Monday

July 11, 1983

Part VI

Federal Election

Commission

Presidential Election Campaign Fund

Provisions
31822 Federal Register / Vol. 48, No. 133 / Monday, July 11,1983 / Rules and Regulations

FEDERAL ELECTION COMMISSION

11 CFR Parts 9001,9002,9003,9004,

9005,9006,9007, and 9012

[Notice 1983-18]

Presidential Election Campaign Fund

Provisions

AGENCY: Federal Election Commission. 

ACTION: Transmittal of regulations to 

Congress.

SUMMARY: The Federal Election 

Commission is revising its regulations 

which implement the Presidential 

Election Campaign Fund Act, 26 U.S.C. 

9001 et seq., and have transmitted those 

regulations to Congress pursuant to 26 

U.S.C. 9009(c). The revisions are based 

on the Commission’s experience in 

administering the Act and on public 

comments received on the Notice of 

Proposed Rulemaking. Many of the 

provisions in these regulations have 

been revised to assure consistency with 

the recently revised Presidential Primary 

Matching Fund Regulations, 11 CFR Part 

9031 et seq. In addition, the revisions 

include a new Part 9012 regarding 

unauthorized expenditures and 

contributions which follows 26 U.S.C. 

9012. Further information on the 

intended effect of the revised 

regulations is contained in the 

supplemental information below.

EFFECTIVE DATE: Further action, 

including the aimouncement of an 

effective date, will be taken by the 

Commission after these regulations have 

been before the Congress 30 legislative 

days in accordance with 26 U.S.C. 

9009(c).

FOR FURTHER INFORMATION CONTACT:

Ms. Susan E. Propper, Assistant General 

Counsel, 1325 K Street, N.W., 

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

or (800) 424-9560.

SUPPLEMENTARY INFORMATION: The 

revisions are based on the Commission’s 

experience in administering the Act and 

on public comments received in 

response to the Commission’s Notice of 

Proposed Rulemaking [48 F R 14532;

April 4,1983]. One issue raised in the 

Notice of Proposed Rulemaking was that 

of providing public funding for 

independent candidates. After receiving 

public comment and Commission 

consideration of this question, these 

provisions were removed from the 

regulations.

26 U.S.C. 9009(c) requires that any rule 

or regulation prescribed by the 

Commission to implement Chapter 95 of 

Title 26, United StatesCode, be 

transmitted to the Speaker of the House 

of Representatives and the President of

the Senate prior to final promulgation. 

The Commission may finally prescribe 

the regulations in question after they 

have been before both Houses of 

Congress for 30 legislative days. The 

following regulations were transmitted 

to Congress on July 1,1983.

Explanation and Justification of the 

Presidential Election Campaign Fund 

Regulations, Parts 9001 through 9007 and 

new Part 9012.

Part 9001—Scope 

S ection 9001.1 Scope.

This section follows current | 9001.1 

Part 9002—Definitions 

S ection 9002.1 A uthorized Com m ittee,

This section generally follows current 

§ 9002.1 but subsection (d) has been 

added to make clear that responsibilities 

of the candidate are also those of his or 

her authorized committee(s).

S ection 9002.2 C andidate.

This section generally follows current 

§9002.2.

S ection 9002.3 Com m ission.

This section follows current § 9002.3. 

S ection 9002.4 E ligible C andidates,

This section follows current § 9002.4. 

S ection 9002.5 Fund.

This section follows current § 9002.5. 

S ection 9002.6 M ajor Party.

This section follows current § 9002.6. 

S ection 9002.7 M inor Party.

This section follows current § 9002.7. 

S ection 9002.8 N e w Party.

This section follows current f 9002.8. 

S ection 9002.9 P olitical Com m ittee.

This section follows current § 9002.9. 

S ection 9002.10 P residen tial E lection,

This section follows current f 9002.10.

S ection 9002.11 Q u alified Cam paign

E xpense.

Subsection (a) generally follows 

current § 9002.11(a).

Subsection (b) generally follows 

current § 9002.11(b) but (b)(2)(in) has 

been added to conform to 11 CFR 

9032.9(b)(3). In subsection (b)(4), 

references to expenditures for travel and 

services provided to Secret Service 

personnel and other staff required by 

law have been deleted as other 

government regulations govern payment 

for those expenditures. Subsection (b)(5) 

generally follows current § 9002.11(b)(5) 

but clarifies that if payments for legal 

and accounting services which are

provided solely to ensure compliance 

with the Act and Chapter 95 of Title 26 

are made by a minor or new party 

candidate from an account containing 

private contributions, the payments do 

not count against that candidate’s 

expenditure limitation.

Subsection (c) has been revised to 

provide that expenditures incurred in 

accordance with § 9004.4 are qualified 

campaign expenses even if incurred 

outside of the expenditure report period. 

This subsection also provides a cross 

reference to § 9004.4(b) which sets forth 

examples of what is a non-qualified 

campaign expense.

S ection 9002.12 Expenditure Report

P eriod.

This section follows current § 9002.12. 

S ection 9002.13 Contribution.

This section follows current § 9002.13. 

S ection 9002.14 S ecretary.

This section follows current § 9002.14. 

S ection 9002.15 P olitical Party.

This section follows current § 9002.15. 

Part 9003—Eligibility for Payments

This Part has been revised to delete 

current §§ 9003.6, 9003.7, and 9003.8. The 

provisions of these sections are now 

incorporated in subsection (b) of 

§ 9003.1 which sets forth the various 

conditions to which a candidate and his 

or her authorized committee(s) must 

agree in order to become eligible to 

receive payments from the Fund. The 

Commission’s decision to include these 

items in the candidate agreement is 

consistent with their inclusion in the 

candidate agreement for Presidential 

primary candidates.

S ection 9003.1 C andidate an d

C om m ittee A greem ents.

This section has been reorganized for 

clarity into two subsections, (a) and (b). 

Subsection (a) sets forth the general 

requirements that a candidate must 

meet to become eligible to receive 

payments and basically follows current 

§ 9003.1 (a) and (b). Subsection (b) sets 

forth in greater detail the various 

conditions to which a candidate must 

agree, and incorporates the provisions of 

current § 9003.6, § 9003.7 and § 9003.8. 

Subsection (b)(1) specifies that the 

candidates shall have the burden of 

proving that disbursements made by 

them, or any authorized committee(s) or 

ageotfis} thereof are qualified campaign 

expenses as defined in 11 CFR 9002.11. 

Subsection (b)(2) contains an agreement 

by the candidate to comply with the 

documentation requirements of § 9003.5.
31823 Federal Register / Vol.

Subsections (b) (3) and (4) require the 

candidate to explain the connection 

between the disbursements and the 

campaign and to maintain and furnish to 

the Commission documentation relating 

to receipts and disbursements.

Subsection (b)(5) generally follows 

current § 9003.7. Subsection (b)(6) 

generally follows current § 9003.1(a)(5). 

Subsections (b) (7) and (8) generally 

follow current § 9003.7 (a) and (b).

Section 9003.2 C andidate

Certifications.

, Subsections (a) and (b) generally 

follow current § 9003.2(a) and (b). 

Subsection (c) generally follows current 

§ 0993.2(c), with three additions. In 

subsection (c)(3)(i) the definition of 

“personal funds” and “personal funds of 

his or her immediate family” has been 

rearranged to make clear that the 

candidate must have legal access or 

control over the funds whether he or she 

has legal or equitable title to the 

property. Also in this subsection, the 

term “equitable interest’ has been 

substituted for “beneficial enjoyment” 

when defining the types of ownership 

interest that may be used as personal 

funds. “Equitable interest” is a more 

specific fierm which is used as a 

definition of ownership or pecuniary 

interest. Subsection (c)(3)(iii) has been 

added to clarify what portion of jointly 

owned property the candidate’s share is 

considered to be. These changes were 

made as part of the Commission’s 

regulations on “Candidate’s Use of 

Property in Which Spouse Has An 

Interest." For a fuller discussion of these 

changes, see 48 F.R. 19019 (April 27,

1983). Subsection (d) generally follows 

current § 9003.2(d).

Section 9003.3 A llow able

Contributions.

This section has been substantially 

revised and expanded from the current 

regulation. Subsection (a), which 

permits a candidate to establish a legal 

and accounting compliance fund, has 

been limited to major party candidates. 

While minor and new party candidates 

may also make disbursements for legal 

and accounting services to ensure 

compliance with the Act, which 

disbursements would not count against 

the expenditure limit, there is no need 

for those candidates to establish a 

separate account for that purpose as 

they can already accept private 

contributions. Therefore, the need for a 

compliance fund only arises when a 

major party candidate receives full 

federal funding and cannot accept 

private funds except for the purposes 

Permitted by the compliance fund. This

48, No. 133 / Monday, July 11, 1983

rule does not, however, prohibit other 

candidates from establishing separate 

accounts if they so desire.

Subsection (a)(l)(ii) has been revised 

to make clear that excess funds from the 

candidate’s primary account may be 

transferred to the compliance fund 

without regard to the contribution 

limitations. Thus, the candidate need 

not determine which of the funds 

transferred represent contributions 

which would otherwise count against 

the amount those persons could 

contribute to 4he compliance fund.

Subsection (a)(2)(i) has been revised 

to make clear that a portion of payroll, 

overhead and computer services costs 

may be defrayed from the compliance 

fund to the extent such costs relate to 

ensuring compliance with the Federal 

Election Campaign Act and the 

Presidential Election Campaign Fund 

Act. This provision has been patterned 

after 11 CFR 9035.1(c) but has been 

expanded to include computer costs. As 

in section 9035.1(c), a candidate may 

demonstrate that a larger proportion of 

the described costs are related to 

ensuring compliance than the 

percentages provided in this section 

would cover. This section also provides 

that payroll, overhead and computer 

services costs must be initially paid 

from the federal funds account and then t

may be reimbursed by the compliance 

fund at any time before the 

Commission’s final repayment 

determination is made. In the limited 

circumstance in which a bona fide error 

is made and a qualified campaign 

expense is paid from the compliance 

fund, the federal fund account may 

reimburse the compliance fund.

Subsections (a)(2)(iii) and (iv) follow 

current §§ 9003.3(a)(2)(iii) and (iv). • 

Subsection (a)(3) generally follows 

current § 9003.3(a)(3).

Subsection (b) has been revised to 

address major party candidates in the 

event of a deficiency in the Fynd. Such 

candidates may solicit private 

contributions to defray qualified 

campaign expenses in order to make up 

the deficiency. They may choose to 

deposit these contributions in the same 

account as the federal funds received or 

they may deposit them separately. This 

approach is consistent with the 

Commission’s view in the case of 

Presidential primary candidates, who 

may also defray qualified campaign 

expenses from both federal and private 

funds. Subsection (b)(5) follows current 

§ 9003.3(b)(4) but is revised to more 

accurately reflect the provisions of 11 

CFR 100.8(b)(2) and 2 U.S.C.

431(9)(B)(vi).

/ Rules and Regulations

Subsections (b) (5), (6), (7) and (8) 

provide that a candidate may exempt a 

portion of payroll and overhead costs 

from the expenditure limitation as 

fundraising costs. A candidate may also 

exempt a portion of overhead, payroll 

and computer services costs as 

compliance costs. As in subsection (a), 

these provisions follow 11 CFR 9035.1(c).

Subsection (c) contains the provisions 

applicable to minor and new party 

candidates. This subsection has been 

revised from current § 9003.3(b) to 

reflect the Commission’s decision (hat 

one account may be used to defray both 

qualified campaign expenses and the 

costs normally payable from a 

compliance fund. The provisions 

regarding the exemptions for compliance 

and fundraising costs parallel those in 

subsection (b).

The Commission considered and 

rejécted a proposal to add provisions to 

subsections (a) through (c) that would 

have permitted candidates to use 

private contributions deposited in their 

compliance fund or campaign account 

for transition expenses after all other 

obligations including repayments and 

penalties had been paid. In view of the 

“Transition Trust” permitted by 

Advisory Opinion 1980-97 and the funds 

provided under the Presidential 

Transition Act of 1963, Pub. L. 88-277, 78 

Stat. 153, the Commission decided not to 

include a provision to this effect in these 

regulations.

S ection 9003.4 E xpen ses Incurred P rior

to the Beginning o f the Expenditure

R eport P eriod or P rior to R eceip t o f

F ed eral Funds.

This section generally follows current 

§ 9003.4

S ection 9003.5 D ocum entation o f

D isbursem ents.

This section generally follows current 

§ 9003.5. In the Notice of Proposed 

Rulemaking, this section required the 

“identification” of a payee; however, the 

Commission has determined to retain 

the language of the current regulation 

which requires the “full name and 

mailing address” of the payee. The latter 

was retained as a clearer statement of 

the information sought.

In addition, the Commission notes 

that the use of the term “purpose" in this 

section has the same meaning as in 11 

CFR 104.3(b)(4)(i)(A).

Subsection (c) has been added to 

follow the Presidential Primary 

Matching Fund regulations at 11 CFR 

9033.11(c).
31824 Federal Register / Vol. 48, No. 133 / Monday, July 11, 1983 / Rules and Regulations

Part 9004—Entitlement of Eligible 

Candidates to Payments; Use of 

Payments

S ection 9004.1 M ajor P arties.

This section follows current § 9004.1.

S ection 9004.2 P re-E lection Paym ents

fo r M inor an d N ew P arty C andidates.

This section has been divided into 

three parts to set forth separately and in 

detail the conditions which candidates 

of a minor party in the preceding 

election, candidates of a minor party in 

the current election, and new party 

candidates must satisfy to qualify for 

pre-election payments from the Fund. 

Otherwise, this section generally follows 

current § 9004.2.

S ection 9004.3 P ost-election Paym ents.

Subsection (a) generally follows 

current § 9004.3(a) but has been 

reworded for clarification. Subsection 

(b) sets forth the maximum amount of 

payments which may be received and 

generally follows current § 9004.3(c). 

Subsection (c) generally follows current 

§ 9004.3(b).

S ection 9004.4 Use o f Paym ents.

This section has been reorganized to 

provide examples of what may be 

considered qualified and non-qualified 

campaign expenses. The format of this 

section generally follows that of 11 CFR 

9034.4.

S ection 9004.5 Investm ent o f P ublic

Funds.

