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FEDERAL ELECTION COMMISSION

1325 K STREE1' N.W.

WASHINCTON,D.C. 20463

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REPORT OF THE COMPLIANCE REVIEW SECTION

OFFICE OF DISCLOSURE AND COMPLIANCE

FEDERAL ELECTION COMMISSION

ON

THE SANFORD FOR PRESIDENT COMMITTEE

I. Background

This report covers the post-primary audit of the Sanford for President Committee, undertaken by the Compliance Review staff of the Federal Election Commission to determine

whether there has been compliance with the provisions of the

Federal Election- Campaign Act, as amended ("the Act n ). The

audit was conducted pursuant to Section 9038 of Title 26,

United States Code (26 U.S.C. 9038), which directs the Commission to conduct an audit of the qualified campaign expenses of every candidate and his authorized committees who

received matching fund payments and to determine the amount,

if any, of repayment to the matching paymentS account.

The Sanford for President Committee, formerly Citizens

committee to Nominate Terry Sanford, originally registered with u.s. General Accounting Office on June 21, 1974, to support the nomination of James Terry Sanford for the Office of

President. The principal officers of the Committee at the

time·of the audit were Mr. Hulett C. Smith, Chairman, and

Mr. Paul Allen Vick, Sr., Treasurer. The Committee maintains

its headquarters in Dqrham, North Carolina.

The audit covered the period January 1, 1975 through

June 30, 1976. During that period, the Committee reported receipts of $590,843.68 and expenditures of $603,008.48.

II. Findings and Conclusions

(a) Section 433(b)(9) of Title 2, United States Code

(2 U.S.C. 433(b)(9)] requires a political committee to disclose all banks, safety deposit boxes, or other depositories used in their Statement of Organization.

Our review disclosed that the Committee maintained

the following bank accounts which were neither disclosed on

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•• - the original Statement of Organization nor in any amendments

to this Statement:

(1)

(2)

(3)

(4)

First Union National Bank, Raleigh, North

Carolina

New England Merchants National Bank, Boston,

Massachusetts .

Bank of New Hampshire, Manchester, New Hamp- sbire .

United California Bank, Los Angeles, California

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It was our recommendation that an amended Statement of Organ- ization be filed to disclose this information. On July 30,

1976, and September 7, 1976, amended Statements of Organiza- tion were receiv~d by the Commission disclosing this information.

(b) Section 434(b) of Title 2, United States Code

[2 U.S.C. 434(b)] requires a political committee to r~port

the total sum of all receipts for the reporting period.

In several instances, Committee records showed

contributions in kind receiyed by the Committee which were

not disclosed in the reports. Although these contributions

tOtaled $889.38, no single item required itemization.

We recommended that the January 31, 1976 Report be amended to include these unitemized contributions. On

July 30, 1976, the Committee amended this Report to include

these contributions.

(c) Repayment of Receipts from the Matching Payment

Account.

(1) Section 9038(b)(2) of Title 26, United

States Code [26 D.S.C. 9038(b)(2») requires that the Commission determine the amount, if any, of any payment made

to a candidate from the matching payment account used for

any purpose other than a qualified campaign expense.

During the course of the audit all expenditure records of the Committee were reviewed. Based on this

rev!pw, no expenditures for other than qUdlified campaign

expenses were identified. •

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Total Matching Payments - $246,388.32 · Unexpended <:) Total oepos1ts - $613,18J.60 X $1~9.S6 Balance

We therefore recommend repayment of $48.04

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Present Status of the Committee - III.

(2) Section 9038(b)(3) of Title 26, United States

Code [26 U.S.C. 9038(b)(3)] requires repayment of the portion

at the unexpended balance in the candidate's accou~t which b~ars the same ratio as the total amount receiveC: ~'rom the m~tching payment account bears to the total of aj' deposits.

On July 16, 1976, the Commission notified. Mr.

Sanford of its determination that his candidacy terminated on

May 11, 1976, for purposes of making qualified campaign expen- ditures. This letter further requested a statement of the total net outstanding campaign obligations on May 11, 1976.

On July 28, 1976, the Committee Treasurer

responded to this request with a statement which disclosed

cash o~ hand, $373.631 debts owed the Committee, $2,408.861

and obligations of the Committee, $2,662.93. This results in

a cash balance of $119.56.

Upon review of this statement by the Compliance Review staff, the Committee was found to be able to substantiate that all of the Co~~ittee debts and obligations

were incurred prior to May 11, 1976.

