDPAC and pay their dues to the Society. The 

check must be made payable to the Society or 

to one of its district dental societies. Checks 

representing the combined dues payment and 

contribution may be placed in the bank account 

of the Society or district society. They may then 

remit the contribution portion to EDPAC by 
78 

means of a separate check. This conclusion was 

based on several assumptions: 

-- Contributions are regarded as "received" by 

EDPAC at the time the combined dues payment/contribution is received by the Society 

or any of the district societies. 

-- The contribution portion of the checks are 

deposited in EDPAC's depository within 10 

days after having been "received." 

-- All records of the Society's bank accounts 

into which combined dues payments/contributions are deposited are available to the 

Commission for inspection. 

-- The Society (and any district societies) must 

maintain for a specified period of time 

" ... usual and customary accounting records 

of members' dues payments and other appropriate records indicating those members who 

make political contributions in combination 

with dues payments." 

AO 1978-43: Use of Surplus 

Campaign Funds 

Upon her retirement from Congress, Congresswoman Barbara Jordan may use surplus funds 

from previous campaigns "to employ staff and 

pay the incidental expenses ... in the performance of duties which are imposed by virtue of 

having been a Member of Congress." (2 U.S.C. 

§439a; 11 CFR 113.2). The opinion noted that 

any possible application of the Rules of the 

House of Representatives or the Internal 

Revenue Code to the activity described is 

not within the Commission's jurisdiction. 

AO 1978-44: Intern Program Sponsored 

by Senator 

An annual summer intern program sponsored by 

Senator Ted Stevens of Alaska is educationally 

oriented and not campaign related. Therefore, 

funds donated to pay for travel expenses of the 

interns to Washington, D.C. are not considered 

contributions to Senator Stevens. 

Because the funds donated for air fare are not 

contributed to Mr. Stevens to support his 

activities as a Federal officeholder, they are not 

subject to and need not be reported under Part 

113 of the Commission's regulations. 

The funds are not considered to be donated for 

the purpose of supporting Mr. Stevens' activities 

as a Federal officeholder because: 

-- The funds are at no time under the dominion 

or control of Senator Stevens or his staff; 

-- The funds are donated specifically to defray 

the expenses of intern travel; 

-- A travel agency in Alaska coordinates and disburses the funds from a separate account established specifically for the purpose. 

AO 1978-45: Rate of Payment 

for Billboard 

The North Kansas City Development Company 

(the Company) will be considered to have made 

a contribution in-kind if it rents billboard space 

to Citizens for Coleman (Citizens), the principal 

campaign committee of a candidate for the 

House of Representatives, for less than the 

commercial rate for similar space. Because the 

rate proposed by the company for Citizens is 

lower than the "normal and usual charge" of the 

billboard space and because the Company does 

not routinely offer a similar discount to commercial vendors, the difference between the 

normal and usual rental charge and the discounted rate would be considered a contribution 

in-kind to the candidate. The Act prohibits 

contributions of any amount from corporations. 

AO 1978-46: Corporate Advertising in 

Connection with State 

Party Activities 

The Republican Party of Texas (the Party) may 

use corporate treasury funds (assuming such 

funds are permissible under State law) to defray 

expenses of the Republican State Convention 

(the Convention) which are not allocable to 

Federal election purposes. If any activities at the 

Convention are in connection with Federal 

elections the Convention expenses allocable to 

Federal election purposes must be paid from the 

separate Federal campaign committee of the 
79 

Party, established in accordance with the Commission's regulations at 11 CFR 102.6. Activities 

would be considered in connection with Federal 

elections if they involved: 

-- Soliciting, making or accepting contributions 

to influence the results of Federal elections; 

or 

-- Communications expressly advocating the 

election or defeat of a clearly identified candidate for Federal office. 

Convention expenses allocable to Federal 

elections would not generally have to be further 

allocated to specific candidates for federal 

office. However, allocation to specific candidates would be required if the expenditure 

was "made on behalf of a clearly identified 

candidate for Federal office to whom it could be 

directly attributed." 

The Party may also accept corporate funds for 

advertisements to be placed in a monthly party 

newsletter, provided such funds are permissible 

under State law. However, if any portion of the 

material published in the newsletter relates to 

Federal elections, then the newsletter expenses 

must be allocated between Federal and nonFederal elections. The Federal portion of the 

expenses must be paid from the Federal campaign committee of the Party. Such expenses 

would not constitute a contribution to specific 

candidates. 

If, however, the newsletter contains communications which expressly advocate the election of 

clearly identified Federal candidates, " ... the 

expenses of the newsletter attributed to those 

communications ... must be treated as general 

election expenditures of the Party under 2 

U.S.C. §441a(d)." Such expenditures must be 

paid from the Federal campaign committee 

of the Party. 

AO 1978-47: Contribution limitations 

Since the Commission is still in the process of 

securing facts as to whether the Pennsylvania 

Medical Political Action Committee (PMPAC) 

and the American Medical Political Action 

Committee (AMPAC) are affiliated, the Commission cannot issue an advisory opinion concluding that the Don Bailey for Congress Committee may lawfully accept general election 

contributions totaling $8,000 from PMPAC and 

AM PAC. 

AO 1978-48: Use of Electrical Car 

in Campaign 

Senator James A. McClure may personally lease 

an electric car from the General Electric Company to commute from his Virginia residence to 

his office in Washington, D.C. However, if Mr. 

McClure ships the car to Idaho for use in his 

campaign for reelection, the cost of shipping the 

vehicle would be considered a contribution 

in-kind by Mr. McClure to his campaign commit· 

tee. In addition, a reasonable portion of the cost 

of leasing this vehicle must be allocated as a 

campaign expense, and be considered a contribution in-kind from Mr. McClure. 

AO 1978-49: Contribution In-Kind 

Congressman Ted Risenhoover need not consider a magazine advertisement expressly advocating his defeat as a candidate for Federal 

office as a contribution in-kind to his campaign, 

if the expenditure for the advertisement was 

made without the "cooperation or consultation" 

of Mr. Risenhoover, his campaign committee or 

any of his authorized agents. In this case, even 

though Mr. Risenhoover considered the advertisement as "good publicity" for his campaign, 

the expenditure for the advertisement would be 

regarded as an "independent expenditure" (by 

the person placing the advertisement) not 

subject to limitation and not reportable by Mr. 

Risenhoover's campaign committee. 

AO 1978-50: Party Get-Out-The-Vote Drive 

The Michigan Democratic Party (the Party) may 

conduct a get-out-the-vote drive for the purpose 

of "identifying and motivating persons to 

support the Party's Gubernatorial nominee." 
80 

However, the expenditures for such a drive must 

also be regarded as for the additional purpose of 

influencing the election of the Party's candidates 

for Federal office. Therefore, the expenses for 

the drive must be allocated on a reasonable basis 

between those made to influence Federal 

elections and those which are not. 

