Attachr.~nt ~s st~tnd

RDUeAl. fllCTKM COMMISSION

PRlID t:tLA'P)

PilKSS CWV1Cr.

!lOll CIlII'1'A

JU!)Y IIMna:1S

OCtOIMtr J, 1"9

\\ ,,~..'Iot ... tS'" .......

cera l'CC: Library ~ll

r'lbl i." ~aC'or.d

At t in~·,,~~,ational copies or ~ho rf'!JOrt M"" ~n

rceuiv~".l b;: ~ll parties involvc.l and t.his report. I'.ay Ix!

ro le&'ul'~ll to t!ll~ p~b1ic•

PUDLIC ISstH'\:JCC OF MJDI'l' RBPOR'!' - •..~XAS l)£itoC'WlIC GM¥ COIIrItft'D

Attacht...,l plo3se find 3 COpy of the fiul audi~ repor~

of the 'rcxag ilCrnoeratic Ot.Y:V COl'llli~~ae which vas a~l'ovec1

by t:tu Coau:\L'aion on Soptcnbcr :n, 197~.
A. OVerview

REroR'l' OF 'rilE AUDIT DIVISION

ON ....1£

TEXA.c; m·:MOCRATIC C".cl'l'V COMMIlft'BE

al.!'i .. ""tat • ,,\\' \\·'''N.'t'' ttl ....·ttel

fEDERAl UE<:llON CQ\~ISSION

Th(\ (00I:U:11 ttcl" rC'cdstcr.'d \d t.h the .·ed('r~,l Election

\'ommi::::inn on f'ctoh~r 18, 1976 iW .1 !~, .Ilt' c~ittcc of the

l)('mOC1·"t.ic Part~· of "()xa~. Thl.' (OotilMi t.tPl" lIklintainoo its h~'~lC,l(Itl"rtl~rs in '\\lstin, Tt.'X'::IS.

Thill re.'!port Is based on an audit of tile 'l'exas

De.acratic rD1'V Committee (-the ('ommi ttNl-), undonaken by

the Audit Division of the Fedoral Election c~l••lon in

accordnnco with the.'! commission's audit policy to de~oratnc

whether thl~"'" has bl"l.'n complianc... wi th the ,'rovisions of the

Fl.vlcral Jo:lccl.ion C'~~:: ;,i.m i\C't. of '·t71, as allr'ndcc1 (-tho Act-).

'rho audit Wilr; condu~t('d pUl'suant a.. S~tion 4°18(a) (8) of

Title 2 of til" Unit\.,.! Stat('H Cod.· \-:hich dir('('ts the C~lRston

to IlaJ:e from t· iml\ to tit1\.' andl tr. .md field invnstiqationn ~ith r0~p~ct 1.0 rl.'! (.·rtn .md st~t .·In....nts fil~l1 under the l)ro-

"isions nf thf' ;\ct.

'l'he aur!it covored thl' p,-d(j:l october 7, 1976, the

Commit:t:(!Po's inc('ption date, th"lIl1t ,h :'~~lrch 31, 1977, the

final (:'Nm~ago d..t(~ of th~ termi n.lt. ion report fil(!d by the

Cl"mmitt,!<.>. Durinu the period .:n1.tlled the Coaaittee reportl.-'d

.:\ ooqi:minc., c~1sh hal.lnc(~ of $ -0-, tntill rl1cciptR of $139,225.25,

total (!:-=t.(\nditurc~ of r.1J9,225.:!", .md ,1n cndin" cash bal.,ncl"

of $ -0-.

This audit r,-~! ort is llol::,·d on docum~nts and "Orkin'J r:lpcr~ !->upport in" cae:, of thf' f'h!t.U.l1 statements. 'J'hey form

part ()f tlw rl~cord uiJon \,'h i d1 t h.· c·c'ln."'llisBion baBed i tB decill!ons

en tho"· mOlt b"~rR in t~is rc'port .tnt! \\'t;r."! available to Co~issi.o~~"'rs

;md ,,~+·r"l'ri;lt.: r;t;l::~ for l'l"vi,'w.
-2-

8. !ex r~r80nnel

'fho principal officers of tho r.~itt(!Q durin., tho

(.Ierh)(1 audited ""rc Mr. a.c. I'l:agle Ill, Chair&ln, and '~r. nwaY!1f.i, Ho1man, 'froallUrt*r.

c. SSOP!