This section generally follows current 

§ 9004.5 but contains a new provision 

requiring repayment of a net loss 

resulting from the investment of public 

funds. A net loss will be considered a 

non-qualified campaign expense and 

repayable under § 9007.2(b)(2)(i).

S ection 9004.6 R eim bursem ents fo r

Transportation an d S ervices M ade

A v ailable to M edia Personnel.

All references to reimbursement for 

transportation, services and facilities 

made available to the Secret Service or 

other staff authorized by law or required 

by national security to travel with a 

candidate have been deleted from this 

section. Other government regulations 

govern payment for those expenditures.

In subsection (a), language has been 

added to clarify that expenditures for 

services provided to media personnel 

are subject to the overall expenditure 

limitations of 11 CFR 9003.2(a)(1) and 

(b)(1).

Subsection (b) follows the Presidential 

primary’regulations' at 11 CFR 9034.6 

and provides that the reimbursements 

received from each person may not

exceed the total cost of providing 

services to that person by more than 

10%. The 10% figure will be based on the 

total cost of providing services to each 

person over the course of the campaign 

rather than on a per-trip basis. 

Candidates may include the cost of * 

“down-time" for leased aircraft in the 

amount requested for reimbursement as 

this is a cost of providing transportation 

to the media. The reimbursements may 

be deducted from the amount applied to 

the overall expenditure limit but only to 

the extent that the reimbursements do 

not exceed the actual cost to the 

campaign.

S ection 9004.7 A llocation o f T ravel

Expenditures.

This section generally follows current 

§ 9004.7 with one significant change. 

Subsection (b)(5) has been revised to 

require that candidates using 

government conveyance, such as 

government aircraft, pay the equivalent 

of first-class commercial air fare or 

commercial charter fare rather than the 

actual cost of such government 

transportation. Candidates must also 

pay the cost of other government 

conveyances or accommodations used 

such as government-owned cars or 

buses.

S ection 9004.8 W ithdraw al by

C andidate.

This section has been revised to 

delete much of the language regarding 

the statement to be filed by a candidate 

who withdraws. Instead, this section 

now refers to new § 9004.9, which 

consolidates the requirements for 

statements to be filed by all candidates. 

In addition, the time for Ming a 

statement under this section has been 

shortened from 60 to 30 calendar days.

S ection 9004.9 N et O utstanding

Q u alified Cam paign E xpenses.

This new section sets forth 

requirements for filing statements 

similar to the statements of net 

outstanding campaign obligations filed 

by Presidential primary candidates 

under 11 CFR 9034.5. it reflects 

requirements consistent with past 

Commission practice.

Unlike the Presidential primary 

regulations, however, this section sets 

different deadlines for candidates who 

withdraw, candidates seeking postelection funding and all other 

candidates. Candidates seeking postelection funding must file a preliminary 

statement to aid in determining their 

entitlement to public funds as well as a 

statement at the time other candidates 

must submit theirs.

Subsection (d) follows the Presidential 

primary regulations at 11 CFR 8034.5(b). 

Subsection (e) follows 11CFR 9034.5(e),

S ection 9004.10 S ale o f A ssets

A cqu ired fo r Fundraising Purposes.

This new section follows the 

Presidential primary regulations at 11 

CFR 9034.9. Its application here is 

limited, however, to minor and new 

party candidates and to major party 

candidates who have not received full 

federal funding due to a deficiency in 

the Fund.

Part 9005—Certification by Commission

S ection 9005.1 C ertification o f

Paym ents fo r C andidates.

This section reflects the provisions of 

current § § § 9005.1 and 9005.2 but has 

been reorganized and expanded. 

Subsection (a) addresses certification of 

payments for major party candidates. 

Subsection (b) addresses certification of 

pre-election payments for minor and 

new party candidates.

Subsection (c) has been added to 

follow the procedures used by the 

Commission in 1980 to certify postelection payments to minor and new 

party candidates but adds the 

requirement to file a preliminary 

statement of net outstanding qualified 

campaign expenses pursuant to section 

9004.9.

Subsection (d) follows current 

§ 9005.1(b) regarding the finality of 

Commission certifications.

S ection 9005.2 Paym ents to E ligible

C andidates from the Fund. .

This section generally follows current 

§ 9005.3.

Part 9006—Reports and Recordkeeping

S ection 9006.1 S eparate R eports.

This section generally follows current 

§9006.1.

Section 9006.2 Filing D ates.

This section follows current § 9006.2.

Part 9007—Examinations and Audits; 

Repayments

S ection 9007.1 A udits.

Subsection (a)(1) follows current 

§ 9007.1. The remaining provisions of 

this section follow the provisions of the 

Presidential primary regulations at 11 

CFR 9038.1.

S ection 9007.2 R epaym ents.

This section has been reorganized to 

follow the format of the Presidential 

primary regulations at 11-CFR 9038.2.
Federal Register / Vol.

Section 9007.3 E xtensions of Time.

This new section follows the 

Presidential primary regulations at 11 

CFR 9038.4.

Section 9007.4 A ddition al Audits.

This section follows current § 9007.3.

Part 9008—Federal Financing of 

Presidential Nominating Conventions

This Part has not been changed; 

however, the separate subchapter 

designation for this Part has been 

removed and this Part included in 

subchapter E to permit the correct 

numbering of new Part 9012 in 

accordance with the corresponding 

statutory citation. Part 9012 was printed 

as Part 9007a in the Notice of Proposed 

Rulemaking.

Part 9012—Unauthorized Expenditures 

and Contributions

Section 9012.1 E x cessive E xpenses.

This new section follows 26 U.S.C. 

9012(a).

Section 9012.2 U nauthorized

Acceptance o f Contributions.

This new section follows 26 U.S.C. 

9012(b).

Section 9012.3 U nlaw ful U se o f

Payments R eceiv ed from the Fund.

This new section follows 26 U.S.C. 

9012(c).

Section 9012.4 U nlaw ful

Misrepresentations an d F alsification o f

Statements, R ecords or O ther E viden ce

to the Com m ission; R efu sal to Furnish

Books and R ecords.

This new section follows 26 U.S.C. 

9012(d).

Section 9012.5 Kickbacks an d Illeg a l

Payments.

This new section follows 26 U.S.C. 

9012(e). In the Notice of Proposed 

Rulemaking, subsection (c) was 

inadvertently included regarding the 

penalty provisions of 9012(e). This 

subsection was deleted from the . 

regulations in accordance with the 

Commission’s practice of not including 

the statutory penalty provisions in the 

regulations.

Section 9012.6 Unauthorized

Expenditures and Contributions by

Political Committees.

This new section follows 26 U.S.C. 

9012(f).

48, No. 133 / M onday, fuly 11, 1983

List of Subjects

11 CFR Parts 9001, 9002, 9003, 9004 an d

9005

Campaign funds, Political candidates, 

Elections.

11 CFR Part 9006

Campaign funds, Reporting and 

recordkeeping requirements, Political 

candidates, Elections.

11 CFR Part 9007

Campaign funds, Administrative 

practice and procedure, Political 

candidates.

11 CFR Part 9012

Political candidates, Political 

committees and parties, Elections.

11 CFR is amended as follows;

1. By Revising Parts 9001 through 9007 

to read as follows:

PART 9001—SCOPE

§ 9001.1 Scope.

This subchapter governs entitlement 

to and use of funds certified from the 

Presidential Election Campaign Fund 

under 26 U.S.C. 9001 e t seq. The 

definitions, restrictions, liabilities and 

obligations imposed by this subchapter 

are in addition to those imposed by 

sections 431-455 of Title 2, United States 

Code, and regulations prescribed 

thereunder (11 CFR Parts 100 through 

115). Unless expressly stated to the 

contrary, this subchapter does not alter 

the effect of any definitions, restrictions, 

obligations and liabilities imposed by 

sections 431-455 of Title 2 United States 

Code, or regulations prescribed 

thereunder (11 CFR Parts 100 through 

115).

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

PART 9002—DEFINITIONS

Sec.

9002.1 Authorized committee.

9002.2 Candidate.

9002.3 Commission.

9002.4 Eligible candidates.

9002.5 Fund.

9002.6 Major party.

9002.7 Minor party.

9002.8 New party.

9002.9 Political committee.

9002.10 Presidential election.

9002.11 Qualified campaign expense.

9002.12 Expenditure report period.

9002.13 Contribution.

9002.14 Secretary.

9002.15 Political party.

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

§ 9002.1 Authorized committee.

(a) Notwithstanding the definition at 

11 CFR 10CL5, “authorized committee” 

means with respect to a candidate (as 

defined at 11 CFR 9002.2) of a political

/ Rules and Regulations 31825

party for President and Vice President, 

any political committee that is 

authorized by a candidate to incur 

expenses on behalf of such candidate. 

The term “authorized committee” 

includes the candidate’s principal 

campaign committee designated in 

accordance with 11 CFR 102.12, any 

political committee authorized in writing 

by the candidate in accordance with 11 

CFR 102.13, and any political committee 

not disavowed by the candidate 

pursuant to 11 CFR 100.3(a)(3). If a party 

has nominated a Presidential and a Vice 

Presidential candidate, all political 

committees authorized by that party’s 

Presidential candidate shall also be 

authorized committees of the Vice 

Presidential candidate and all political 

committees authorized by the Vice 

Presidential candidate shall also be 

authorized committees of the 

Presidential candidate.

(b) Any withdrawal of an 

authorization shall be in writing and 

shall be addressed and filed in the same 

manner provided for at 11 CFR 102.12 or 

102.13.

(c) Any candidate nominated by a 

political party may designate the 

national committee of that political 

party as that candidate’s authorized 

committee in accordance with 11 CFR 

102.12(c).

(d) For purposes of this subchapter, 

references to the “candidate” and his or 

her responsibilities under this 

subchapter shall also be deemed to refer 

to the candidate's authorized 

committee(s).

§ 9002.2 Candidate.

(a) For the purposes of this 

subchapter, “candidate” means with 

respect to any presidential election, an 

individual who—

(1) Has been nominated by a major 

party for election to the Office of 

President of the United States or the 

Office of Vice-President of the United 

States; or

(2) has qualified or consented to have 

his or her name appear on the general 

election ballot (or to have the names of 

electors pledged to him or her on such 

ballot) as the candidate of a political 

party for election to either such office in 

10 or more States. For the purposes of 

this section, “political party” shall be 

defined in accordance with 11 CFR 

9002.15.

(b) An individual who is no longer 

actively conducting campaigns in more 

than one State pursuant to 11 CFR 9004.8 

shall cease to be a candidate for the 

purpose of this subchapter.
31826 Federal Register / Vol.

§ 9002.3 Commission.

“Commission” means the Federal 

Election Commission, 1325 K Street 

NW„ Washington, D.C. 20463.

§ 9002.4 Eligible candidates.

“Eligible candidates” means those 

Presidential and Vice Presidential 

candidates who have met all applicable 

conditions for eligibility tafeceive 

payments from the Fund under 11 CFR 

Part 9003.

§9002.5 Fund.

“Fund” means the Presidential 

Election Campaign Fund established by 

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

§9002.6 Major party.

“Major party" means a political party 

whose candidate for the office of 

President in the preceding Presidential 

election received, as a candidate of such 

party, 25 percent or more of the total 

number of popular votes received by all 

candidates for such office. For the 

purpose of 11 CFR 9002.6, “candidate" 

means, with respect to any preceding 

Presidential election, an individual who 

received popular votes for the office of 

President in such election.

§ 9002.7 Minor party.

“Minor party” means a political party 

whose candidate for the office of 

President in the preceding Presidential 

election received, as a candidate of such 

party, 5 percent or more, but less than 25 

percent, of the total number of popular 

votes received by all candidates for 

such office. For the purpose of 11 CFR 

9002.7, “candidate” means with respect 

to any preceding Presidential election, 

an individual who received popular 

votes for the office of President in such 

election.

§ 9002.8 New party.

“New party" means a political party 

which is neither a major party nor a 

minor party.

§ 9002.9 Political committee.

For purposes of this subchapter, 

"political committee” means any 

committee, club, association, 

organization or other group of persons 

(whether or not incorporated) which 

accepts contributions or makes 

expenditures for the purpose of 

influencing, or attempting to influence, 

the election of any candidate to the 

office of President or Vice President of 

the United States; except that for the 

purpose of 11 CFR 9012.6, the term 

“political committee” shall be defined in 

accordance with 11 CFR 100.5.

48, No. 133 / Monday, July 11, 1983

§ 9002.10 Presidential election.

“Presidential election” means the 

election of Presidential and Vice 

Presidential electors.

§ 9002.11 Qualified campaign expense.

(a) “Qualified campaign expense” 

means any expenditure, including a 

purchase, payment, distribution, loan, 

advance, deposit, or gift of money or 

anything of value—

(1) Incurred to further a candidate’s

campaign for election to the Office of 

President or Vice President of the 

United States; «

(2) Incurred within the expenditure 

report period, as defined under 11 CFR 

9002.12, or incurred before the beginning 

of such period in accordance with 11 

CFR 9003.4 to the extent such 

expenditure is for property, services or 

facilities to be used during such period; 

and

(3) Neither the incurrence nor the 

payment of such expenditure constitutes 

a violation of any law of the United 

States, any law of the State in which 

such expense is incurred or paid, or any 

regulation prescribed under such 

Federal or State law, except that any 

State law which has been preempted by 

the Federal Election Campaign Act of 

1971, as amended, shall not be 

considered a State law for purposes of 

this subchapter. An expenditure which 

constitutes such a violation shall 

nevertheless count against the 

candidate’s expenditure limitation if the 

expenditure meets the conditions set 

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

(b) (1) An expenditure is made to 

further a Presidential or Vice 

Presidential candidate's campaign if it is 

incurred by or on behalf of such 

candidate or his or her authorized 

committee. For purposes of 11 CFR 

9002.11(b)(1), any expenditure incurred 

by or on behalf of a Presidential 

candidate of a political party will also 

be considered an expenditure to further 

the campaign of the Vice Presidential 

candidate of that party. Any 

expenditure incurred by or on behalf of 

the Vice Presidential candidate will also 

be considered an expenditure to further 

the campaign of the Presidential 

candidate of that party.