The expenditures allocable to Federal candidates 

must be paid from and reported by the Party's 

Federal campaign committee. These expenses do 

not, however, need to be allocated as contributions to or expenditures on behalf of specific 

candidates for Federal office, unless the drive is 

conducted on behalf of clearly identified candidates. The Party may use materials which 

identify candidates for Federal office in connection with the drive, without the expenses for 

those materials being considered a contribution or expenditure, provided the materials are 

prepared in accordance with the slate card/ 

sample ballot exemption under the Act (2 

U.S.C. §431 (e)(5)(E) and §431 (f)(4)(G)). 

The Michigan State law requiring party committees to make all expenditures from one account 

is preempted and superceded by the provisions 

of the Act which require that expenditures to 

influence the results of Federal elections be 

made and reported by a registered political committee. 

AO 1978-51: Contributions from American 

Indian Tribe 

The Friends of Eldon Rudd, a political committee, may accept a contribution from the 

Ak-Chin Indian Community (the Community). 

As a nonincorporated entity with no corporate 

members, the Community is considered a "person" as defined in the Act (2 U.S.C. §431 (h)), 

permitted to make contributions. Contributions 

from persons may not exceed $1,000 to any 

single candidate per election. If, during a calendar year, the Community contributes more 

than $1,000 to various candidates for Federal 

office (or political committees supporting such 

candidates), the Community would then be 

considered a "political committee" subject to 

the registration and reporting requirements of 

the Act. 

AO 1978-52: Participation in Corporate 

Educational Activities 

Congress Allen E. Ertel may, under certain 

circumstances, receive written materials prepared by the Sun Company (a corporation) 

without being considered to have accepted a 

prohibited corporate contribution. The Sun 

Company may lawfully prepare and distribute 

the materials as internal communications to Sun 

executives and stock-holders. The materials 

could also be prepared for lobbying purposes 

which are outside the Act and jurisdiction of the 

Commission. 

Receipt of the materials by Mr. Ertel would not 

be a "contribution" or "expenditure" because: 

-- " ... There is no apparent purpose to influence [Mr. Ertel's] nomination or election 

to Federal office ...";and 

-- The materials "are not things of value which 

may be 'consumed' or utilized by [Mr. 

Ertel's] campaign in a manner that might 

benefit or influence [his] candidacy." 

The Commission also based its conclusion on the 

fact that only a single copy of the materials 

would be given to Mr. Ertel. 

AO 1978-53 (A-E): Contributions from 

Separate Segregated Fund 

Contributions received by five Congressmen 

from the National Education Association's 

Political Action Committee (NEA-PAC) in 1975 

and 1976 do not have to be returned as a result 

of the recent District Court decision in FEC v. 

National Education Association, eta/. 

The decision held that a system of collecting 

political contributions used by NEA-PAC (the 

"reverse checkoff system") is prohibited by the 

Act (2 U.S.C. §441b). The Court's decision did 

not, however, address the question of the status 

of contributions already received by candidates 

or committees from N EA-PAC. 
81 

The Commission will not require the return of 

1975 and 1976 contributions, provided they are 

otherwise lawful under the Act, " ... since the 

Commission has no evidence that [the candi· 

dates and committees] had any knowledge 

when NEA-PAC contributions were received 

that such contributions had, at least in part, 

been collected by a procedure which has now 

been held to be illegal ...." 

AO 1978-54: Preemption of Alabama 

State Law 

The Federal Election Campaign Act preempts 

and supercedes the requirements of an Alabama 

Law (Chapter 22 of Title 17, Code of Alabama 

1975) regarding the designation of political 

committees by candidates for Federal office. 

The Act and the Commission's regulations provide that State law is preempted and superceded 

with respect to: "the organization and registration of political committees supporting Federal 

candidates, the reporting and disclosure of 

political contributions and expenditures to and 

by candidates to Federal office and political 

committees supporting them, and limitations on 

contributions and expenditures regarding 

Federal candidates and political committees." 

11 CFR 108.7(b). (Emphasis added.) 

AO 1978-56: Dual Role for 

Presidential Candidate 

Congressman Philip Crane may continue to serve 

as National Chairman of the American Conservative Union (ACU) while he is a candidate for 

President of the United States. ACU is a nonprofit, unincorporated organization. Payments 

made to defer expenses incurred in the performance of Mr. Crane's duties as ACU chairman 

would not be considered as in-kind contributions to his campaign or corresponding expenditures by the campaign committee. This conclusion was based on the fo11owing specific facts: 

ACU has not and wm not promote, recognize or 

otherwise identify Mr. Crane as a candidate for 

President of the United States. Mr. Crane 

will not use his ACU office to further his candidacy. Moreover, ACU will not seek to partici· 

pate in primary elections or delegate selection 

and will not transfer any funds to Mr. Crane or 

his committee. The Commission also assumed 

that ACU will not in any way involve itself 

with contributions to Mr. Crane or make any 

communications that expressly advocate his 

election or the defeat of any other Presidential 

candidate. Under these circumstances, any 

publicity resulting from Mr. Crane's activity 

as Chairman of ACU will not be considered a 

contribution under the Act. 

AO 1978-58: National Party Committee 

The Pyramid Freedom Party is not considered to 

be a "national committee," as defined in the 

Act, because it has not yet demonstrated sufficient activity on a national level. 2 U.S.C. 

§431 (k). Therefore, because it supports only a 

candidate for the office of President, it will be 

regarded as a single candidate committee for 

purposes of the reporting requirements and 

contribution limitations of the Act. 

Examples of activity on a national level noted 

by the Commission included: 

-· Nomination of Presidential and Vice Presi· 

dential candidates; 

-· Nomination of numerous candidates for the 

Senate and House of Representatives in 

various States; 

·· Activities outside of those directly involved in 

a specific election (e.g., voter registration or 

get-out-the-vote drives, organization of volunteer workers, publicizing issues of importance 

to the party, etc.). 

AO 1978-59: Definition of 

Honorarium 

Payment to Senator Daniel Patrick Moynihan 

would be considered honoraria if the payments 

involved the reprinting or republication, as an 

article, of any of his previously pub I ished works. 

The payments are considered honoraria regardless of "whether or not additional effort is 

required from the author to produce the income 

from the reprint." Payment for an article is 

specifically included in the definition of "hono· 
82 

rarium" in the Commission's regulations (11 

CFR 110.12(b)). "Article" is defined to include 

a writing (other than a book) which has been 

published. 

Income realized from the publication of books, 

however, is not considered an honorarium. 

Therefore, payments for the reprinting or 

republication of his works in a book are not 

considered honoraria and are not subject to the 

honoraria I imitations in 2 U .S.C. §441 i. 

AO 1978-60: Use of Network 

Television Tape 

Use of an NBC videotape by Congressman 

Harold S. Sawyer in connection with his campaign for reelection to Federal office would 

constitute a prohibited contribution in-kind 

by a corporation, because the videotape was 

made and then given to him free of charge by 

NBC. 