Based on this, the Compliance Review staff .•

has comput~d the amount of repayment as follows:

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At the pre~ent time the Committee has collected all receivables and liquidated all obligations~ The Committee is

presently inactive and awaiting final notification from the

Commission so that it can make final distribution of the cash

balance and terminate the Committee.

IV. Recommendation

It is the recommendation of the Compliance Review staff

that the Commission accept the above-mentioned findings and advise the candidate of these findings (proposed letter attached) •

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FEDERAL ELECTION COMMISSION

1325 K STREET N.W.

WASHINCTON,D.C. 20463

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The Honorable Terry Sanford

1508 Pinecrest Road

Durham, North Carolina 27705

Dear Mr. Sanford:

This is in reference to the review of your principal campaign committee, The Sanford for President Committee,

conducted by our Compliance Review staff under the authority of Section 9038 ·of Title 26, enited States Code (26 D.S.C.

9038).

· ~he Commission has accepted the staff findings of

thi& review which are as follows:

(a) Section 433(b)(9) of Title 2, United States Code

[2 U.S.C. 433(b)(9») requires a political committee to disclose all banks, safety deposit boxes, or other depositories • used in their Statement of Organization.

The review disclosed that the Committee maintained

the following bank accounts which were neither disclosed in

the original Statement of Organization nor in any amendments

to this Statement:.

(1) First Union National Bank, Raleigh, North

Carolina

(2) New England Merchants National Bank, Boston,

Massachusetts

(3) Bank of New Hampshire, Manchester, New Hampshire

.

(4) United California Bank, Los Angeles, California

Based on the recom~endation of our staff, this information was included in amended Statements of Organization

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received by the Commission on July 30, 1976, and September

7, 1976.

(b) Section 434(b) of Title 2, United States Code

[2 U.S.C. 434(b)] requires a political committee to report the total sums of all receipts for the reporting period.

In several instances, Committee records showed

contributions in kind received by the Committee which were

not disclosed in the reports. Although these contributions

totaled $889.38, no single item require itemization.

Our staff recommended that the January 31, 1976

report of your Committee be amended to include these unitemized contributions. On July 30, 1976, the Commission received

an amended January 31, 1976 report containing this ,information.

(c) Section 9038(b)(2) of Title 26, United States Code

(26 U.S.C. 9038(b)(2)] requires that the Co~~ission determine

the amount, if any, of any payment made to a candidate from

the matching payment account used for any purpose other than

a qualified campaign expense.

During the course of the audit all expenditure records of the Committee were reviewed. Based on this review,

no expenditures for other than qualified campaign expenses

were identified.

(d) Section 9038(b)(3) of Title 26, United States Code

[26 U.S.C. 9038(b)(3)] requires repayment of the portion of

the unexpended balance in the candidate's account which bears

the same ratio as the total amount received from the matching

payment account bears to the total of all deposits.

On July 16, 1976, the Commission notified you of

its determination that your candidacy terminated on May 11,

1976, for purposes of making Qualified campaign expenditures. This letter further requested a statement of the total net

outstanding campaign obligations on May 11, 1976 • . On July 28, 1976, the Committee Treasurer, Mr.

Paul Vick, responded to this request with a statement which

disclosed:

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Cash on Hand

Debts owed the Committee

oqligations of the Con~ittee

Cash 'Balance

$ 373.63

2,408.86

(2,662.93l

119.56
Upon review of this statement by the Compliance Review staff, the Committee was fonnd to be able to substantiate that all of the Committee debts and obligations were

incurred prior to May 11, 1976.

Based on this, the amount of repayment is computed as follows:

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Total Matching Payments - $246,388.32

Total Deposits - $613,183.66 X

Unexpended $119.56 - Balance

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Based on this formula, you must repay $48.04

The Commission would appreciate your comments on these

findings no later than ten (10) days after receipt of this

letter. If you do not believe that the Compliance Review

staff's findings are correct, you may request a hearing pursuant to Section 134.2(b) of the Commission's proposed Regu- lations or submit additional materials without a hearing.

Please address any questions concerning the above to

carolyn Reed of our legal staff on (202)382-3153, or Joe.

Stoltz of our Compliance Review staff on (202)382-6023.

Sincerely,

Vernon W. Thomson

Chairman

Thomas E. Barris

Vice Chairman

cc: Mr. Paul Vick

Treasurer

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