(2) An expenditure is made on behalf 

of a candidate if it is made by—

(i) Any-authorized committee or any 

other agent of the candidate for the 

purpose of making an expenditure; or

(ii) Any person authorized or 

requested by the candidate, by the 

candidate’s authorized committee(s), or 

by an agent of the candidate or his or 

her authorized committee(s) to make an 

expenditure; or

/ Rules and Regulations

(iii) A committee which has been 

requested by the candidate, the 

candidate’s authorized committee(s), or 

an agent thereof to make the 

expenditure, even though such 

committee is not authorized in writing.

(3) Any expenditure incurred by a 

candidate or his or her authorized 

committee(s) to further the election of 

any other individual to a Federal, State 

or local office shall be a qualified 

campaign expense to the extent such 

expenditure is to further the candidate’s 

own campaign for election. If the 

expenditure is incurred specifically to 

further the election of such other 

individuals, it will not be considered a 

qualified campaign expense.

(4) Expenditures by a candidate’s 

authorized committee(s) pursuant to 11 

CFR 9004.6 for the travel and related 

ground service costs of media shall be 

qualified campaign expenses. Any 

reimbursement for travel and related 

services costs received by a candidate’s 

authorized committee shall be subject to 

the provisions of 11 CFR 9004.6.

(5) Legal and accounting services 

which are provided solely to ensure 

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

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

campaign expenses which may be paid 

from payments received from the Fund. 

If federal funds are used to pay for such 

services, the payments will count 

against the candidate’s expenditure 

limitation. Payments for such services 

may also be made from an account 

established in accordance with 11 CFR 

9003.3 or may be provided to the 

committee in accordance with 11 CFR 

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

for such services are made from an 

account established in accordance with 

11 CFR 9003.3, the payments do not 

count against the candidate’s 

expenditure limitation. If payments for 

such services are made by a minor or 

new party candidate from an account 

containing private contributions, the 

payments do not count against that 

candidate’s expenditure limitation. The 

amount paid by the committee shall be 

reported in accordance with 11 CFR Part 

9006. Amounts paid by the regular 

employer of the person providing such 

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

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

recipient committee in accordance with 

11 CFR 104.3(h).

(c) Expenditures incurred either 

before the beginning of the expenditure 

report period or after the last day of a 

candidate’s eligibility will be considered 

qualified campaign expenses if they 

meet the provisions of 11 CFR 9004.4(a). 

Expenditures described under 11 CFR
Federal Register / Vol. 48, No. 133 / Monday, July 11, 1983 / Rules and Regulations 31827

9004.4(b) will not be considered 

qualified campaign expenses.

§ 9002.12 Expenditure report period.

“Expenditure report period” means, 

with respect to any Presidential election, 

the period of time described in either 

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

appropriate.

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

expenditure report period begins on 

September 1 before the election or on 

the date on which the major party’s 

presidential nominee is chosen, 

whichever is earlier; and the peirod ends 

30 days after the Presidential election.

(b) In the case of a minor or new 

party, the period will be the same as 

that of the major party with the shortest 

expenditure report period for that 

Presidential election as determined 

under paragraph (a) of this section.

§9002.13 Contribution.

“Contribution" has the same meaning 

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

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

and 11 CFR Parts 114 and 115.

§9002.14 Secretary.

“Secretary” means the Secretary of 

the Treasury.

§ 9002.15 Political party.

“Political party” means an 

association, committee, or organization 

which nominates or selects an 

individual for election to any Federal 

office, including the office of President 

or Vice President of the United States, 

whose name appears on the general 

election ballot as the candidate of such 

association, committee, or organization.

PART 9003—ELIGIBILITY FOR

PAYMENTS

Sec.

9003.1 Candidate and committee

agreements.

9003.2 Candidate certifications.

9003.3 Allowable contributions.

9003.4 Expenses incurred prior to the

beginning of the expenditure report

period or prior to receipt of Federal

funds.

9003.5 Documentation of disbursements.

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

§ 9003.1 Candidate and committee

agreements.

(a) G eneral.

(1) To become eligible to receive 

payments under 11 CFR Part 9005, the 

Presidential and Vice Presidential 

candidates of a political party shall 

agree in a letter signed by the 

candidates to the Commission that they 

and their authorized committee(s) shall 

comply with the conditions set forth in 

W CFR 9003.1(b).

(2) Major party candidates shall sign 

and submit such letter to the 

Commission within 14 days after 

receiving the party’s nomination for 

election. Minor and new party 

candidates shall sign and submit such 

letter within 14 days after such 

candidates have qualified to appear on 

the general election ballot in 10 or more 

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

The Commission, on written request by 

a minor or new party candidate, at any 

time prior to the date of the general 

election, may extend the deadline for 

filing such letter, except that the 

deadline shall be a date prior to the date 

of the general election.

(b) Conditions. The candidates shall:

(1) Agree that they have the burden of 

proving that disbursements made by 

them or any authorized committee(s) or 

agent(s) thereof are qualified campaign 

expenses as defined in 11 CFR 9002.11.

(2) Agree that they and their 

authorized committee(s) shall comply 

with the documentation requirements 

set forth at 11 CFR 9003.5.

(3) Agree that they and their 

authorized committee(s) shall provide 

an explanation, in addition to complying 

with die documentation requirements, of 

the connection between any 

disbursements made by the candidates 

or the authorized committee(s) of the 

candidates and the campaign if 

requested by the Commission.

(4) Agree that they and their 

authorized committee(s) shall keep and 

furnish to the Commission all 

documentation relating to receipts and 

disbursements including any books, 

records (including bank records for all 

accounts), all documentation required 

by this subchapter including those 

required to be maintained under 11 CFR 

9003.5, and other information the 

Commission may request.

(5) Agree that they had their 

authorized committee(s) shall permit an 

audit and examination pursuant to 11 

CFR Part 9007 of all receipts and 

disbursements including those made by 

the candidate, all authorized committees 

and any agent or person authorized to 

make expenditures on behalf of the 

candidates or committee(s). The 

candidate and authorized committee(s) 

shall facilitate the audit by making 

available in one central location, office 

space, records and such personnel as 

are necessary to conduct the audit and 

examination, and shall pay any amounts 

required to be repaid under 11 CFR Part 

9007.

(6) Submit the name and mailing 

address of the person who is entitled to 

receive payments from the Fund on 

behalf of the candidates; the name and 

address of the depository designated by

the candidates as required by 11 CFR 

Part 103 and 11 CFR 9005.2; and the 

name under which each account is held 

at the depository at which the payments 

from the Fund are to be deposited.

(7) Aigree that they and their 

authorized committee(s) shall comply 

with the applicable requirements of 2 

U.S.C. 431 et seq., 26 U.S.C. 9001 et seq.,

and the Commission’s regulations at 11 

CFR Parts 100-115, and 9001-9012.

(8) Agree that they and their 

authorized committee(s) shall pay any 

civil penalties included in a conciliation 

agreement entered into under 2 U.S.C. 

437g against the candidates, any 

authorized committees of the candidates 

or any agent thereof.

§ 9003.2 Candidate certifications.

(a) Major Party Candidates. To be 

eligible to receive payments under 11 

CFR Part 9005, each Presidential and 

Vice Presidential candidate of a major 

party shall, under penalty of perjury, 

certify to the Commission:

(1) That the candidate and his or her 

authorized committee(s) have not 

incurred and will not incur qualified 

campaign expenses in excess of the 

aggregate payments to which they will 

be entitled under 11 CFR Part 9004.

(2) That no contributions have been or 

will be accepted by the candidate or his 

or her authorized committee (s); except 

as contributions specifically solicited 

for, and deposited to, the candidate’s 

legal and accounting compliance fund 

éstablished under 11 CFR 9003.3(a); or 

except to the extent necessary to make 

up any deficiency in payments received 

from the Fund due to the application of 

11 CFR 9005.2(b).

(b) Minor and Major Party

Candidates. To be eligible to receive 

payments under 11 CFR Part 9005, each 

Presidential and Vice Presidéntial 

candidate of a minor or new party shall, 

under penalty of perjury, certify to the 

Commission:

(1) That the candidate and his or her 

authorized committee(s) have not 

incurred and will not incur qualified 

campaign expenses in excess of the 

aggregate payments to which the eligible 

candidates of a major party are entitled 

under 11 CFR 9004.1

(2) That no contributions to defray 

qualified campaign expenses have been 

or will be accepted by the candidate or 

his or her authorized committee(s) 

except to the extent that the qualified 

campaign expenses incurred exceed the 

aggregate payments received by such 

candidate from the Fund under 11 CFR

9004.2.

(c) A ll Candidates. To be eligible to 

receive any payment under 11 CFR
31828 Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations

9004.2, the Presidential candidate of 

each major, minor or new party shall 

certify to the Commission, under penalty 

of perjury, that such candidate will not 

knowingly make expenditures from his 

or her personal funds, or the personal 

funds of his or her immediate family, in 

connection with his or her campaign for 

the office of President in excess of 

$50,000 in the aggregate.

(1) For purposes of this section, the ^ 

term “immediate family” means a 

candidate’s spouse, and any child, 

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

candidate, and the spouses of such 

persons.

(2) Expenditures from personal funds 

made under this paragraph shall not 

apply agains the expenditure limitations.

(3) For purposes of this section, the 

terms “personal funds” and “personal 

funds of his or her immediate family” 

mean:

(i) Any assets which, under applicable 

state law, at the time he or she became a 

candidate, the candidate had legal right 

of access to or control over, and with 

respect to which the candidate had 

either:

- (A) Legal and rightful, title, or

(B) An equitable interest.

(ii) Salary and other earned income 

from bona fide employment; dividends 

and proceeds from the sale of the 

candidate’s stocks or other investments; 

bequests to the candidate; income from 

trusts established before candidacy; 

income from trusts established by 

bequest after candidacy of which the 

candidate is a beneficiary; gifts of a 

personal nature which had been 

customarily received prior to candidacy; 

proceeds from lotteries and similar legal 

games of chance.

(iii) A candidate may use a portion of 

assets jointly owned with his or her 

spouse as personal funds. The portion of 

the jointly owned assets that shall be 

considered as personal funds of the 

candidate shall be that portion which is 

the candidate’s share under the 

instrument(s) of conveyance or 

ownership. If no specific share is 

indicated by any instrument of 

conveyance or ownership, the value of 

one-half of the property used shall be 

considered as personal funds of the 

candidate.

(4) For purposes of this section, 

expenditures front personal funds made 

by a candidate of a political party for 

the office of Vice President shall be 

considered to be expenditures made by 

the candidate of such party for the office 

of President.

(3) Contributions made by members of 

a candidate’s family from funds which 

do not meet the definition of personal

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

count against such candidate’s $50,000 

expenditure limitation under 11 CFR 

9003.2(c).

(6) Personal funds expended pursuant 

to this section shall be first deposited in 

an account established in accordance 

with 11 CFR 9003.3(b) or (c),

(d) Form. Major party candidates shall 

submit the certifications required under 

11 CFR 9003.2 in a letter which shall be 

signed and submitted within 14 days 

after receiving the party’s nomination 

for election. Minor and new party 

candidates shall sign and submit such 

letter within 14 days after such 

candidates have qualified to appear on 

the general election ballot in 10 or more 

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

The Commission, upon written request 

by a minor or new party candidate made 

at any time prior to the date of the 

general election, may extend the 

deadline for filing such letter, except 

that the deadline shall be a date prior to 

the day of the general election.

§ 9003.3 Allowable contributions.

(a) L egal an d A ccounting C om pliance

Fund—M ajor P arty C andidates.—(1) 

Source, (i) A major party candidate may 

accept contributions to a legal and 

accounting compliance fund if such 

contributions are received and 

disbursed in accordance with this 

section. A legal and accounting 

compliance fund may be established by 

such candidate prior to being nominated 

or selected as the candidate of a 

political party for the office of President 

or Vice Resident of the United States.

(A) All solicitations for contributions 

to this fund shall clearly state that such 

contributions are being solicited for this 

fund.

(B) Contributions to this fund shall be 

subject to the limitations and 

prohibitions of 11 CFR Parts 110,114, 

and 115.

(ii) Funds remaining in the primary 

election account of a candidate, which 

funds are in excess of any amount 

required to be reimbursed to the 

Presidential Primary Matching Payment 

Account under 11 CFR 9038.2, may be 

transferred to the legal and accounting 

compliance fund without regard to the 

contribution limitations of 11 CFR Part 

110 and used for any purpose permitted 

under this section.

(iii) Contributions which are made 

after the beginning of the expenditure 

report period but which are designated 

for the primary election may be 

deposited in the legal and accounting 

compliance fund: Provided, That the 

candidate already has sufficient funds 

to pay any outstanding campaign 

obligations incurred during the primary

campaign; and the candidate notifies the 

contributor that his or her contribution 

will be deposited in the compliance 

fund. If after such notification the 

contributor objects to the funds being so 

used, the contribution shall be returned. 

The contribution so received and 

deposited shall be subject to the 

contribution limitations applicable for 

the general election, pursuant to 11 CFR 

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

(2) Uses.

(i) Contributions to the legal and 

accounting compliance fund shall be 

used only for the following purposes:

(A) To defray the cost of legal and 

accounting services provided solely to 

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

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

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

(B) To defray in accordance with 11 

CFR 9003.3(a)(2)(ii)(A), that portion of 

expenditures for payroll, overhead, and 

computer services related to ensuring 

compliance with 2 U.S.C. 431 et seq. and 

26 U.S.C. 9001 et seq .;

(C) To defray any civil or criminal 

penalties imposed pursuant to 2 U.S.C. 

437g or 26 U.S.C. 9012;

(D) To make repayments under 11 

CFR 9007.2;

(E) To defray the cost of soliciting 

contributions to the legal and accounting 

compliance fund; and

(F) To make a loan to an account 

established pursuant to 11 CFR 9003.4 to 

defray qualified campaign expenses 

incurred prior to the expenditure report 

period or prior to receipt of federal 

funds, provided that the amounts so 

loaned are restored to the legal and 

accounting compliance fund.