Congressman Sawyer may, however, use a copy 

of the videotape for campaign-related activities 

if he first pays NBC the usual and normal charge 

for such film. "Usual and normal charge" would 

be "the amount which NBC regularly charges for 

videotape copies to any person who, having 

appeared in an NBC newscast, requests a copy of 

the videotape segment." On the other hand, if 

NBC's established policy and practice is to 

provide such videotape segments free of charge 

to any individual who appeared in a newscast, 

the free film given to Congressman Sawyer 

would not constitute a contribution in-kind and 

could be used in connection with campaignrelated activities. 

AO 1978-61: Corporate Solicitation 

ofFranchisees 

Jerrico, Inc. (Jerrico) or its separate segregated 

fund may solicit contributions from the executive and administrative personnel of the franchisees (restaurants) of Jerrico and of Long John 

Silver's, Inc. (LJS), a wholly-owned subsidiary 

of Jerrico. 

Because of Jerrico's " ... continuing control and 

direction over the business policies, practices 

and procedures of its franchisees, as well as the 

nature and extent of the franchisees' contractual 

obligation to Jerrico ..." the franchisees are 

considered to be affiliates of Jerrico. 

All separate segregated funds established by the 

franchisees would share a single contribution 

limit with Jerrico's separate segregated fund. 

AO 1978-63: Donations to Retire 

Campaign Debts 

Donations to retire campaign debts of Friends of 

Dick Obenshain (the Committee), the principal 

campaign committee of the late Richard 

Obenshain, are not considered contributions 

within the definition of the Act or regulations. Because the donations to the Committee 

are not made to influence the results of a 

Federal election, they are not subject to contribution Iim its. As receipts, however, they must 

be reported by the Committee. The retirement 

of debts of the Committee must also be reported. 

The conclusion is based on two assumptions: 

-- "Any funds received in excess of the amount 

required to liquidate the debt will not be 

transferred or applied for the benefit of any 

'political committee' or 'candidate' ... "; 

and 

-- None of the debts to be retired will be assumed by any political party organization. 

AO 1978-64: Contributions by 

Party Committee 

The National Republican Senatorial Committee 

may give up to its limit of $17,500 to the 1978 

Senate campaign of John Warner, even though 

the Committee had previously given that 

amount to the 1978 Senate campaign of the late 

Richard Obenshain. Mr. Warner was selected as 

the new Republican nominee for the Senate in 

Virginia upon the death of Mr. Obenshain. The 

limitations "relate to a particular candidate for 

the Senate rather than a particular Senate seat." 

2 U.S.C. §441a(h). 
83 

AO 1978-65: Reporting Rules and 

Contribution limits for 

Unopposed Candidates 

Although Andy Ireland, candidate for Congress, 

is unopposed in Florida's general election, he is 

considered a candidate because he will not 

receive a certificate of election until after the 

general election. Accordingly, Mr. Ireland is 

required to file pre- and post-general election 

reports. Regulations concerning quarterly 

reports are also applicable. See 11 CF R 104.1 

(c)(1 )(i) and 104.4(d). 

A separate contribution limit applies to each 

election in which Mr. Ireland seeks nomination 

or election. Thus, one individual could contribute $1,000 for his primary and another $1,000 

for the general election. As a general rule, 

contributions made after the date of the primary 

count toward the general election. In this case, 

the date on which a primary election would have 

been held is considered to be the date of the 

primary. 

Surplus funds from the 1978 campaign, consisting of funds received before the general 

election, may be transferred as a lump sum to 

the 1980 campaign committee. These funds 

are not subject to the 1980 election limits. The 

individual contributors of surplus funds need 

not be identified on subsequent reports since 

they were already disclosed in 1978. 

Except for contributions made to retire debts 

outstanding from the 1978 election, contributions received after the 1978 general election are 

attributable to a 1980 election and count against 

the 1980 election limits. 

AO 1978-66: Preemption of 

California Law 

William E. Dannemeyer, a candidate for the U.S. 

House of Representatives, may accept contributions from lobbyists registered under California 

law, even though he is also currently an elected 

State officer in California. A State law prohibiting contributions from lobbyists to any State 

officer is preempted by the Federal Election 

Campaign Act, to the extent the officer accepts 

contributions made to him (or his campaign 

committee) as a candidate for Federal office. 2 

u.s.c. §453. 

AO 1978-67: Headquarters Shared by 

Federal and Non-Federal 

Candidates 

Congressman Glenn M. Anderson may share the 

costs of a combined campaign headquarters with 

a candidate for State office provided the costs of 

the shared facilities are allocated between the 

two campaigns "in a manner which equitably 

reflects the actual use and benefit to each 

campaign." Payment of Congressman 

Anderson's share of the costs would be considered an expenditure by his principal campaign 

committee and may be made in one of the 

following ways: 

-- Payment by Congressman Anderson's committee directly to the commercial vendor(s); 

Payment by Congressman Anderson's committee to the State candidate's committee 

(which, in turn, pays the full amount to the 

commercial vendor(s)); or 

-- Payment directly to the commercial vendor(s) 

by a single check drawn on an escrow account 

established jointly by Congressman 

Anderson's committee and the State candidate's committee. 

Payment may not be made by means of a 

transfer from the State candidate's committee to 

Congressman Anderson's committee if the State 

candidate's committee has accepted any funds 

which would not be lawful under the Act. If 

the State candidate's committee paid the entire 

cost of the headquarters, without being reimbursed by Congressman Anderson's committee, 

the payment would be considered a contribution 

in-kind to Congressman Anderson's campaign, 

subject to the Act's limitations and prohibitions. 

AO 1978-68: Contributions by 

Credit Card 

The Seith for Senate Committee (the Committee) may accept contributions made by credit 
84 

card which are authorized to be made over the 

telephone. The definition of "contribution" 

includes a written agreement to make a contribution, and does not require that the agreement 

be signed by the contributor. Such credit card 

contributions would be considered received by 

the Committee (and thus, reportable) when the 

proceeds of the transaction are received by the 

Committee from the credit card company. 

The amount of the contribution is considered to 

be the total amount authorized by the contributor. The total contribution may not be reduced 

by discounts or service charges deducted by the 

credit card company before transferring the 

proceeds to the Committee. Any such discounts 

or service charges are considered expenditures 

made by the Committee on the date when it 

receives notice that the discount or service 

charge has been taken. 

The conclusion is based on the assumptions 

that: 

-- The credit card company follows its usual and 

normal collection procedures with respect to 

obtaining payment from credit card holders 

who used their card to make a political 

contribution; 

The credit card company and the independent 

company receiving calls from contributors 

render "their services in the ordinary course 

of business"; and 

The credit card company and the independent 

company receiving caUs are paid the normal 

and usual charge for their services. 

AO 1978-69: 1976 Campaign Committee 

Redesignated for 

1982 Campaign 

The Melcher for Senate Committee (the Committee), Senator Melcher's principal campaign 

committee for the 1976 election, may begin 

receiving and expending funds for the Senator's 

1982 campaign. Senator Melcher, after receiving 

the first contribution for the 1982 campaign, 

must file a Statement of Candidacy for the 1982 

e1ection. An amended Statement of Organization (FEC Form 1) must also be filed to designate the Committee as the principal campaign 

committee for the 1982 election. 

Committee campaign reports indicated that it 

had sufficient funds on hand on January 1, 

1977, to satisfy all outstanding debts from the 

1976 campaign. The Commission concluded, 

therefore, that contributions received by the 

Committee between January 1977 and the date 

of the 1982 Montana Democratic primary 

election count against the 1982 primary election 

contribution limits. 

AO 1978-72: Sale of Pamphlet 

by Candidate 

House candidate Max Carasso may publish and 

sell a pamphlet consisting of articles he previously wrote (between 1956 and 1969) without 

the expenses or proceeds of the sale counting as 

campaign contributions or expenditures. The 

income received from the sale of the pamphlet 

would be considered personal funds provided 

that: 

-- The price charged for the pamphlet is a 

reasonable reflection of Mr. Carasso's costs 

and profit, and is the same as he would charge 

if he were not a candidate; and 

-- Neither the advertisements for the pamphlet 

nor the articles themselves include solicitations for his campaign or advocate the election or the defeat of any clearly identified 

candidate. 

AO 1978-73: Donation of Honorarium to 

Charitable Organization 

An honorarium offered to Representative Dan 

Rostenkowski is not subject to the monetary 

limitations on honoraria as long as the payor 

organization contributes the honorarium 

directly to a charitable organization according to the rules prescribed by 2 U.S.C. §441 i(b). 

Under that provision, adopted by Congress on 

December 20, 1977 {Public Law 95-216, Section 

502), an honorarium is not considered to have 

been "accepted" by an officeholder (and, 

therefore, is not subject to the limits) when the 
85 

payor organization contributes it directly to one 

of five charitable organizations suggested by the. 

officeholder. The limitations on honoraria are 

triggered only if the honorarium is in fact 

"accepted." 

AO 1978-74: Payroll Deduction Plan for 

Labor Organization's Members 

The International Union of Operating Engineers 

(IUOE), Local 675, and Lone Star of Florida, 

Inc. (or any other corporation employing IUOE 

members) may agree to use a payroll deduction 

plan to collect contributions from IUOE members for IUOE's separate segregated fund. The 

agreement may be made even if the corporation 

does not provide such a plan for soliciting 

contributions from its own executive and 

administrative personnel. See 11 CF R 114.5(k) 

(4). 

AO 1978-75: Solicitation of Parent 

Corporation's Stockholders 

by Subsidiary's Separate 

Segregated Fund 

The United Good Government Fund (the Fund), 

the separate segregated fund of United Airlines, 

Inc. (United), may solicit the stockholders of 

United's parent corporation UAL. Under the 

Commission's regulations, a corporation or its 

separate segregated fund may solicit the executive and administrative personnel of the corporation's subsidiaries and affiliates. In this case, the 

parent corporation (UAL) is considered an 

affiliate of the wholly-owned subsidiary 

(United); hence, the Fund may lawfully solicit 

the individual stockholders of UAL. All separate 

segregated funds established by a corporation, 

its affiliates, subsidiaries, branches and divisions 

are subject to a single contribution limitation. 

AO 1978-76: Use of Film Produced 

with Campaign Funds 

A film produced with campaign funds may be 

shown on television, as a public service announcement, after the November election. The 

film depicts facilities and services available to 

constituents through Representative Robert 

Duncan's congressional office. A station's offer 

to run the film as a public service announcement, free of charge to Mr. Duncan, would not 

constitute an in-kind contribution to Mr. 

Duncan. Under the Act, a news story, commentary or editorial distributed through the 

facilities of a broadcasting station is not considered an expenditure and is not treated as an 

in-kind contribution unless the broadcast 

facilities are owned or controlled by a political 

party, political committee or a candidate. The 

Commission concluded that this exception 

applied to the broadcast of public service 

announcements. 

The Commission expressed no opinion as to the 

application of tax laws, House Rules, or the 

rules of the Federal Communications Commission to the situation described, since these 

matters fall outside the Commission's jurisdiction. 

AO 1978-77: Volunteer Activity Rendered 

by Corporate Officer 

Congressman Les Aspin may use a campaign 

radio commercial in which an officer of American Motors Corp. (AMC), identified by name 

and title, describes the legislative efforts of the 

Congressman. The activity would not constitute 

a contribution to Representative Aspin's campaign because the campaign committee will pay 

for all the production and broadcasting costs of 

the commercial. The actual time spent in taping 

the commercial would be regarded as volunteer 

activity by the AMC officer. Under the Act, 

volunteer activity is not considered a political 

contribution. 

AO 1978-78: Funds Contributed to

Defray Office Rent 

The National Conservative Political Action 

Committee (NCPAC) may not, under 2 U.S.C. 

§431 (e)(5)(H), solicit persons otherwise prohibited from making political contributions for 

funds to defray office rental expenses. This 

special provision of the Act exempts certain 

funds from the definition of contribution, but 

only when contributed to a national or State 

committee of a political party. Even though 
86 

NCPAC supports a wide variety of Federal and 

State candidates and engages in political education on specific issues of public interest, it is not 

a "political party" under the Act. 

Any funds given to NCPAC for the purpose of 

defraying office rental expenses are, therefore, 

considered contributions subject to the Act's 

limitations and reporting requirements. 

AO 1978-79: Separate Contribution limit 

for Candidate Unopposed 

in General Election 

Senator J. Bennett Johnston's name will not 

appear on the general election ballot in 

Louisiana because he is unopposed in that 

election. He may nevertheless receive contributions with respect to the 1978 general election 

because the certificate of e1ection is not granted 

until after the general election. See 11 CF R 

110.1 (j}. Contributions made after the Louisiana 

primary on September 16, 1978, but not later 

than the general election on November 7, would 

be attributed to the general election. They 

would count against a separate limit for that 

election, rather than against the limits for an 

election in 1984. 

Senator Johnston's campaign committee is 

required to file pre-election and post-election 

reports covering the general election period. 

AO 1978-80: Campaign Use of Property 

Owned by Candidate 

Representative Benjamin Gilman's campaign 

committee may use its funds to lease office 

space in a building owned by Mr. Gilman. Such 

payments must be reported as operating expenditures by the committee. 

AO 1978-83: Use of Authorization Form to 

Secure Corporate Approval of 

Solicitations by Trade Association 

The Construction Equipment Political Action 

Committee (CEPAC), a separate segregated fund 

of a trade association, may set up a booth at the 

annual convention of that trade association to 

attempt to secure corporate approval for CEPAC 

solicitations. Specifically, CEPAC may use the 

booth to obtain from representatives of the 

member corporations of the trade association 

their signatures on an authorization form giving 

approval for the solicitation of their stockholders and their executive and administrative 

personnel. 11 CFR 114.8. CEPAC's use of 

special authorization forms to obtain corporate 

approval to solicit authorized personnel is 

permissible as long as: 

-- The authorization form states its purpose and 

any limitations that CEPAC wishes to place 

on the class of persons to be solicited; and 

-- The authorization form indicates that corporate approval is required and that such solicitations must be limited to one trade association per year. 