(ii) (A) Expenditures for payroll 

(including payroll taxes), overhead and 

computer services,'a portion of which 

are related to ensuring compliance with 

Title 2 and Chapter 95 of Title 26, shall 

be initially paid from the candidat&’s 

federal fund account under 11 CFR 

9005.2 and may be later reimbursed by 

the compliance fund. For purposes of 11 

CFR 9003.3(a)(2)(i)(B), a candidate may 

use contributions to the compliance fund 

to reimburse his or her federal fund 

account an amount equal to 10 percent 

of the payroll and overhead 

expenditures of his or her national 

campaign headquarters and state 

offices. Overhead expenditures include, 

but are not limited to rent, utilities, 

office equipment, furniture, supplies and 

telephone base service charges. In 

addition, a candidate may use 

contributions to the compliance fund to 

reimburse his or her federal fund 

account an amount equal to 70 percent 

of the costs (other than payroll) 

associated with computer services. Such
Federal Register / Vol.

costs include but are not limited to 

rental and maintenance of computer 

equipment, data entry services not 

performed by committee personnel, and 

related supplies. If the candidate wishes 

to claim a larger compliance exemption 

for payroll or overhead expenditures, 

the candidate shall establish allocation 

percentages for each individual who 

spends all or a portion of his or her time 

to perform duties which are considered 

necessary to ensure compliance with 

Title 2 or Chapter 95 of Title 26. The 

candidate shall keep detailed records to 

support the derivation of each 

percentage. Such records shall indicate 

which duties are considered compliance 

and the percentage of time each person 

spends on such activity. If the candidate 

wishes to claim a larger compliance 

exemption for costs associated with 

computer services, the candidate shall 

establish allocation percentages for 

each computer function that is 

considered necessary, in whole or in 

part, to ensure compliance with 2 U.S.C. 

431 etseq. and 26 U.S.C. 9001 et seq. The 

allocation shall be based on a 

reasonable estimate of the costs 

associated with each computer function, 

such as the costs for data entry services 

performed by persons other than 

committee personnel and processing 

time. The candidate shall keep detailed 

records to support such calculations.

The records shall indicate which 

computer functions are considered 

compliance-related and shall reflect 

which costs are associated with each 

computer function.

(B) Reimbursement from the 

compliance fund may be made to the 

separate account maintained for federal 

funds under 11 CFR 9005.2 for legal and 

accounting compliance services 

disbursements that are initially paid 

from the separate federal funds account. 

Such reimbursement must be made prior 

to any final repayment determination by 

the Commission pursuant to 11 CFR

9007.2. Any amounts so reimbursed to 

the federal fund account may not 

subsequently be transferred back to the 

legal and accounting compliance fund.

. (hi) Amounts paid from this account 

for the purposes permitted by 11 CFR 

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

be subject to the expenditure limits of 2 

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

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

proceeds of loans made in accordance 

with 11 CFR 9003.2(a)(2)(i)(F) are 

expended on qualified campaign 

expenses, such expenditures shall count 

against the candidate’s expenditure 

limit.

(iv) Contributions to or funds 

deposited in the legal and accounting '

48, No. 133 / M onday, July 11, 1983 / Rules and Regulations 31829

compliance fund may not be used to 

retire debts remaining from the 

Presidential primaries, except that, if 

after payment of all expenses relating to 

the general election, there are excess 

campaign funds, such funds may be 

used for any purpose permitted under 2 

Ù.S.C. 439a and 11 CFR Part 113, 

including payment of primary election 

debts.

(3) Deposit and disclosure.

(i) Amounts received pursuant to 11 

CFTR 9003.3(a)(1) shall be deposited and 

maintained in an account separate from 

that described in 11 CFR 9005.2 and 

shall not be commingled with any 

money paid to the candidate by the 

Secretary pursuant to 11 CFR 9005.2.

(ii) The receipts to and disbursements 

from this account shall be reported in a 

separate report in accordance with 11 

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

to this account shall be recorded in 

accordance with 11 CFR 102.9.. 

Disbursements made from this account 

shall be documented in the same 

manner provided in 11 CFR 9003.5.

(b) Contributions to Defray Qualified

Campaign Expenses—Major Party

Candidates. (1) A major party candidate 

or his or her authorized committee(s) 

may solicit contributions to defray 

qualified campaign expenses to the 

extent necessary to make up any 

deficiency in payments received from 

the Fund due to the application of 11 

CFR 9005.2(b). .

(2) Such contributions may be 

deposited in a separate account or may 

be deposited with federal funds received 

under 11 CFR 9005.2. Disbursements 

from this account shall be made only to 

defray qualified campaign expenses and 

to defray the cost of soliciting 

contributions to such account. All 

disbursements from this account shall 

be documented in accordance with 11 

CFR 9003.5 and shall be reported in 

accordance with 11 CFR 9006.1.

(3) A candidate may make transfers to 

this account from his or her legal and 

accounting compliance fund.

(4) The contributions received under 

this section shall be subject to the 

limitations and prohibitions of 11 CFR 

Parts 110,114 and 115 and shall be 

aggregated with all contributions made 

by the same persons to the candidate’s 

legal and accounting compliance fund 

under 11 CFR 9003.3(a) for the purposes 

of such limitations.

(5) Any costs incurred for soliciting 

contributions to this account shall not 

be considered expenditures to the extent 

that the aggregate of such costs does not 

exceed 20 percent of the expenditure 

limitation under 11 CFR 9003.2(a)(1). 

These costs shall, however, be reported

as disbursements in accordance with 11 

CFR Part 104 and 11 CFR 9006.1. For 

purposes of this section, a Candidate 

may exclude from the expenditure 

limitation an amount equal to 10% of the 

payroll (including payroll taxes) and 

overhead expenditures of his or her 

national campaign headquarters and 

state offices as exempt fundraising 

costs.

(6) Any costs incurred for legal and 

accounting services which are provided 

solely to ensure compliance with 2 

U.S.C. 431 et seq. and 26 U.S.C. 9001 et

seq. shall not count against the 

candidate’s expenditure limitation. For 

purposes of this section, a candidate

. may exclude from the expenditure 

limitation an amount equal to 10% of the 

payroll (including payroll taxes) and 

overhead expenditures of his or her 

national campaign headquarters and 

state offices. In addition, a candidate 

may exclude from the expenditure 

limitation an amount equal to 70% of the 

costs (other than payroll) associated 

with computer services.

(i) For purposes of 11 CFR 9003.3(b)(6), 

overhead costs include, but are not 

limited to, rent, utilities, office 

equipment, furniture, supplies and 

telephone base service charges.

(ii) For purposes of 11 CFR 9003.3(b)(6) 

costs associated with computer services 

include but are not limited to, rental and 

maintenance of computer equipment, 

data entry services not performed by 

committee personnel, and related 

supplies.

(7) If the candidate wishes to claim a 

larger compliance or fundraising 

exemption under 11 CFR 9003.3(b) (5) or

(6) for payroll and overhead 

expenditures, the candidate shall 

establish allocation percentages for 

each individual who spends all or a 

portion of his or her time to perform 

duties which are considered compliance 

or fundraising. The candidate shall keep 

detailed records to support the 

derivation of each percentage. Such 

records shall indicate which duties are 

considered compliance or fundraising 

and the percentage of time each person 

spends on such activity.

(8) If the candidate wishes to claim a 

larger compliance exemption under 11 

CFR 9003.3(b)(6) for costs associated 

with computer services, the candidate 

shall establish allocation percentages 

for each computer function that is 

considered necessary, in whole or in 

part, to ensure compliance with 2 U.S.C. 

431 et seq. and 26 U.S.C. 9001 et seq. The 

allocation shall be based on a 

reasonable estimate of the costs 

associated with each computer function, 

such as the costs for data entry services
31830 Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations

performed by other than committee 

personnel and processing time. The 

candidate shall keep detailed records to 

support such calculations. The records 

shall indicate which computer functions 

are considered compliance-related and 

shall reflect which costs are associated 

with each computer function.

fc) Contributions to Defray Qualified

Campaign Expenses—Minor and New

Party Candidates. (1) A minor or new 

party candidate may solicit 

contributions to defray qualified 

campaign expenses which exceed the 

amount received by such candidate from 

the Fund, subject to the limits of 11 CFR 

9003.2(b).

(2) The contributions received under 

this section shall be subject to the 

limitations and prohibitions of 11 CFR 

Parts 110,114 and 115.

(3) Such contributions may be 

deposited in a separate account or may 

be deposited with federal funds received 

under 11 CFR 9005.2. Disbursements 

from this account shall be made only for 

the following purposes:

(i) To defray qualified campaign 

expenses;

(ii) To make repayments under 11 CFR 

9007.2;

(iii) To defray the cost of soliciting 

contributions to such account;

(iv) To defray „the cost of legal and 

accounting services provided solely to 

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

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

(4) All disbursements from this 

account shall be documented in 

accordance with 11 CFR 9003.5 and shall 

be reported in accordance with 11 CFR 

Parts 104 and 9006.1.

(5) Any costs incurred for soliciting 

contributions to this account shall not 

be considered expenditures to the extent 

that the aggregate of such costs does not 

exceed 20 percent of the expenditure 

limitation under 11 CFR 9003.2(a)(1). 

These costs shall, however, be reported 

as disbursements in accordance with 11 

CFR Part 104 and 9006.1. For purposes of 

this section, a candidate may exclude 

from the expenditure limitation an 

amount equal to 10 percent of the 

payroll (including payroll taxes) and 

overhead expenditures of his or her 

national campaign headquarters and 

state offices as exempt fundraising 

costs.

(6) Any costs incurred for legal and 

accounting'services which are provided 

solely to ensure compliance with 2 

U.S.C. 431 et seq. and 26 U.S.C. 9001 et

seq. shall not count against the 

candidate’s expenditure limitation. For 

purposes of this section, a candidate 

may exclude from the expenditure 

limitation an amount equal to 10 percent 

of the payroll (including payroll taxes)

and overhead expenditures of his or her 

national campaign headquarters and 

state offices. In addition, a candidate 

may exclude from the expenditure 

limitation an amount equal to 70 percent 

of the costs (other than payroll) 

associated with computer services.

(i) For purposes of 11 CFR 9003.3(c)(6), 

overhead costs include, but are not 

limited to, rent, utilities, office 

equipment, furniture, supplies and 

telephone base services charges.

(ii) For purposes of 11 CFR 9003.3(c)(6) 

costs associated with computer services 

include but are not limited to, rental and 

maintenance of computer equipment, 

data entry services not performed by 

committee personnel, and related 

supplies.

(7) If the candidate wishes to claim a 

larger compliance or fundraising 

exemption under 11 CFR 9003.3(c)(6) for 

payroll and overhead expenditures, the 

candidate shall establish allocation 

percentages for each individual who 

spends all or a portion of his or her time 

to perform duties which are considered 

compliance or fundraising. The 

candidate shall keep detailed records to 

support the derivation of each 

percentage. Such records shall indicate 

which duties are considered compliance 

or fundraising and the percentage of 

time each person spends on such 

activity.

(8) If the candidate wishes to claim a 

larger compliance exemption under 11 

CFR 9003.3(c)(6) for costs associated 

with computer services, the candidate 

shall establish allocation percentages 

for each computer function that is 

considered necessary, in whole or in 

part, to ensure compliance with 2 U.S.C. 

431 et seq. and 26 U.S.C. 9001 et seq. The 

allocation shall be based on a 

reasonable estimate of the costs 

associated with each computer function, 

such as the costs for data entry services 

performed by other than committee 

personnel and processing time. The 

candidate shall keep detailed records to 

support such calculations. The records 

shall indicate which computer functions 

are considered compliance-related and 

shall reflect which costs are associated 

with each computer function.

(9) The candidate shall keep and 

maintain a separate record of 

disbursements made to defray exempt 

legal and'accounting costs under 11 CFR 

9003.3(c)(6) and (7) and shall report such 

disbursements in accordance with 11 

CFR Part 104 and 11 CFR 9006.1.

§ 9003.4 Expenses incurred prior to the

beginning of the expenditure report period

or prior to receipt of Federal funds.

(a) Permissible Expenditures. (1) A 

candidate may incur expenditures

before the beginning of the expenditure 

report period, as defined at 11 CFR 

9002.12, if such expenditures are for 

property, services or facilities which are 

to be used in connection with his or her 

general election campaign and which 

are for use during the expenditure report 

period. Such expenditures will be 

considered qualified campaign 

expenses. Examples of such 

expenditures include but are not limited 

to: Expenditures for establishing 

financial accounting systems, 

expenditures for organizational planning 

and expenditures for polling.

(2) A candidate may incur qualified 

campaign expenses prior to receiving 

payments under 11 CFR Part 9005.

(b) Sources. (1) A candidate may 

obtain a loan which meets the 

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

loans in the ordinary course of business 

to defray permissible expenditures 

described in 11 CFR 9003.4(a). A 

candidate receiving payments equal to 

the expenditure limitation in 11 CFR 

110.8 shall make full repayment of 

principal and interest on such loans 

from payments received by the 

candidate under 11 CFR Part 9005 within 

15 days of receiving such payments.

(2) A major party candidate may 

borrow from his or her legal and 

accounting compliance fund for the 

purposes of defraying permissible 

expenditures described in 11 CFR 

9003.4(a). All amounts borrowed from 

the legal and aqcounting compliance 

fund must be restored to such fund after 

the beginning of the expenditure report 

period either from federal funds 

received under 11 CFR Part 9005 or 

private contributions received under 11 

CFR 9003.3(b). For candidates receiving 

federal funds, restoration shall be made 

within 15 days after receipt of such 

funds.

(3) A minor or new party candidate 

may defray such expenditures from 

contributions received in accordance 

with 11 CFR 9003.3(c).

(4) (i) A candidate who has received 

federal funding under 11 CFR Part 9031 

et seq., may borrow from his or her 

primary election campaign an amount 

not to exceed the residual balance 

projected to remain in the candidate’s 

primary account(s) on the basis of the 

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

major party candidate receiving 

payments equal to the expenditure 

limitation shall reimburse amounts 

borrowed from his or her primary 

campaign from payments received by 

the candidate under 11 CFR Part 9005 

within 15 days of such receipt.

(ii) A candidate who has notteceived

federal funding during the primary
Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations 31831

campaign may borrow at any time from 

his or her primary account(s) to defray 

such expenditures, provided that a 

major party candidate receiving 

payments equal to the expenditure 

limitation shall reimburse all amounts 

borrowed from his or her primary 

campaign from payments received by 

the candidate under 11 CFR Part 9005 

within 15 days of such receipt.

(5) A candidate may use personal 

funds in accordance with 11 CFR 

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

defray such expenditures.

(c) Deposit and Disclosure. Amounts 

received or borrowed by a candidate 

under 11 CFR 9003.4(b) to defray 

expenditures permitted under 11 CFR 

9003.4(a) shall be deposited in a 

separate account to be used only for 

such expenditures. All receipts and 

disbursements from such account shall 

be reported pursuant to 11 CFR 9006.1(a) 

and documented in accordance with 11 

CFR 9003.5.

§ 9003.5 Documentation of

disbursements.

(a) Burden of Proof. Each candidate 

shall have the burden of proving that 

disbursements made by the candidate or 

his dr her authorized committee(s) or 

persons authorized to make 

expenditures on behalf of the candidate 

or authorized committee(s) are qualified 

campaign expenses as defined in 11 CFR 

9002.11. The candidate and his or her 

authorized committee(s) shall obtain 

and furnish to the Commission at its 

request any evidence regarding qualified 

campaign expenses made by the 

candidate, his or her authorized 

committees and agents or persons 

authorized to make expenditures on 

behalf of the candidate or committee(s) 

as provided in 11 CFR 9003.5(b). '

(b) Documentation Required. (1) For 

disbursements in excess of $200 to a 

payee, the candidate shall present 

either:

(i) A receipted bill from the payee that 

states the purpose of the disbursement;

(ii) If such a receipt is not available, a 

cancelled check negotiated by the 

payee, and

(A ) One of the following documents 

generated by thp payee: a bill, invoice, 

or voucher that states the purpose of the 

disbursement; or

(B) Where the documents specified in 

11 CFR 9003.5(b)(l)(ii)(A) are not 

available, a voucher or 

contemporaneous memorandum from 

the candidate or the committee that 

states the purpose of the disbursement;

or

(iii) If neither a receipted bill as 

specified in 11 CFR 9003.5(b)(l)(i) nor

the supporting documentation specified 

in 11 CFR 9003.5(b)(1)(h) is available, a 

cancelled check negotiated by the payee 

that states the purpose of the 

disbursement.

(iv) Where the supporting 

documentation required in 11 CFR 

9003.5(b)(1) (i), (ii) or (iii) is not 

available, the candidate or committee 

may present a cancelled check and 

collateral evidence to document the 

qualified campaign expense. Such 

collateral evidence may include but,is 

not limited to:

(A) Evidence demonstrating that the 

expenditure is part of an identifiable 

program or project which is otherwise 

sufficiently documented such as a 

disbursement which is one of a number 

of documented disbursements relating to 

a campaign mailing or to the operation 

of a campaign office;

(B) Evidence that the disbursement is

covered by a pre-established written 

campaign committee policy, such as a 

per diem policy. .■■■■■<■

(2) For all other disbursements the 

candidate shall present:

(i) A record disclosing the full name 

and mailing address of the payee, the 

amount, date and purpose of the 

disbursement, if made from a petty cash 

fund; or

(iii) A cancelled check negotiated by 

the payee that states the full name and 

mailing address of the payee, and the 

amount, date and purpose of the 

disbursement.

(3) For purposes of this section:

(i) “Payee" means the person who 

provides the goods or services to the 

candidate or committee in return for the 

disbursement; except that an individual 

will be considered a payee under this 

section if he or she receives $500 or less 

advanced for travel and/or subsistence 

and if the individual is the recipient of 

the goods or services purchased.

(ii) “Purpose” means the full name 

and mailing address of the payee, the 

date and amount of the disbursement, 

and a brief description of the goods or 

services purchased.

(c) Retention of Records. The 

candidate shall retain records with 

respect to each disbursement and 

receipt, including bank records, 

vouchers, worksheets, receipts, bills and 

accounts, journals, ledgers, fundraising 

solicitation material, accounting systems 

documentation, and any related 

materials documenting campaign 

receipts and disbursements, for a period 

of three years pursuant to 11 CFR 

102.9(c), and shall present these records 

to the Commission on request.

PART 9004—ENTITLEMENT OF

ELIGIBLE CANDIDATES TO

PAYMENTS; USE OF PAYMENTS

Sec.

9004.1 Major parties.

9004.2 Pre-election payments for minor and 

new party candidates.

9004.3 Post-election payments.

9004.4' Use of payments.

9004.5 Investment of public funds.

9004.6 Reimbursements for transportation 

and services made available to media 

personnel.

9004.7 Allocation of travel expenditures.

9004.8 Withdrawal by candidate.

9004.9 Net outstanding qualified campaign 

expenses.

9004.10 Sale of assets acquired for 

fundraising purposes.

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

§ 9004.1 Major parties.

The eligible candidates of each major 

party in a Presidential election shall be 

entitled to equal payments under 11 CFR 

Part 9005 in an amount which, in the 

aggregate, shall not exceed $20,000,000 

as adjusted by the Consumer Price 

Index in the manner described in 11 CFR 

110.9(c).

§ 9004.2 Pre-election payments for minor

and new party candidates.

(a) Candidate of a Minor Party in the

Preceding Election. An eligible 

candidate of a minor party is entitled to 

pre-election payments:

(1) If he or she received at least 5% of 

the total popular vote as the candidate 

of a minor party in the preceding 

election whether or not he or she is the 

same minor party’s candidate in this 

election.

(2) In an amount which is equal, in the 

aggregate, to a proportionate share of 

the amount to which major party 

candidates are entitled under 11 CFR 

9004.1. The aggregate amount received 

by a minor party candidate shall bear 

the same ratio to the amount received 

by the major party candidates as the 

number of popular votes received by the 

minor party Presidential candidate in 

the preceding Presidential election bears 

to the average number of popular votes 

received by all major party candidates 

in that election.

(b) Candidate of a Minor Party in the

Current Election. The eligible candidate 

of a minor party whose candidate for 

the office of President in the preceding 

election received at least 5% but less 

than 25% of the total popular vote is 

eligible to receive pre-election 

payments. The amount which a minor 

party candidate is entitled to receive 

under this section shall be computed 

pursuant to 11 CFR 9004.2(a) based on 

the number of popular votes received by
31832 ' Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations

the minor party’s candidate in the 

preceding Presidential election; 

however, the amount to which the minor 

party candidate is entitled under this 

section shall be reduced by the amount 

to which the minor party’s Presidential 

candidate in this election is entitled 

under 11 CFR 9004.2(a), if any.

(c) New Party Candidate. A candidate 

of a new party who was a candidate for 

the office of President in at least 10 

States in the preceding election may be 

eligible to receive pre-election payments 

if he or she received at least 5% but less 

than 25% of the total popular vote in the 

preceding election. The amount which a 

new party candidate is entitled to 

receive under this section shall be 

computed pursuant to 11 CFR 9004.2(a) 

based on the number of popular votes 

received by the new party candidate in 

the preceding election. If a new party 

candidate is entitled to payments under 

jjiis section, the amount of the 

entitlement shall be reduced by the 

amount to which the candidate is 

entitled under 11 CFR 9004.2(a), if any.

§ 9004.3 Post-election payments.

(a) Minor and New Party Candidates.

Eligible candidates of a minor party or 

of a new party who, as candidates, 

receive 5 percent or more of the total 

number of popular votes cast for the 

office of President in the election shall 

be entitled to payments under 11 CFR 

Part 9005 equal, in the aggregate, to a 

proportionate share of the amount 

allowed for major party candidates 

under 11 CFR 9004.1. The amount to 

which a minor or new party candidate is 

entitled shall bear the same ratio to the 

amount received by the major party 

candidates as the number of popular 

votes received by the minor or new 

party candidate in the Presidential 

election bears to the average number of 

popular votes received by the major 

party candidates for President in that 

election.

(b) Amount of Entitlement. The 

aggregate payments to which an eligible 

candidate shall be entitled shall not 

exceed an amount equal to the lower of:

(1) The amount of qualified campaign 

expenses incurred by such eligible 

candidate and his or her authorized 

committee(s), reduced by the amount of 

contributions which are received to 

defray qualified campaign expenses by 

such eligible candidate and such 

committee(s); or

(2) The aggregate payments to which 

the eligible candidates of a major party 

are entitled under 11 CFR 9004.1, 

reduced by the amount of contributions 

received by such eligible candidates and 

their authorized committees to defray

qualified campaign expenses in the case 

of a deficiency in the Fund.

(c) Amount of Entitlement Limited By

Pre-Election Payment. If an eligible 

candidate is entitled to payment under 

11 CFR 9004.2, the amount allowable to 

that candidate under this section shall 

also be limited to the amount, if any, by 

which the entitlement under 11 CFR 

9004.3(a) exceeds the amount of the 

entitlement under 11 CFR 9004.2.

§ 9004.4 Use of payments.

(a) Qualified Campaign Expenses. An 

eligible candidate shall use payments 

received under 11 CFR Part 9005 only for 

the following purposes;

(1) A candidate may use such 

payments to defray qualified campaign 

expenses;

(2) A candidate may use such 

payments to repay loans that meet the 

requirements of 11 CFR 100.7(a)(1) or 

100.7(b)(ll) or to otherwise restore funds 

(other than contributions received 

pursuant to 11 CFR 9003.3(b) and 

expended to defray qualified campaign 

expenses) used to defray qualified 

campaign expenses;

(3) A candidate may use such 

payments to restore funds expended in 

accordance with 11 CFR 9003.4 for 

Qualified campaign expenses incurred 

by the candidate prior to the beginning 

of the expenditure report period.

(4) Winding down costs. The following 

costs shall be considered qualified 

campaign expenses:

(1) Costs associated with the 

termination of that candidate’s general 

election campaign such as complying 

with the post-election requirements of 

the Act and other necessary 

administrative costs associated with 

winding down the campaign, including 

office space rental, staff salaries and 

office supplies; or

(ii) Costs incurred by the candidate 

prior to the end of the expenditure 

report period, for which written 

arrangement or commitment was made 

on or before the close of the expenditure 

report period.

(b) Non-qualified campaign

expenses.—(1) General. The following 

are examples of disbursements that are 

not qualified campaign expenses.

(2) Excessive Expenditures. An 

expenditure which is in excess of any of 

the limitations under 11 CFR 9003.2 shall 

not be considered a qualified campaign 

expense.

(3) Expenditures Incurred After the

Close of the Expenditure Report Period.

Any expenditures incurred after the 

close of the expenditure report period, 

as defined in 11 CFR 9002.12, are not 

qualified campaign expenses except to

the extent permitted under 11 CFR 

9004.4(a)(4).

(4) Civil or Criminal Penalties. Civil 

or criminal penalties paid pursuant to 

the Federal Election Campaign Act are 

not qualified campaign expenses and 

cannot be defrayed from payments 

received under 11 CFR Part 9005. Any 

amounts received or expended to pay 

such penalties shall not be considered 

contributions or expenditures but all 

amounts so received shall be subject to 

the prohibitions of the Act. Amounts 

received and expended under this 

section shall be reported in accordance 

with 11 CFR Part 104.

(5) Solicitation Expenses. Any 

expenses incurred by a major party 

candidate to solicit contributions to a 

legal and accounting compliance fund 

established pursuant to 11 CFR 9003.3(a) 

are not qualified campaign expenses 

and cannot be defrayed from payments 

received under 11 CFR Part 9005.

§ 9004.5 Investment of public funds.

Investment of public funds or any 

other use of public funds to generate 

income is permissible, provided that an 

amount equal to all net income derived 

from such investments, less Federal, 

State and local taxes paid on such 

income, shall be repaid to the Secretary. 

Any net loss resulting from the 

investment of public funds will be 

considered a non-qualified campaign 

expense and an amount equal to the 

amount of such net loss shall be repaid 

to the United States Treasury as 

provided under 11 CFR 9007.2(b)(2)(i).

§ 9004.6 Reimbursements for

transportation and services made available

to media personnel.

(a) If an authorized committee incurs 

expenditures for transportation, ground 

services and facilities (including air 

travel, ground transportation, housing, 

meals, telephone service, typewriters) 

made available to media personnel, 

such expenditures will be considered 

qualified campaign expenses subject to 

the overall expenditure limitation of 11 

CFR 9003.2(a)(1) and (b)(1).

(b) If reimbursement for such 

expenditures is received by a 

committee, the amount of such 

reimbursement for each individual shall 

not exceed either: the individual’s pro 

rata share of the actual cost of the 

transportation and services made 

available; or a reasonable estimate of 

the individual’s pro rata share of the 

actual cost of the transportation and 

services made available. An individual s 

pro rata share shall be calculated by 

dividing the total number of individuals 

to whom such transportation and
31833 Federal Register / Vol.

services are made available into the 

total cost of the transportation and 

services. The total amount of 

reimbursements received from an 

individual under this section shall not 

exceed the actual pro rata cost of the 

transportation and services made 

available to that person by more than 

10%. Reimbursements received in 

compliance with the requirements of this 

section may be deducted from the ■ 

amount of expenditures that are subject 

to the overall expenditure limitation of 

11 CFR 9003.2(a)(1) and (b)(1), except to 

the extent that such reimbursements 

exceed the amount actually paid by the 

committee for the services provided.

(c) The total amount paid by an 

authorized committee for the cost of 

transportation or for ground services 

and facilities shall be reported as an 

expenditure in accordance with 11 CFR 

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

received by such committee for 

transportation or ground services and 

facilities shall be reported in accordance 

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

§ 9004.7 Allocation of travel expenditures.

(a) Notwithstanding the provisions of 

11 CFR Part 106, expenditures for travel 

relating to a Presidential or Vice 

Presidential candidate’s campaign by 

any individual, including a candidate, 

shall, pursuant to the provisions of 11^, 

CFR 9004.7(b), be qualified campaign 

expenses and be reported by the 

candidate’s authorized committee(s) as 

expenditures.

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

campaign-related, the total cost of the 

trip shall be a qualified campaign 

expense and a reportable expenditure.

(2) For a trip which includes 

campaign-related and non-campaign 

related stops, that portion of the cost of 

the trip allocable to campaign activity 

shall be a qualified campaign expense 

and a reportable expenditure. Such 

portion shall be determined by 

calculating what the trip would have 

cost from the point of origin of the trip to 

the first campaign-related stop and from 

the stop through each subsequent 

campaign-related stop to the point of 

origin. If any campaign activity, other 

than incidental contacts, is conducted at 

a stop, that stop shall be considered 

campaign-related,

(3) For each trip, an itinerary shall be 

prepared and such itinerary shall be 

made available for Commission 

inspection.