A booth may be used to secure corporate 

approval for solicitations provided: 

-- The solicitation approval request is in writing; 

and 

-- The request form is signed by a person authorized to grant such approval. 

Once corporate approval has been granted, 

CEPAC may solicit and accept contributions 

from the personnel authorized to be solicited 

by the corporation. 

AO 1978-85: Use of Excess 

Campaign Funds 

The Whitehurst for Congress Committee may 

use excess campaign funds to defray expenses of 

a buffet luncheon to be given in honor of Mr. 

Whitehurst's 10th year as Congressman from 

Virginia. A candidate or individual holding 

Federal office may use excess campaign funds to 

defray any ordinary and necessary expenses 

incurred in connection with duties as a Federal 

officeholder. Since this event relates to Mr. 

Whitehurst's service as a Member of Congress, 

the use of excess campaign funds for this purpose is permissible under the Act. The Committee must report the disbursements. 
87 

AO 1978-87: Use of Excess 

Campaign Funds 

Senator James B. Pearson may transfer 

$100,000 in excess campaign funds to the 

University of Kansas Center for Research, Inc., 

for the purpose of establishing a fellowship 

program. The Act provides that it is lawful 

for excess campaign funds to be contributed to 

recognized charitable organizations. 

AO 1978-88: Public Service Announcements 

by Former Candidate 

State Senator Ronald R. Hein, a former candidate for the U.S. House of Representatives, may 

make public service announcements to raise 

money for diabetes research while his congressional campaign committee remains active in its 

effort to retire campaign debts. Any publicity 

resulting from these announcements will not 

constitute either a contribution or an expenditure on behalf of Mr. Hein's campaign since the 

announcements will make no reference to his 

candidacy for Congress and no appeal for 

campaign funds. 

AO 1978-92: Limitations and Reporting 

Requirements for Recount 

Funds collected and disbursements made by the 

Miller for Senate Committee (the Miller Committee) for the purpose of defraying expenses of 

a Federal election recount are not contributions 

or expenditures under the regulations. 11 CF R 

100.4(b)(l5). No gifts or payments may be given 

by or accepted from a national bank, corporation or labor organization. A separate segregated 

fund of such an organization may, however, 

make a donation or disbursement for a recount. 

On the other hand, if a separate organization 

were established by the current officers or staff 

of the Miller Comm1ttee solely for the purpose 

of funding the recount effort, it would not 

become a "political committee" since its 

receipts and disbursements would not be contributions or expenditures under the Act. Thus, 

neither a Statement of Organization nor any 

reports would be required. 

If the Miller for Senate Committee set up a bank 

account for recount purposes, the Committee 

would have to amend its Statement of Organization and report the receipts and disbursements, relating to the recount. 

In either case, a political committee making a 

donation for the recount would be required to 

itemize the donation as a transfer. In addition, 

the committee should attach an explanation that 

the donation was exempt from the limitation 

because it was made for recount purposes only. 

With regard to funds received for recount 

purposes, any surplus could not be used in a 

manner that would constitute a contribution or 

expenditure under the Act or regulations. 

Surplus funds could, however, be spent for other 

lawful purposes unrelated to Federal elections. 

AO 1978-93: Use of Excess 

Campaign Funds 

Senator Lloyd Bentsen may transfer u nexpended campaign funds from his 1970 campaign to 

his reelection committee for use in the 1982 

election. Commission regulations provide that a 

candidate may transfer funds from a previous 

campaign committee to a currently registered 

principal campaign committee, as long as none 

of the transfers consist of funds which would be 

in violation of the Act. 

With regard to this opinion and the following 

two opinions, the Commission has no jurisdiction over the application of tax laws and House 

or Senate Rules to the situation described. 

AO 1978-94: Use of Excess 

Campaign Funds 

Excess campaign funds remaining from the 

principal campaign committee and three other 

authorized committees of the late Congressman 

Ralph H. Metcalfe may be used for several 

purposes consistent with State and Federal laws. 

The funds may be transferred to Federal, State 

or local election campaign committees of the 

Congressman's son, to a political ward organization, to the surviving members of the Congress-
88 

man's immediate family, to employees of his 

Congressional and campaign committee staffs 

and to qualified charitable organizations. 

For contribution purposes, the four campaign 

committees are considered a single committee. 

Thus, any transfers to political committees or 

candidates involved in Federal elections would 

be subject to one overall contribution limit. 

A contribution to Ralph Metcalfe, Jr., as a 

candidate for Federal office, for example, would 

be limited to $1,000 per election. Transfers to a 

State campaign of Ralph Metcalfe, Jr. would not 

be limited, however, since contributions made to 

State and local elections are not subject to the 

monetary I im its of the Act. 

AO 1978-95: Use of Excess 

Campaign Funds 

Congressman James J. Florio may use excess 

campaign funds to retire a debt remaining from 

his 1977 gubernatorial campaign provided there 

are no State or Federal laws prohibiting the 

transaction. The Act provides that candidates 

for Federal office may use excess campaign 

funds to support their activities as Federal 

officeholders, to contribute to a qualified 

charitable organization or to defray expenses for 

"any other lawful purpose." 2 U.S.C. §439a. 

The committee should report the transfer of 

funds on the report covering the period when 

the transfer is made. 

AO 1978-96: Honoraria 

When Congressman Clarence J. Brown accepts a 

speaking engagement, he may request that the 

sponsoring organization donate his honorarium 

to any of five charitable organizations he suggests in a letter. Under 2 U.S.C. §441i(b), if a 

sponsoring organization chooses to make a 

donation to any of the five or more charitable 

organizations suggested by Mr. Brown (instead 

of paying an honorarium to Mr. Brown), the 

payment will not count against Mr. Brown's 

honorarium limit. 
Appendix 6 89 

Summary of 

Disclosure Files 

!\"' p.f!J 41 l' 4:? if·$" ....§ 

-!~co "' 4.~"' a!~ .; ll"' .,.f!J !\"'

J;

·~·.S 

!l 

i<.~ 

~s .... -~.$ ~o,,$ t>t i; ~ 

rfi lb<.J 

"q;~ ~'!>~ $~ ~ q; <f* W*

,J;.._ 

.,::y .. ::y ;§::! l;;;q ~~ .. ~ t ... .._o OJ O'OJ ·-:::::: 0 ·~ 0 ,§t; #"O (j .... 0"' i<.i' i<.i' te>c:' "~~.;"' i' ·$" ·S 

Presidential 499 $1,387,555 $1,623,674

Candidates 

Committees 

122 

177 

96 

111 

13

0 

8 

66

Senate 5,539 $83,550,159 $83,698,823

Candidates 

Committees and 

Office Accounts 

562 

655 

246 

292 

254

0 

62 

363 

House 25,859 $108,416,103 $104,176,819

Candidates 

Committees and 

Office Accounts 

2,878 

3,175 

1,678

0 

981 

1,438 

219 

1,737

*Based on data taken from reports 

filed as of 12/31 /78. 