(4) For trips by government 

conveyance or by charter, a list of all 

passengers on such trip, along with a 

designation of which passengers are and 

which are not campaign-related, shall be

48, No. 1 3 3 Monday, July 11, 1983

made available for Commission 

inspection.

(5) If any individual, including a 

candidate, uses government conveyance 

or accommodations paid for by a 

government entity for campaign-related 

travel, the candidate’s authorized 

committee shall pay the appropriate 

government entity an amount equal to:

(i) The first class commercial air fare 

plus the cost of other services,* in the 

case of travel to a city served by a 

regularly scheduled commercial service; 

or

(ii) The commercial charter rate plus 

the cost of other services, in the case of 

travel to a city not served by a regularly 

scheduled commercial service.

(6) Travel expenses of a candidate’s 

spouse and family when accompanying 

the candidate on campaign-related 

travel may be treated as qualified 

campaign expenses and reportable 

expenditures. If the spouse or family 

members conduct campaign-related 

activities, their travel expenses shall be 

qualified campaign expenses and 

reportable expenditures.

(7) If any individual, including a 

candidate, incurs expenses for 

campaign-related travel, other than by 

use of government conveyance or 

accommodations, an amount equal to 

that portion of the actual cost of the 

conveyance or accommodations which 

is allocable to all passengers, including 

the candidate, travelling for campaign 

purposes shall be a qualified campaign 

expense and shall be reported by the 

committee as an expenditure.

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

cost for each passenger shall be 

determined by dividing the total 

operating cost for the charter by the 

total number of passengers transported. 

The amount which is a qualified 

campaign expense and a reportable 

expenditure shall be calculated in 

accordance with the formula set forth at 

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

actual cost per passenger multiplied by 

the number of passengers travelling for 

campaign purposes.

(ii) If the trip is by non-charter 

commercial transportation, the actual 

cost shall be calculated in accordance 

with the formula set forth at 11 CFR 

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

commercial fare. Such actual cost shall 

be a qualified campaign expense and a 

reportable expenditure.

§ 9004.8 Withdrawal by candidate.

(a) Any individual who is not actively 

conducting campaigns in more than one 

State for the office of President or Vice 

President shall cease to be a candidate 

under 11 CFR 900.2.

/ Rules and Regulations

(b) An individual who ceases to be a 

candidate under this section shall:

(1) No longer be eligible to receive any 

payments under 11 CFR 9005.2 except to 

defray qualified campaign expenses as 

provided in 11 CFR 9004.4.

(2) Submit a statement, within 30 

calendar days after he or she ceases to 

be a candidate, setting forth the 

information required under 1^ CFR 

9004.9(c).

§ 9004.9 Net outstanding qualified

campaign expenses.

(a) Candidates Receiving PostElection Funding. A candidate who is 

eligible to receive post-election 

payments under 11 CFR 9004.3 shall file, 

no later than 20 calendar days after the 

date of the election, a preliminary 

statement of that candidate’s net 

outstanding qualified campaign 

expenses. The preliminary statement 

shall be signed by the treasurer of the 

candidate’s principal campaign 

committee. The candidate’s net 

outstanding qualified campaign 

expenses under this section equal the 

difference between 11 CFR 9004.9 (a)(1) 

and (2).

(1) The total of:

(1) All outstanding obligations for 

qualified campaign expenses as of the 

date of the election; plus

(ii) An estimate of the amount of 

qualified campaign expenses that will 

be incurred by the end of the 

expenditure report period; plus

(iii) An estimate of necessary winding 

down costs as defined under 11 CFR 

9004.4(a)(4); less

(2) The total of:

(i) Cash and hand as of the close of 

business on the day of the election 

(including all contributions dated on or 

before that date);

(ii) The fair market value of capital 

assets and other assets on hand; and

(iii) Amounts owed to the campaign in 

the form of credits, refunds of deposits, 

returns, receivables, or rebates of 

qualified campaign expenses; or a 

commercially reasonable amount based 

on the collectibility of those credits, 

returns, receivables or rebates.

- (b) All Candidates. Each candidate, 

except for individuals who have 

withdrawn pursuant to 11 CFR 9004.8, 

shall submit a statement of net 

outstanding qualified campaign 

expenses no later than 30 calendar days 

after the end of the expenditure report 

period. This statement shall be signed 

by the treasurer of the candidate’s 

principal campaign committee. The 

statement shall contain the information 

required by 11 CFR 9004.9(a) (1) and (2), 

except that the amount of outstanding
31834 Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations

obligations under 11 CFR 9004.9(a)(l)(i) 

and the amount of cash on hand, assets 

and receivables under 11 CFR 

9004.9(a)(2) shall be complete as of the 

last day of the expenditure report 

period.

(c) C andidates W ho W ithdraw . An 

individual who ceases to be a candidate 

pursuant to 11 CFR 9004.8 shall file a 

statement of net outstanding qualified 

campaign expenses no later than 30 

calendar days after he or she ceases to 

be a candidate. This statement shall be 

signed by the treasurer of the 

candidate's principal campaign 

committee. The statement shall contain 

the information required under 11 CFR 

9004.9(a) (1) and (2), except that the 

amount of outstanding obligations under 

11 CFR 9004.9(a)(l)(i) and the amount of 

cash on hand, assets and receivables 

under 11 CFR 9004.9(a)(2) shall be 

complete as of the day on which the 

individual ceased to be a candidate.

(d) (1) C apital A ssets. For purposes of 

this section, the term “capital assets” 

means any property used in the 

operation of the campaign whose value 

exceeds $500 on the last day of the 

expenditure report period or the day on 

which the individual ceases to be a 

candidate, whichever is earlier. Property 

that must be valued as capital assets 

under this section includes, but is not 

limited to, office equipment, furniture, 

vehicles and fixtures acquired for use in 

the operation of the candidate’s 

campaign, but does not include property 

defined as “other assets” under 11 CFR 

9004.9(d)(2). The value of a capital asset 

shall be the fair market value on the last 

day of the expenditure report period or 

the day on which the individual ceases 

to be a candidate whichever is earlier, 

unless the item is acquired after these 

dates, in which case the item will be 

valued on the date it is acquired.

(2) O ther A ssets. The term “other 

assets” means any property acquired by 

the campaign for use in raising funds or 

as collateral for campaign loans. “Other 

assets” must be included on the 

candidate’s statement of net outstanding 

qualified campaign expenses if the 

aggregate value of such assets exceeds 

$5000. The value of “other assets” shall 

be determined by the fair market value 

of each item on the last day of the 

expenditure report period or the day on 

which the individual ceased to be a 

candidate, whichever is earlier, unless 

the item is acquired after these dates, in 

which case the item shall be valued on 

the date it is acquired.

(e) R eview o f C andidate Statem ent.—

(1) G eneral. The Commission will 

review the statement filed by each 

candidate under this section. The 

Commission may request further

information with respect to statements 

filed pursuant to 11 CFR 9004.9(b) during 

the audit of that candidate’s authorized 

committee(s) under 11 CFR-Part 9007.

(2) C andidate E ligible fo r PostE lection Funding, (i) If, in reviewing the 

preliminary statement of a candidate 

eligible to receive post-election funding, 

the Commission receives information 

indicating that substantial assets of that 

candidate’s authorized committee(s) 

have been undervalued or not included 

in the statement or that the amount of 

outstanding qualified campaign 

expenses have been otherwise 

overstated in relation to campaign 

assets, the Commission may decide to 

temporarily postpone its certification of 

funds to that candidate pending a final 

determination of whether the candidate 

is entitled to all or a portion of the funds 

for which he or she is eligible based on 

the percentage of votes the candidate 

received in the general election.

(ii) In itial D eterm ination. In making a 

determination under 11 CFR 

9004.9(e)(2)(i), the Commission will 

notify the candidate within 10 business 

days after its receipt of the statement of 

its initial determination that the 

candidate is not entitled to receive the 

full amount for which the candidate may 

be eligible. The notice will give the legal 

and factual reasons for the initial 

determination and advise the candidate 

of the evidence on which the 

Commission’s initial determination is 

based. The candidate will be given the 

opportunity to revise the statement or to 

submit, within 10 business days, written 

legal or factual materials to demonstrate 

that the candidate has net outstanding 

qualified campaign expenses that entitle 

the candidate to post-election funds. 

Such materials may be submitted by 

counsel if the candidate so desires.

(iii) F in al D eterm ination. The 

Commission will consider any written 

legal or factual materials submitted by 

the candidate before making its final 

determination. A final determination 

that the candidate is entitled to receive 

only only a portion or no post-election 

funding will be accompanied by a 

written statement of reasons for the 

Commission’s action. This statement 

will explain the legal and factual 

reasons underlying the Commission’s 

determination and will summarize the 

rusults of any investigation on which the 

determination is based.

(iv) If the candidate demonstrates that 

the amount of outstanding quàlified 

campaign expenses still exceeds 

campaign assets, the Commission will 

certify the payment of post-election 

funds to which the candidate is entitled.

§ 9004.10 Sale of assets acquired for

fundraising purposes.

(a) G eneral. A minor or new party 

candidate may sell assets donated to the 

campaign or otherwise acquired for 

fundraising purposes subject to the 

limitations and prohibitions of 11 CFR

9003.2, Title 2, United States Code, and 

11 CFR Parts 110 and 114. This section 

will only apply to major party 

candidates to the extent that they sell 

assets acquired either for fundraising 

purposes in connection with his or her 

legal and accounting compliance fund or 

when it is necessary to make up any 

deficiency in payments received from 

the Fund due to the application of 11 

CFR 9005.2(b).

(b) S ale A fter End o f Expenditure

R eport P eriod. A minor or new party 

candidate, or a major party candidate in 

tlie event of a deficiency in the 

payments received from the Fund due to 

the application of 11 CFR 9005.2(b), 

whose outstanding debts exceed the 

cash on hand after the end of the 

expenditure report period as determined 

under 11 CFR 9002.12, may dispose of 

assets acquired for fundraising purposes 

in a sale to a wholesaler or other 

intermediary who will in tum sell such 

assets to the public provided that the 

sale to the wholesaler or intermediary is 

an arms-length transaction. Sales made 

under this subsection will not be subject 

to the limitations and prohibitions of 

Title 2, United States Code and 11 CFR 

Parts 110 and 114.

PART 9005—CERTIFICATION BY

COMMISSION

Sec.

9005.1 Certification of payments for 

candidates.

9005.2 Payments to eligible candidates from 

the fund.

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

9005.1 Certification of payments for

candidates.

(a) C ertification o f Paym ents fo r

M ajor Party C andidates. Not later than

10 days after the Commission 

determines that the Presidential and 

Vice Presidential candidates of a major 

party have met all applicable conditions 

for eligibility to receive payments under

11 CFR 9003.1 and 9003.2, the 

Commission shall certify to the 

Secretary that payment in full of the 

amounts to which such candidates are 

entitled under 11 CFR Part 9004 should 

be made pursuant to 11 CFR 9005.2.

(b) C ertification o f P re-election

Paym ents fo r M inor an d N ew Party

C andidates. (1) Not later 10 days after a 

minor or new party candidate has met 

all applicable conditions for eligibility to
Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations 31835

receive payments under 11 CFR 9003.1, 

9003.2 and 9004.2, the Commission will 

make an initial determination of the 

amount, if any, to which the candidate is 

entitled. The Commission will base its 

determination on the percentage of 

votes received in the official vote count 

certified in each State. In notifying the 

candidate, the Commission will give the 

legal and factual reasons for its 

determination and advise the candidate 

of the evidence on which the 

determination is based.

(2) The candidate may submit, within 

15 days after the Commission’s initial 

determination, written legal or factual 

materials to demonstrate that a 

redetermination is appropriate. Such 

materials may be submitted by counsel 

if the candidate so desires.

(3) The Commission will consider any 

written legal or factual materials timely 

submitted by the candidate in making its 

final determination. A final 

determination of certification by the 

Commission will be accompanied by a 

written statement of reasons for the 

Commission’s action. This statement 

will explain the reasons underlying the 

Commission’s determination and will 

summarize the results of any 

investigation on which the 

determination is based.

(c) Certification of Minor and New

Party Candidates for Post-election

Payments. (1) Not later than 30 days 

after the general election, the 

Commission will determine whether a 

minor or new party candidate is eligible 

for post-election payments.

(2) The Commission’s determination 

of eligibility will be based on the 

following factors:

(i) The candidate has received at least 

5% or more of the total popular vote 

based on unofficial vote results in each 

State;

(ii) The candidate has filed a

preliminary statement of his or her net 

outstanding qualified campaign 

expenses pursuant to 11 CFR 9004.9(a); 

and .

(iii) The candidate has met all 

applicable conditions for eligibility 

under 11 CFR 9003.1 and 9003.2.

(3) The Commission will notify the 

candidate of its initial determination of 

the amount, if any, to which the 

candidate is entitled, give the legal and 

factual reasons for its determination and 

advise the candidate of the evidence on 

which the determination is based. The 

Commission will also notify the 

candidate that it will deduct a 

percentage of the amount to which the 

candidate is entitled based on the 

unofficial vote results when the 

Commission certifies an amount for 

payment to the Secretary. This

deduction will be based on the average 

percentage differential between the 

unofficial and official vote results for all 

candidates who received public funds in 

the preceding Presidential general 

election.

(4) The candidate may submit within 

15 days after the Commission’s initial 

determination written legal or factual 

materials to demonstrate that a 

redetermination is appropriate. Such 

materials may be submitted by counsel 

if the candidate so desires.

(5) The Commission will consider any 

written legal or factual materials timely 

submitted by the candidate in making its 

final determination. A final 

determination of certification by the 

Commission will be accompanied by a 

written statement of reasons for the 

Commission’s action. This statement 

will explain the reasons underlying the 

Commission’s determination and will 

summarize the results of any 

investigation on which the 

determination is based.

(d) All certifications made by the 

Commission pursuant to this section 

shall be final and conclusive, except to 

the extent that they are subject to 

examination and audit by the 

Commission under 11 CFR Part 9007 and 

judicial review under 26 U.S.C. 9011.

§ 9005.2 Payments to eligible candidates

from the fund.

(a) Upon a receipt of a certification 

from the Commission under 11 CFR 

9005.1 for payment to the eligible 

Presidential and Vice Presidential 

candidates of a political party, the 

Secretary shall pay to such candidates 

out of the Fund the amount certified by 

the Commission. Amounts paid to a 

candidate shall be under the control of 

that candidate.

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

from the Commission under 11 CFR 

9005.1, the Secretary determines that the 

monies in the Fund are not, or may not 

be, sufficient to satisfy the full 

entitlements of the eligible candidates of 

all political parties, he or she shall 

withhold an amount which is 

determined to be necessary to assure 

that the eligible candidates of each 

political party will receive their pro rata 

share.

(2) Amounts withheld under 11 CFR 

9005.2(b) (1) shall be paid when the 

Secretary detemines that there are 

sufficient monies in the Fund to pay 

such amounts, or pro rata portions 

thereof, to all eligible candidates from 

whom amounts have been withheld.

(c) Payments received from the Fund 

by a major party candidate shall be 

deposited in a separate account 

maintained by his or her authorized

committee, unless there is a deficiency 

in the Fund as provided under 11 CFR 

9005.2(b)(1). In the case of a deficiency, 

the candidate may establish a separate 

account for payments from the Fund or 

may deposit such payments with 

contributions received pursuant to 11 

CFR 9003.3(b). The account(s) shall be 

maintained at a State bank, federally 

chartered depository institution or other 

depository institution, the deposits or 

accounts of which are insured by the 

Federal Deposit Insurance Corporation 

or the Federal Savings and Loan 

Insurance Corporation.

(d) No funds other than the payments 

received from the Treasury, 

reimbursements, or income generated 

through use of public funds in 

accordance with 11 CFR 9004.5, shall be 

deposited in the account described in 11 

CFR 9005.2(c). “Reimbursements" shall 

include, but are not limted to, refunds of 

deposits, vendor refunds, 

reimbursements for travel expenses 

under 11 CFR 9004.6 and 9004.7 and 

reimbursements for legal and accounting 

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

PART 9006—REPORTS AND

RECORDKEEPING

Sec.

9006.1 Separate reports.

9006.2 Filing dates.

Authority: 26 U.S.C. 9006, 9009.

§ 9006.1 Separate reports.

(a) The authorized committee(s) of a 

candidate shall report all expenditures 

to further the candidate’s general 

election campaign in reports separate 

from reports of any other expenditures 

made by such committee(s) with respect 

to other elections. Such reports shall be 

filed pursuant to the requirements of 11 

CFR Part 104.

(b) The authorized committee(s) of a 

candidate shall file separate reports as 

follows:

(1) One report shall be filed which 

lists all receipts and disbursements of:

(1) Contributions and loans received 

by a major party candidate pursuant to 

'l l CFR Part 9003 to make up 

deficiencies in Fund payments due to 

the application of 11 CFR Part 9005;

(ii) Contributions and loans received 

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

minor, or new party for use in the 

general election;

(iii) Receipts for expenses incurred 

before the beginning of the expenditure 

report period pursuant to 11 CFR 9003.4;

(iv) Personal funds expended in 

accordance with 11 CFR 9003.2(c); and

(v) Payments received from the Fund.

(2) A second report shall be filed 

which lists all receipts of and
31836 Federal Register / Vol. 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations

disbursements from, contributions 

received for the candidate’s legal and 

accounting compliance fund in 

accordance with 11 CFR 9003.3(a).

§ 9006.2 Filing dates.

The reports required to be filed under 

11 CFR 9006.1 shall be filed during an 

election year on a monthly or quarterly 

basis as prescribed at 11 CFR 

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

the candidate’s principal campaign 

committee may elect to file reports 

either on a monthly or quarterly basis in 

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

PART 9007—EXAMINATION AND

AUDITS; PAYMENTS

Sec.

9007.1 Audits.

9007.2 Repayments.

9007.3 Extensions of time.

9007.4 Additional audits.

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

§ 9007.1 Audits.

(a) General. (1) After each 

Presidential election, the Commission 

will conduct a thorough examination 

and audit of the receipts, disbursements, 

debts and obligations of each candidate, 

his or her authorized committee(s), and 

agents of such candidates or 

committees. Such examination and audit 

will include, but will not be limited to, 

expenditures pursuant to 11 CFR 9003.4 

prior to the beginning of the expenditure 

report period, contributions to and 

expenditures made from the legal and 

accounting compliance fund established 

under 11 CFR 9003.3(a), contributions 

received to supplement any payments 

received from the Fund, and qualified 

campaign expenses.

(2) In addition, the Commission may 

conduct other examinations and audits 

from time to time as it deems necessary 

to carry out the provisions of this 

subchapter.

(3) Information obtained pursuant to 

any audit and examination conducted 

under 11 CFR 9007.1(a) (1) and (2) may 

be used by the Commission as the basis, 

or partial basis, for its repayment 

determinations under 11 CFR 9007.2.

(b) Conduct of Fieldwork. (1) The 

Commission will give the candidate’s 

authorized committee at least two 

weeks’ notice of the Commission’s 

intention to commence fieldwork on the 

audit and examination. The fieldwork 

will be conducted at a site provided by 

the committee.

(i) Office Space and Records. On the 

date scheduled for the commencement 

of fieldwork, the candidate or his or her 

authorized committee(s) shall provide 

Commission staff with office space and 

committee records in accordance with

the candidate and committee agreement 

under 11 CFR 9003.1(b)(6).

(ii) Availability of Committee

Personnel. On the date scheduled for the 

commencement of fieldwork, the 

candidate or his or her authorized 

committee(s) shall have committee 

personnel present at the site of the 

fieldwork. Such personnel shall be 

familiar with the committee’s records 

and operation and shall be available to 

Commission staff to answer questions 

and to aid in locating records.

(iii) Failure to Provide Staff, Records

or Office Space. If the candidate or his 

or her authorized committee(s) fail to 

provide adequate office space, 

personnel or committee records, the 

Commission may seek judicial 

intervention under 2 U.S.C. 437d or 26 

U.S.C. 9010(c) to enforce the candidate 

and committee agreement made under 

11 CFR 9003.1(b). Before seeking judicial 

intervention, the Commission will notify 

the candidate of his or her failure to 

comply with the agreement and will 

recommend corrective action to bring 

the candidate into compliance. Upon 

receipt of the Commission’s notification, 

the candidate will have ten (10) 

calendar days in which to take the 

corrective action indicated or to 

otherwise demonstrate to the 

Commission in waiting that he or she is 

complying with the candidate and 

committee agreements.

(iv) If, in the course of the audit 

process, a dispute arises over the 

documentation sought or other 

requirements of the candidate 

agreement, the candidate may seek 

review by the Commission of the issues 

raised. To seek review, the candidate 

shall submit a written statement within 

10 days after the disputed Commission 

staff request is made, describing the 

dispute and indicating the candidate’s 

proposed alternative(s).

(2) Fieldwork will include the 

following steps designed to keep the 

candidate and committee informed as to 

the progress of the audit and to expedite 

the process:

(i) Entrance Conference. At the outset 

of the fieldwork,. Commission staff will 

hold an entrance conference, at which 

the candidate’s representatives will be 

advised of the purposse of the audit and 

the general procedures to be followed. 

Future requirements of the candidate 

and his or her authorized committee, 

such as possible repayments to the 

United States Treasury, will also be 

discussed. Committee representatives 

shall provide information and records 

necessary to conduct the audit, and 

Commission staff will be available to 

answer committee questions.

(ii) Review of Records. During the 

fieldwork, Commission staff will review 

committee records and may conduct 

interviews of committee personnel. 

Commission staff will be available to 

explain aspects of. the audit and 

examination as it progresses. Additional 

meetings between Commission staff and 

committee personnel may be held from 

time to time during the fieldwork to 

discuss possible audit findings and to 

resolve issues arising during the course 

of the audit.

(iii) Exit Conference. At the 

conclusion of the fieldwork, Commission 

staff will hold an exit conference to 

discuss with committee representatives 

the staffs preliminary findings and 

recommendations which the 

Commission staff anticipates that it may 

present to the Commission for approval. 

Commission staff will advise committee 

representatives at this conference of the 

projected timetable regarding the 

issuance of an audit report, the 

committee’s opportunity to respond 

thereto, and the Commission’s initial 

and final repayment determinations 

under 11 CFR 9007.2.

(3) Commission staff may conduct 

additional fieldwork after the 

completion of the fieldwork conducted 

pursuant to 11 CFR 9007.1(b) (1) and (2). 

Factors that may necessitate such 

follow-up fieldwork include, but are not 

limited to, the following:

(i) Commmittee response to audit 

findings;

(ii) Financial activity of the 

commmittee subsequent to the fieldwork 

conducted pursuant to 11 CFR 

9007.1(b)(1);

(iii) Committee responses to 

Commission repayment determinations 

made under 11 CFR 9007.2.

(4) The Commission will notify the 

candidate and his or her authorized 

committee if follow-up fieldwork is 

necessary. The provisions of 11 CFR 

9007.1(b) (1) and (2) will apply to any 

additional fieldwork conducted.

(c) Preparation of Interim Audit

Report. (1) After the completion of the 

fieldwork conducted pursuant to 11 CFR 

9007.1(b)(1), the Commission will issue 

an interim audit report to the candidate 

and his or her authorized committee. 

The interim audit report may contain 

Commission findings and 

recommendations regarding one or more 

of the following areas:

(i) An evaluation of procedures and 

systems employed by the candidate and 

committee to comply with applicable 

provisions of the Federal Election 

Campaign Act, Presidential Election 

Campaign Fund Act and Commission 

regulations;
Federal Register / Vol, 48, No. 133 / M onday, July 11, 1983 / Rules and Regulations 31837

(ii) Accuracy of statements and 

reports filed with the Commission by the 

candidate and committee;

(iii) Compliance of the candidate and 

committee with applicable statutory and 

regulatory provisions in those instances 

where the Commission has not 

instituted any enforcement action on the 

matter(s) under the provisions of 2 

U.S.C. 437g and 11 CFR Part 111; and

(iv) Preliminary calculations regarding 

future repayments to the United States 

Treasury.

2. The candidate and his or her 

authorized committee will have an 

opportunity to submit in writing within 

30 calendar days of receipt of the 

interim report, legal and factual 

materials disputing or commenting on 

the contents of the interim report. Such 

materials may be submitted by counsel 

if the candidate so desires.

(3) The Commission will consider any 

written legal and factual materials 

submitted by the candidate or his or her 

authorized committee in accordance 

with 11 CFR 9007.1(c)(2) before 

approving and issuing an audit report to 

be released to the public. The contents 

of the publicly-released audit report may 

differ from that of the interim report 

since the Commission will consider 

timely submissions of legal and factual 

materials by the candidate or committee 

in response to the interim report.

(d) Preparation of Publicly-Released

Audit Report. An audit report prepared 

subsequent to an interim report will be 

publicly released pursuant to 11 CFR 

9007.1(e). This report will contain 

Commission findings and 

recommendations addressed in the 

interim audit report but may contain 

adjustments based on the candidate’s 

response to the interim report. In 

addition, this report will contain an 

initial repayment determination made 

by the Commission pursuant to 11 CFR 

9007.2(c)(1) in lieu of the preliminary 

calculations setjorth in the interim 

report.

(e) Public Release of Audit Report. (1) 

After the candidate and committee have 

had an opportunity to respond to a 

written interim report of the 

Commission, the Commission will make 

public the audit report prepared 

subsequent to the interim report, as 

provided in 11 CFR 9007.1(d).

(2) If the Commission determines, on 

the basis of information obtained under 

the audit and examination process, that 

certain matters warrant enforcement 

under 2 U.S.C. 437g and 11 CFR Part 111, 

those matters will not be contained in 

the publicly-released report. In such 

cases, the audit report will indicate that 

certain other matters have been referred

to the Commission’s Office of General 

Counsel.

(3) The Commission will provide the 

candidate and committee copies of the 

audit report 24 hours prior to releasing 

the report to the public.

(4) Addenda to the audit report may 

be issued from time to time as 

circumstances warrant and as 

additional information becomes 

available. Such addenda may be based 

in part on follow-up fieldwork 

conducted under 11 CFR 9007.1(b)(3) and 

will be placed on the public record.

§ 9007.2 Repayments.

(a) General. (1) A candidate who has 

received payments from the Fund under 

11 CFR Part 9005 shall pay the United 

States Treasury any amounts which the 

Commission determines to be repayable 

under this section. In making repayment 

determinations under this section, the 

Commission may utilize information 

obtained from audits and examinations 

conducted pursuant to 11 CFR 9007.1 or 

otherwise obtained by the Commission 

in carrying out its responsibilities under 

this subchapter.

(2) The Commission will notify the 

candidate of any repayment 

determinations made under this section 

as soon as possible, but not later than 3 

years after the close of the expenditure 

report period.

(3) Once the candidate receives notice 

of the Commission’s final repayment 

determination under this section, the 

candidate should give preference to the 

repayment over all other outstanding 

obligations of his or her committee, 

except for any federal taxes owed by 

the committee.

(b) Bases for Repayment. The 

Commission may determine that an 

eligible candidate of a political party 

who has received payments from the 

Fund must repay the United States 

Treasury under any of the 

circumstances described below.

(1) Payments in Excess of Candidate’s

Entitlement. If the Commission 

determines that any portion of the 

payments made to the candidate was in 

excess of the aggregate payments to 

which such candidate shall pay to the 

United States Treasury an amount equal 

to such portion.

(2) Use of Funds for Non-qualified

Campaign Expenses.

(i) If the Commission determines that 

any amount of any payment to an 

eligible candidate from the Fund or any 

contributions received by a candidate 

under 11 CFR 9003.3(b) were used for 

purposes other than those described in 

paragraphs (6) (A) through (C) of this 

section, it will notify the candidate of 

the amount so used, and such candidate

shall pay to the United States Treasury 

an amount equal to such amount.

(A) To defray qualified campaign 

expenses;

(B) To repay loans, the proceeds of 

which were used to defray qualified 

campaign expenses; and

(C) To restore funds (other than 

contributions which were received and 

expended by minor or new party 

candidates to defray qualified campaign 

expenses) which were used to defray 

qualified campaign expenses.