Party 6,500 $117,453,809 $124,285,138

National Level 55 21 0

Committees 

34 

State Level Committees 180 68 112 

Local Level Committees 554 257 297 

Convention Committees 8 5 3 

Delegates 6 4 0 2 0 50 7,595

Nonparty 27,427 $54,387 ,415 $61,737,926

218 

Corporate Committees 

Labor Committees 273 55 0

784 

Membership, Trade & 

Other Committees 

833 49 0

797 166 0 631

Communication Cost 

Filers 87 N/A 0 $5,903 $217,545 I I N/A 65

I 

1 ndependent Expenditures 

by Persons Other Than 

Politiccil Committees 69 26 0 43 214 $86,824 $116,016
Appendix 7 91 

Computer Indices Available 

A Index: Names and Addresses 

of Candidates 

Sorted by type of office sought (President, U.S. 

Senator, U.S. Representative), and alphabetically by last name or by State/Congressional 

district. 

B Index: Names and Addresses 

of Committees 

Includes name of connected organization, name 

of treasurer, committee ID number, notation if 

it is "qualified" as multicandidate committee, 

and filing frequency. This index can be sorted 

alphabetically by committee name, by committee ID number, and by type (Presidential, 

Senate, House, party, nonparty). 

C Index: Disclosure Documents Filed by 

Political Committees 

Includes, for each committee, its name, ID 

number, list of each document filed (name of 

report, period receipts, period expenditures, 

coverage dates, number of pages and microfilm 

location), total gross receipts and expenditures, 

and number of pages. 

D Index: Index of Candidates 

Supported by Committees 

Includes, for each committee, its name, ID 

number, name of connected organization, 

notation if it is "qualified" as multicandidate 

committee, and a listing of all Federal candidates supported, together with total aggregate 

contributions to or expenditures on behalf of 

each candidate (1972-78). In the case of party 

committees, coordinated party expenditures 

(§441a(d)) are listed in place of independent 

expenditures. 

E Index: Index of Candidates 

and Supporting Committees 

Includes for each candidate the following: 

1. Candidate name, district/State, party affiliation and candidate ID number. 

2. Listing of all documents filed by the candidate (type, coverage dates, period receipts, 

period expenditures, number of pages, microfilm location). 

3. Listing of all documents filed by the principal 

campaign committee (See C Index for explanation). 

4. Listing of all documents filed by other 

authorized committees of the candidate. 

5. Listing of all committees (other than those 

authorized by the candidate) forwarding 

contributions to the candidate, the principal 

campaign committee, or an authorized 

committee, and the aggregate total of such 

contributions given to date. This listing also 

identifies committees making expenditures 

on behalf of the candidate or party committees making coordinated party expenditures 

(§441a(d)), including the aggregate total 

spent to date. 

6. Listing of all persons or unauthorized single 

candidate committees filing reports indicating 

they made independent expenditures on 

behalf of the candidate. 

7. Listing of all persons or committees filing 

unauthorized delegate reports. 

8. Listing of all corporations or labor unions 

filing reports of communication costs on 

behalf of the candidate. 

G Index: Index of Itemized Transactions 

for Each Candidate and 

Political Committee* 

Itemized receipt and disbursement transactions 

are listed, along with the amounts of the transactions, keys to reports in which the transactions were indicated, and the microfilm location of transactions. Five categories were represented: 

1. Individual transactions, including individual 

contributions and loan activity. 

2. Selected loan and loan repayment transactions, including loans from banks. 

3. Unregistered political organization transactions; that is, contributions to candidates 

from organizations which are not registered 

under the Act. 

*Pursuant to restrictions in 2 U.S.C. §438(a){4), the G Index 

with its names of contributors and addresses is available for 

public inspection exclusively at the Commission and may not 

be mailed out or copied. 
92 

4. Corporate refund/rebate transactions with 

itemized receipts showing refunds of deposits. 

5. Transactions among registered candidates/ 

committees which indicate transfers and loan 

activity. 

Y Index: Special Inquiry 

This immediate access system permits direct 

video display or printout of selected information 

in the Disclosure Information System. It consists 

of between 40 and 50 separate programs which 

may be used to locate, retrieve or display 

individual items or categories of information. 
Appendix 8 93 

FEC Publications and 

Clearinghouse Studies 

FEC Publications 

Federal Election Campaign Laws (June 1976). 

This volume is a complete compilation of 

Federal election campaign Jaws. It consists of 

three sections: The text of the Federal Election 

Campaign Act, as codified in Titles 2 and 26 of 

the U.S. Code; the text of additional statutory 

provisions which are not under the Commission's jurisdiction but are relevant to persons 

involved in Federal elections; and a subject 

index of Title 2 relating to disclosure and 

contribution limits. 

Federal Election Commission Regulations (April 

1977). This volume is a complete compilation 

of the FEC Regulations prescribed on April 13, 

1977. It includes two indexes: one covering 

general regulatory provisions related to contribution limits, registration, recordkeeping and 

reporting (Parts 100-115) and a second covering 

the public financing provisions (Parts 120-125, 

130-134 and 140-146). 

FEC Record. Published as a four- to eight-page 

binder insert, the newsletter serves as the primary means of informing candidates, political 

committees, parties and other persons interested 

in Federal elections about Commission activity. 

During 1978, twelve issues and an Annual Index 

for 1977 covered the following major topics: 

-- Reports Due 

-- Advisory Opinions 

-- Statistics 

-- Regulations 

-- Compliance Matters 

-- Litigation 

-- Legislation 

-- FEC Procedures and Staff 

-- Federal Register Notices 

-- Publications 

An index to the 1978 Record (Volume 4) was 

published in February 1979. 

Campaign Guide Series. Several color-coded 

pamphlets comprise the Federal Election Commission's Campaign Guide series, a reference 

tool prepared by the FEC to assist candidates 

and political committees in complying with the 

Federal Election Campaign Act. Each Guide, 

prepared as a binder insert, has a distinct focus 

as described below: 

1. Campaign Guide for Congressional Candidates and Their Committees (February 1978). 

This Guide, substituting for three Guides 

written in 1976, focuses exclusively on the 

concerns of Congressional candidates and 

their committees. It includes a thorough 

explanation of contributions and expenditures, as well as an examination of other 

sources of campaign support such as volunteer 

activity, independent expenditure activity and 

party activity. The Guide also contains a 

comprehensive explanation of registration, 

recordkeeping and reporting requirements. 

2. Campaign Guide for Political Committees 

(September 1978). This Guide focuses on the 

requirements, under the Federal Election 

Campaign Act, of political committees which 

have not been authorized by any candidate 

for Federal office. 

Consolidating material which appeared in 

three Campaign Guides published in 1976 and 

1977, the Guide discusses the basic differences between contributions and expenditures 

and provides details on recordkeeping, registration and reporting requirements. In addition, the Guide describes the various ways a 

committee may support candidates and other 

committee activities such as fundraising and 

advertising. 

3. Campaign Guide for State and Subordinate 

Party Committees (September 1976). This 

pamphlet explores the role that party committees play in financing Federal campaigns. 

Topics include: committee registration 

requirements, contributions to candidates, 

allocable and nonallocable expenditures for 

Congressional and Presidential campaigns, and 

a checklist of "do's and don'ts" for party 

committees. 
94 

Annual Report 1977 (March 1978). The third 

Annual Report to the President and Congress 

provides a comprehensive review of the Commission's activities during 1977, including Congressional testimony on campaign financing bills, 

public financing certifications, legislative recommendations and new procedures. Statistical 

data is provided in the Appendices. 

The FEC and the Federal Campaign Finance 

Law (October 1978). This 12-page pamphlet 

gives a brief overview of the major provisions of 

the Federal Election Campaign Act and the 

Commission's role in administering it. The 

brochure also summarizes the information and 

assistance available from the FEC and contains 

details on how to obtain additional information 

on other election-related topics. 

Bookkeeping and Reporting Manual. This booklet presents a recommended method of bookkeeping to assist Federal candidates and political 

committees in maintaining records required by 

the Federal Election Campaign Act. 

The Reports on Financial Activity Series. Based 

on data taken from reports filed by candidates 

and political committees, the Reports on Financial Activity series provides cumulative statistical 

studies of the 1978 election cycle beginning 

with January 1, 1977. The following cumulative 

statistical studies were issued during 1978: 

Interim Report No. 1: Party and Nonparty 

Political Committees, Apri/1978 

Vol. I - Summary Tables 

Vol. II - State and Local Party Detailed 

Tables 

Vol. Ill - Nonparty Detailed Tables 

Interim Report No. 2: Party and Nonparty Political Committees, September 1978 

Vol. I - Summary Tables 

Vol. II - State and Local Party Detailed 

Tables 

Vol. Ill - Nonparty Detailed Tables (corporate 

and labor) 

Vol. IV - Nonparty Detailed Tables (no connected organization; trade, membership, health; cooperative, corporation without stock) 

Interim Report No. 3: U.S. Senate and House 

Campaigns, October 1978 

With the exception of the Reports on Financial 

Activity series, all publications listed above are 

available free from the Public Communications 

Office of the FEC. The Reports on Financial 

Activity are available from the Public Records 

Office. 

Clearinghouse Research Studies 

Continuing Reports 

Election Law Updates are a quarterly series, 

cumulative through the calendar year, which 

summarize all election code changes in each of 

the 50 States. The series is designed to provide 

up-to-date election code information to State 

legislators, court officials and election administrators. 

Election Case Law reports are a quarterly series, 

cumulative through the calendar year, which 

summarize election cases in the State and 

Federal courts. The reports provide updates of 

judicial developments pertinent to elections. 

Campaign Finance Law is an annual report 

summarizing campaign finance laws in each of 

the States as well as at the Federal level. The 

report also provides a convenient chart summary 

of State and Federal requirements. 

Election Directory -is an annual report which 

summarizes the responsibilities of each State's 

chief election official, election board or commission. Names, addresses and telephone numbers 

of State election officials, offices and related 

legislators are also provided. 

Topical Reports 

Voting Systems is a three-volume report on 

voting equipment currently on the market. 
95 

Volume I describes each device in detail and 

offers local officials step-by-step procedures for 

defining equipment needs and procuring equipment. Volume II summarizes representative 

State codes with regard to voting equipment 

acquisition. Volume Ill offers recommendations 

for drafting such legislation. 

Statewide Registration Systems 1 & 2 is a report 

on computerized statewide voter registration 

systems. Volume I examines problems involved 

in implementing a statewide system and offers 

suggestions for overcoming them. Volume II 

describes in detail the forms, procedures, outputs and variations on the basic Statewide 

computerized system. 

Contested Elections and Recounts is a threevolume analysis of the laws and procedures 

governing contested elections and recounts for 

Federal offices. Volume I examines those issues 

and functions within the Federal government's 

purview, and makes recommendations for 

improving the handling of contested elections at 

the Federal level. Volume II examines State 

issues and options, and makes recommendations 

for improving the State handling of such cases. 

Volume Ill summarizes laws related to contested 

elections in each of the States and at the Federal 

level. 

Ballot Access is a four-volume report on how 

candidates gain access to the ballot for Federal 

office in each of the States. Volume I identifies 

central administrative issues and problems and 

makes recommendations for improving the 

process. Volume II describes the administrative 

process in each State. Volume Ill details State 

legal memoranda and makes recommendations 

for improving the legal process. Volume IV 

briefly summarizes ballot access requirements 

for Federal office in each State. 

Mail Registration Systems 1 discusses problems 

involved in implementing a mail registration 

system. In addition to a general description of 

how mail registration systems operate, the 

report offers practical suggestions for overcoming difficulties. 

Bilingual Election Services is a three-volume 

report on providing election services in languages 

other than English. Volume I summarizes such 

services since 1975. Volume II is a manual for 

local election officials. It offers practical advice 

on ways to: identify the language problems in a 

jurisdiction, provide bilingual registration services and provide bilingual balloting services. 

Volume Ill provides a glossary of common 

election terms in English along with their 

Spanish and dialectical equivalents. 

Election Administration is a four-volume set 

introducing program planning, management and 

financial control concepts into local election 

administration. Volume I provides an overview 

of election functions and tasks, and introduces 

the notion of a management cycle. Volume II 

focuses on planning, provides detailed task/activity checklists and flow diagrams, and demonstrates how tasks can be assigned. Volume Ill 

introduces a chart of accounts and demonstrates 

how budgets can be prepared and costs monitored by applying the chart to each election 

function. Volume IV is a set of legal memoranda 

summarizing State code processes with regard to 

administrative and budgeting responsibilities. 

Studies Currently Underway 

Training Election Officials examines the problems and methods involved in training poll 

workers, deputy registrars and chief local 

election officials for election day. A "how-to" 

volume will assist State and local officials 

in designing effective training programs. 

Election System Statistics seeks a common set 

of performance measures that local election 

officials can use to evaluate their election 

systems. Manuals will identify relevant data 

collection and analysis methods. These statistics 

can then be used to improve effectiveness and 

efficiency of election services. 
96 

Registration File Maintenance and Verification 

focuses on improving the accuracy of voter 

registration lists around the country. Product 

manuals will offer concrete guidance in adding 

to, deleting, changing and purging file entries. 

Emphasis will be placed on verifying these steps 

by both manual and automated file systems. 
Appendix 9 97 

FEC Library: 

Summary of Collection 

The FEC I ibrary is part of the Office of General 

Counsel and, although primarily used by the 

legal staff, serves all divisions of the Federal 

Election Commission. Located on the fourth 

floor, the library is also open to the public on 

weekdays between 9:00a.m. and 5:00p.m. The 

collection includes basic legal research tools with 

an emphasis on materials dealing with political 

campaign financing, corporate and labor political activity, and election and campaign reform. 

Functions of the Library 

The library serves as the central reference and 

research center for the Commission. It is part of 

a nationwide interlibrary loan system designed 

to quickly provide staff members with items not 

readily available within the Commission. As a 

selective depository, the library also receives 

selected Government documents and other items 

from the Government Printing Office on a 

regular basis, including the Federal Register, 

Congressional Record, Code of Federal Regulations, and U.S. Supreme Court Slip Opinions. 