(ii) Examples of Commission 

repayment determinations under 11 CFR 

9007.2(b)(2) include, but are not limited 

to the following:

(A) Determinations that a candidate, a 

candidate’s authorized committee(s) or 

agent(s) have incurred expenses in 

excess of the aggregate payments to 

which an eligible major party candidate 

is entitled;

(B) Determinations that amounts spent 

by a candidate, a candidate’s authorized 

committee(s) or agent(s) from the Fund, 

or from any contributions received by a 

candidate under 11 CFR 9003.3 (b) or (c), 

were not documented in accordance 

with 11 CFR 9003.5;

(C) Determinations that any portion of 

the payments made to a candidate from 

the Fund or any contributions received 

by a candidate under 11 CFR 9003.3 (b) 

or (c) were expended in violation of 

State or Federal law; and

(D) Determinations that any portion of 

the payments made to a candidate from 

the Fund, or any contributions received 

by a candidate under 11 CFR 9003.3 (b) 

or (c) were used to defray expenses 

resultng from a violation bf State or 

Federal law, such as the payment of 

fines or penalties.

(3) Surplus. If the Commission — 

determines that a portion of payments 

from the Fund remains unspent after all 

qualified campaign expenses have been 

paid, it shall so notify the candidate, 

and such candidate shall pay the United 

States Treasury that portion of surplus 

funds.

(4) Income on Investment of Payments

from the Fund. If the Commission 

determines that a candidate received 

any income as a result of investment or 

other use of payments from the Fund 

pursuant to 11 CFR 9004.5, it shall so 

notify the candidate and such candidate 

shall pay to the United States Treasury 

an amount equal to the amount 

determined to be income, less any 

Federal, State or local taxes on such - 

income.

(5) Unlawful Acceptance of

Contributions by an Eligible Candidate

of a Major Party. If the Commission 

determines that an eligible candidate of
31838 Federal Register / Vol.

a major party, the candidate’s 

authorized committee(s) or agent(s) 

accepted contributions to defray 

qualified campaign expenses (other than 

contributions to make up deficiencies in 

payments from the Fund, or to defray 

expenses incurred for legal and 

accounting services in accordance with 

11 CFR 9003.3(a)), it shall notify the 

candidate of the amount of contributions 

so accepted, and the candidate shall pay 

to the United States Treasury an amount 

equal to such amount. f

(c) R epaym ent D eterm ination

P rocedures. The Commission repayment 

determination will be made in 

accordance with the procedures set 

forth at 11 CFR 9007.2 (c)(1) through

(c)(4).

(1) In itial D eterm ination. The 

Commission will provide the candidate 

with a written notice of its initial 

repayment determination(s). This notice 

will be included in the Commission’s 

publicly-released audit report pursuant 

to 11 CFR 9007.1(d) and will set forth the 

legal and factual reasons for such 

determination(s). Such notice will also 

advise the candidate of the evidence 

upon which any such determination is 

based. If the candidate does not dispute 

an initial repayment determination of 

the Commission within 30 calendar days 

of the candidate’s receipt of the notice, 

such initial determination will be 

considered a final .determination of the 

Commission.

(2) Subm ission o f W ritten M aterials.

If the candidate disputes the 

Commission’s initial repayment 

determination(s), he or she shall have an 

opportunity to submit in writing, within 

30 calendar days of receipt of the 

Commission’s notice, legal and factual 

materials to demonstrate that no 

repayment, or a lesser repayment, is 

required. The Commission will consider 

any written légal and factual materials 

submitted by the candidate within this 

30 day period in making its final 

repayment determination(s). Such 

materials may be submitted by counsel 

if the candidate so desires.

(3) O ral Presentation. A candidate 

who has submitted written materials 

under 11 CFR 9007.2(c)(2) may request 

that the Commission provide such 

candidate with an opportunity to 

address the Commission in open 

session. If the Commission decides by 

an affirmative vote of four (4) of its 

members to grant the candidate’s 

request, it will inform the candidate of 

the date and time set for the oral 

presentation. At the date and time set 

by the Commission, the candidate or 

candidate’s designated representative 

will be allotted an'amount of time in 

which to make an oral presentation to

48, No. 133 / M onday, July 11, 1983

the Commission based upon the legal 

and factual materials submitted under 

11 CFR 9007.2(c)(2). The candidate or 

representative will also have the 

opportunity to answer any questions 

from individual members of the 

Commission.

(4) F in al D eterm ination. In making its 

final repayment determination(s), the 

Commission will consider any 

submission made under 11 CFR 

9007.2(c)(2) and any oral presentation 

made under 11 CFR 9007.2(c)(3). A final 

determination that a candidate must 

repay a certain amount will be 

accompanied by a written statement of 

reasons for the Commission’s actions. 

This statement will explain the reasons 

underlying the Commission’s 

determination and will summarize the 

results of any investigation upon which 

the determination is based.

(d) R epaym ent P eriod. (1) Within 90 

calendar days of the candidate’s receipt 

of the notice of the Commission’s initial 

repayment determination(s) the 

candidate shall repay to the United 

States Treasury amounts which the 

Commission has determined to be 

repayable. Upon application by the 

candidate, the Commission may grant 

an extension of up to 90 calendar days 

in which to make repayment.

(2) If the candidate submits written 

materials under 11 CFR 9007.2(c)(2) 

disputing the Commission’s initial 

repayment determination(s), the time for 

repayment will be suspended until the 

Commission makes its final repayment 

determination(s). Within 20 calendar 

days of the candidate’s receipt of the 

notice of the Commission’s final 

repayment determination(s), the 

candidate shall repay to the United 

States Treasury amounts which the 

Commission has determined to be 

repayable. Upon application by the 

candidate, the Commission may grant 

an extension of up to 90 calendar days 

in which to make repayment.

(e) Com putation o f Time. The time 

periods established by this section shall 

be computed in accordance with 11 CFR 

111.2.

(f) A ddition al R epaym ents. Nothing in 

this section will prevent the Commission 

from making additional repayment 

determinations on one or more ofithe 

bases set forth at 11 CFR 9007.2(b) after 

it has made a final determination on any 

such basis. The Commission may make 

additional repayment determinations 

where there exist facts not used as the 

basis for a previous final determination. 

Any such additional repayment 

determination will be made in 

accordance with the provisions of this 

section.

Rules and Regulations

(g) N ew ly-D iscovered A ssets. If, after 

any initial or final repayment 

determination made under this section, 

a candidate or his or her authorized 

committee(s) receives or becomes aware 

of assets not previously included in any 

statement of net outstanding qualified 

campaign expenses submitted pursuant 

to 11 CFR 9004.9, the candidate or his or 

her authorized committee(s) shall 

promptly notify the Commission of such 

newly-discovered assets. Newlydiscovered assets may include refunds, 

rebates, late-arriving receivables, and 

actual receipts for capital assets in 

excess of the value specified in any 

previously-submitted statement of net 

outstanding qualified campaign 

expenses. Newly-discovered assets may 

serve as a basis for additional 

repayment determinations under 11 CFR 

9007.2(f).

(h) Lim it on Repaym ent. No 

repayment shall be required from the 

eligible candidates of a political party 

under 11 CFR 9007.2 to the extent that 

such repayment, when added to other 

repayments required from such 

candidates under 11 CFR 9007.2, 

exceeds the amount of payments 

received by such candidates under 11 

CFR 9005.3.

§9007.3 Extensions of time.

t

(a) It is the policy of the Commission 

that extensions of time under 11 CFR 

Part 9007 will not be routinely granted.

(b) Whénever a candidate has a right 

or is required to take action within a 

period of time prescribed by 11 CFR Párt 

9007 or by notice given thereunder, the 

candidate may apply in writing to the 

Commission for an extension of time in 

which to exercise such right or take such 

action. The candidate shall demonstrate 

in the application for extension that 

good cause exists for his or her request

(c) An application for extension of 

time shall be made at least 7 calendar 

days prior to the expiration of the time 

period for which the extension is sought. 

The Commission may, upon a showing 

of.good cause, grant an extension of 

time to a candidate who has applied for 

such extension in a timely manner. The 

length of time of any extension granted 

hereunder shall be decided by the 

Commission and may be less than the 

amount of time sought by the candidate 

in his or her application.

(d) If a candidate fails to seek an 

extension of time, exercise a right or 

take a required action prior to the 

expiration of a time period prescribed 

by 11 CFR Part 9007, the Commission 

may, on the candidate’s showing of 

excusable neglect:
/ M onday, July 11, 1983 / Rules and Regulations 31839

(1) Permit such candidate to exercise 

his or her right(s), or take such required 

action(s) after the expiration of the 

prescribed time period; and

(2) Take into consideration any 

information obtained in connection with 

the exercise of any such right or taking 

of any such action before making 

decisions or determinations under 11 

CFR part 9007.

§9007.4 Additional audits.

In accordance with 11 CFR 104.16(c), 

the Commission pursuant to 11 CFR

111.10, may upon affirmative vote of four 

members conduct an audit and field 

investigation of any committee in any 

case in which the Commission finds 

reason to believe that a violation of a 

statute or regulation over which the 

Commission has jurisdiction has 

occurred or is about to occur.

2. By Transferring Part 9008 to 

Subchapter E, removing the heading for 

Subchapter F, and redesignating 

Subchapter G (consisting of Parts 9031 

through 9039) as Subchapter F.

3. By adding and reserving Parts 9009 

through 9011 as follows:

PARTS 9009—9011 [Reserved]

4. By adding new Part 9012 as follows:

PART 9012—UNAUTHORIZED

EXPENDITURES AND

CONTRIBUTIONS

Sec.

9012.1 Excessive expenses.

9012.2 Unauthorized acceptance of 

contributions.

9012.3 Unlawful use of payments received 

from the fund.

9012.4 Unlawful misrepresentations and 

falsification of statements-, records or 

other evidence to the Commission; 

refusal to furnish books and records.

9012.5 Kickbacks and illegal payments.

9012.6 Unauthorized expenditures and

. contributions by political committees. 

•Authority: 26 U.S.C. 9012.

§ 9012.1 Excessive expenses.

(a) It shall be unlawful for an eligible 

candidate of a political party for 

President and Vice President in a 

Presidential election or the candidate’s 

authorized committee(s) knowingly and 

willfully to incur qualified campaign 

expenses in excess of the aggregate 

payments to which the eligible 

candidates of a major party are entitled 

under 11 CFR Part 9004 with respect to 

such election.

(b) It shall be unlawful for the 

national committee of a major or minor 

party knowingly and willfully to incur 

expenses with respect to a Presidential 

nominating convention in excess of the

expenditure limitation applicable with 

respect to such committee under 11 CFR 

Part 9008, unless the incurring of such 

expenses is authorized by the 

Commission under 11 CFR 9008.7(a)(3).

§9012.2 Unauthorized acceptance of

contributions.

(a) It shall be unlawful for an eligible 

candidate of a major party in a 

Presidential election or any of his or her 

authorized committees knowingly and 

willfully to accept any contribution to 

defray qualified campaign expenses, 

except to the extent necessary to make 

up any deficiency in payments received 

from the Fund due to the application of 

11 CFR 9005.2(b), or to defray expenses 

which w;puld be qualified campaign 

expenses but for 11 CFR 9002.11(a)(3).

(b) It shall be unlawful for an eligible 

candidate of a political party (other than 

a major party) in a Presidential election 

or any of his or her authorized 

committees knowingly and willfully to 

accept and expend or retain 

contributions to defray qualified 

campaign expenses in an amount which 

exceeds the qualified campaign 

expenses incurred in that election by 

that eligible candidate or his or her 

authorized committee(s).

§ 9012.3 Unlawful use of payments

received from the fund.

(a) It shall be unlawful for any person 

who receives any payment under 11 

CFR Part 9005, or to whom any portion 

of any payment so received is 

transferred, knowingly and willfully to 

use, or authorize the use of, such 

payment or any portion thereof for any 

purpose other than—

(1) To defray the qualified campaign 

expenses with respect to which such 

payment was made; or

(2) To repay loans the proceeds of 

which were used, or otherwise to restore 

funds (other than contributions to defray 

qualified campaign expenses which 

were received and expended) which 

were used, to defray such qualified 

campaign expenses.

(b) It shall be unlawful for the 

national committee of a major or minor 

party which receives any payment under 

11 CFR Part 9008 to use, or authorize the 

use of, such payment for any purpose 

other than a purpose, authorized by 11 

CFR 9008.6

§ 9012.4 Unlawful misrepresentations and

falsification of statements, records or other

evidence to the Commission; refusal to

furnish books and records.

It shall be unlawful for any person 

knowingly and willfully—

(a) To furnish any false, fictitious, or 

fraudulent evidence, books or 

information to the Commission under 11 

CFR Parts 9001-9008, or to include in 

any evidence, books or information so 

furnished any misrepresentation of a 

material fact, or to falsify or conceal any 

evidence, books or information relevant 

to a certification by the Commission o r , 

any examination and audit by the 

Commission under 11 CFR Parts 9001 et

seq.; or

(b) To fail to furnish to the 

Commission any records, books or 

information requested by the 

Commission for purposes of 11 CFR 

Parts 9001 et seq.

§ 9012.5 Kickbacks and illegal payments.

(a) It shall be unlawful for any person 

knowingly and willfully to give or 

accept any kickback or any illegal 

payment in connection with any 

qualified campaign expenses of any 

eligible candidate or his or her 

authorized committee(s).

(b) It shall be unlawful for the 

national committee of a major or minor 

party knowingly and willfully to give or 

accept any kickback or any illegal 

payment in connection with any 

expense incurred by such committee 

with respect to a Presidential 

nominating convention.

§ 9012.6 Unauthorized expenditures and

contributions by political committees.

(a) It is unlawful for any political 

committee which is not an authorized 

committee of any eligible candidate of a 

political party for the Office of President 

or Vice President, knowingly and 

willfully to incur expenditures to further 

the election of such candidates which 

aggregate in excess of $1,000 and which 

would constitute qualified campaign 

expenditures if incurred by the 

candidate’s authorized committee.

(b) The unauthorized expenditures 

and contributions referred to in 11 CFR 

9012.6(a) do not include:

(1) Expenditures by a broadcaster 

regulated by the Federal 

Communications Commission, or by a 

periodical publication, in reporting the 

news or taking editorial positions; or

(2) Expenditures by any organization 

described in 26 U.S.C. 501(c) which is 

exempt from tax under 26 U.S.C. 501(a) 

in communicating to its members the 

views of that organization.

Dated: July 1,1983.

Danny L. McDonald,

Chairman, Federal Election Commission.

[FR Doc. 83-18315 Filed 7-#-83; 8:45 am]

BILLING CODE 6715-01-M