Resources of the Library 

Outlined below is a brief explanation and 

description of each resource area contained in 

the FEC library. 

General Reference Section 

. This section contains reference tools frequently 

used by all divisions of the Commission including topical encyclopedias, dictionaries, Government and Congressional directories, atlases, 

manuals, almanacs and a current set of the 

Martindale-Hubbell Law Directory. 

Federal Election Commission Document Center 

This section includes administrative material 

generated by the Commission as well as legislative material bearing on the establishment and 

operation of the Commission and the Regulations governing Federal election campaigns. 

Materials include bound legislative histories of 

the Federal Election Campaign Act of 1971 and 

all subsequent amendments; transcripts of FEC 

hearings on Regulations; Advisory Opinions and 

Advisory Opinion Requests; Opinions of Counsel; Federal Register Notices; FEC Meeting 

Minutes; FEC Record; FEC Campaign Guide 

Series; Task Force Reports; Audit Reports; 

and Disclosure Reports. 

Case Material File 

For cases directly involving the Federal Election 

Commission in litigation, the case material file 

contains available briefs and records and copies 

of judicial decisions rendered. In addition, the 

case material file contains briefs and slip opinions for relevant court cases. 

Journal Article File 

A journal article file contains photocopies of 

pertinent law review articles and Library of 

Congress Congressional Research Service reports 

devoted to discussions of the Federal Election 

Commission, election reform, campaign finance, 

Congressional ethics, administrative law and 

procedure, corporations and politics, labor and 

politics, the Privacy Act, the Freedom of Information Act and the Sunshine Act. Materials 

dealing specifically with election administration 

and State election legislation are located in the 

Clearinghouse Document Center. (See Chapter 

on Clearinghouse.) 

Periodical and Journal Collection 

The library maintains subscriptions of periodicals which are considered helpful to the work of 

the Commission including, Campaign Practices 

Reports, Access Reports, Congressional Quarterly Weekly Reports, National Journal Reports, 

the Wall Street Journal and the Harvard Law 

Review. 

Looseleaf Service 

The two most important looseleaf services 

housed in the library are United States Law 

Week, published by the Bureau of National 

Affairs (BNA), which includes coverage of 

recent Supreme Court decisions and lower court 

decisions; and the Federal Election Campaign 
98 

Finance Guide, published by Commerce Clearing 

House (CCH). Other services housed in the 

library include: Standard Federal Tax Reporter 

(CCH); Congressional Index (CCH); Fair 

Employment Practice Service (BNA); and 

Corporation Law Guide (CCH). 

Book Collection 

The book collection contains election-related 

monographs and legal treatises with an emphasis 

on Federal civil procedure and administrative 

law, as well as legal research sets such as American Jurisprudence 2d, and American Law 

Reports 2d and 3d. 

Code Section 

This section contains major code materials 

required by the legal staff, including the United 

States Code; United States Code Annotated; 

United States Code Service; United States Code 

Congressional and Administrative News; Code of 

Federal Regulations; and Daily Federal Register. 

Reporter Section 

The collection of law reporters includes the 

U.S. Supreme Court Reports (Official and West 

editions); Federal Reporter 2d; Modern Federal 

Practice Digest; Federal Practice Digest 2d; 

Supreme Court Digest (Lawyers edition); 

Federal Rules Decisions; and the slip opinions of 

the U.S. Court of Appeals for the D.C. Circuit. 

Card Catalog 

Primary access to the library collection is 

through the card catalog. It indexes the book 

collection and the journal article file by author, 

title and subject. 

Advisory Opinion Index 

The library publishes and updates the Index to 

FEC Advisory Opinions to aid library users in 

their research of Commission opinions. The 

index is composed of a subject index to all 

Advisory Opinions and Opinions of Counsel 

which have been issued since the Commission's 

establishment in 1975. The Advisory Opinion 

Index also includes a U.S. Code Section index 

and an FEC Regulation index for more recent 

opinions. The index is cumulative for the 

calendar year and is updated quarterly. 
Appendix 10 99 

FEC Federal Register 

Notices, 1978 

Notice 

1978-1 

1978-2 

1978-3 

1978-4 

1978-5 

1978-6 

1978-7 

1978-8 

Title 

FEC Announces Publication of Comprehensive Index of Multicandidate Political 

Committees 

G.A.O. Regulatory Reports Review 

Department of Justice Memorandum 

of Understanding 

Federal Advisory Committee (Clearinghouse) 

Announcement on Annual Comprehensive 

Review 

G.A.O. Regulatory Reports Review 

General Campaign Activities: Proposed 

Regulations 

Vacating Past Commission Policy 

Pronouncements 

FEC Requests Comments on Proposed 

Revision of Presidential Campaign Fund 

Regulations 

Joint FCC/FEC Notice on Sponsorship 

Identification and Candidate Authorization 

Notices 

FEC Rules of Procedure 

Proposed Notice of New Systems of Records 

Federal Aviation Administration Changes 

Regulations to Resolve Conflict with 

Federal Election Campaign Act 

FEC Announces Publication of Cumulative 

Index to Advisory Opinions and Opinions of 

Counsel: April 1975- August 1978 

Federal Register 

Publication Date Citation 

1/19/78 43 FR 2758 

1/25/78 43 FR 3438 

2/8/78 43 FR 5441 

3/7/78 43 FR 9350 

3/15/78 43 FR 10734 

4/7/78 43 FR 14673 

4/19/78 43 FR 16547 

5/31/78 43 FR 23587 

7/13/78 43 FR 30126 

7/21/78 43 FR 31433 

7/26/78 43 FR 32328 

9/26/78 43 FR 44480 

10/31/78 43 FR 50736 
Appendix 11 101 

Status of Audits* 

Types of Committees Audited 

Presidential Candidate CommitteesPublic Financing (1976) 

Presidential Candidate CommitteesNo Public Financing (1976) 

Congressional Candidate 

Committees- Random (1976) 

State Party Committees 

Nonparty, Multicandidate 

Committees 

Congressional Party Committees 

National Party Committees 

Referral Audits (other than 

committees covered by the policy) 

Audits 

Required 

by Audit 

Policy** 

19 

8 

106 

71 

53 

9 

16 

N/A 

Field 

Work 

Completed 

19 

8 

106 

67 

11 

9 

0 

4 

Internal 

Review of 

Audit in 

Progress 

5 

5 

23 

50 

6 

1 

0 

5 

Audits Completed and 

Released to 

Public 

14 

3 

83 

17 

5 

8 

0 

1 

Audits 

to be 

Scheduled 

0 

0 

0 

4 

42 

0 

16 

3*** 

*Figures reflect status of all FEC audits. as of January 10, 1979. 

**Commission's audit policy was adopted in November 1976 and revised in April 1978. 

***These are in addition to referral audits in progress or completed. 

-k U.S. GOVERNMENT PRINTING OFFICE : 1979 D-287-685