,",0 DUel it. includocl such testa aa vcrifica..tinn llf tot:t1 r",.,.rt~ receipt::, f':"xPf'nditurea and individual trallulac'inna, r(>"i,'\~ or requir'!fl :;uJJllOrting documentation, analysis of

COhwai ttoo debts and obli"atfona, and, such other audi t I)roecdur'.:t'

an .I..~~ nccoSBa..ry undr.r the circuastaDco8.

II. tor'a St.ltomcnt and oaaerl,)tlon of Plndi!911

tt in tho opinion of the Audit ataff, baaeel upon examination or the roport~ and statt'Jllents filed and the records prCgOnf"f'

that, (!Xr""t for thc.l deficil'\ncios noted below, r~pnrt. :Ina

st,'lt('m"nt:; of til.. T'"'X:-aS D£1IlOt!ratic reOTV Coaaitt.eo f ... irly I'rf":h"nt

the !in'lllcial act ivi ti.'s of tho c-omIIlit:toe for tho ..('\rind CoV(!:.·..:!..:.

hlP th-.1 imclit. ."Ut·th~r, axe." •• a .. noted below, no ....torlal l)r,-=,hl.-.

in compli"inq with U:a F"'d,,r.. l ,nt:>ctioD Campai'.fn Act we..-ro dis- ~o\·ort.~d durinq til(" iludit.

:lcction 43:!(J) of 'ritlc 2 of tho United States eoc1~

r;t..tt>f;, in part, that it shall bo tht" duty of the trcmmrpr to

obtn:i n .and kenp a r'.'\~,'\ivt~d bill, statinq tho particulars, for cv~ry ('\~-:p(>ndittlrc mado by a poli.tical ccl:l.-nittoe in ~XC(~gr. of

S100 in amount, an.l for any such exponditure in a lc9st~r ;U!IOUllt.

if th~ agqrcq... tt., amC'unt of such oxp~ndlturcs to tho ..a1ftC porst\n c1u:-i n., a c,11enuar }'('~lr CXCf'l.'US $100.

In ildtlition, Section 102.9(c) (4) of Title 11 of the

COl!"': of Ft:dernl R('oulations St.ltes th..lt \\"ht"n a rcccil>tod bi 11

i:: not ilV:li 1.1ble, the t.r.p<luure-r milY k,,"cp the cancelled cht"..:ok

:::if)·.d nc; !'.:lymont of til(' hi 11 r an.l the bi 11, :i.nvoicc or othol-

,'(In' "::'Ol-;mC()UR rlo·l~,,"r.l~:dltm of the> trnnnaetion suppli(.x'I to thc' t:,;:~:,iltf>.· h~' the "aye,-'.
-]-

OIlr roview of the (:,..lttoo'll oxptmdl taro reacwda

disc!'l::f"l! t Ik· followingl

Cl) One bandrAi r.Jqbty-four opcr<lwi expenditures.

(>:u::h in .-:an '-'99regate "**,,t or valvo In eXC088 of '1'00. tntatlnc:J $5S,~~1.12 ~~re not suptX)rtod ~I rnr.olptt~ bttl~, lnYOl~·n. or

other conbotllMlrancoull ."",nrLtI.d,l. 'Phollc unnUlJf'n'"hd ...UturoR

.-.;;>r,"s...nt ·)'i.l"~ of thl' h-t...l numl~r and t)1.r-.;!' of tile ",I._I (hll~,r value of ~ratln,. t'XfM'IlIUt.urcll rl",~••irh,(. RaJ'porth"" (Iuc!u,,"~ntatlon.

ftasoo on tlu' At.eli .. ftt"ff's rt't'or.l!k'ndatlon .~

C'o::u:1i ltce "I"'lttcd on OCtob'r lA, 1978, ~"fI'IOr1:1ft9 doc:na.... t.lt!.In for 87!6 or 161 oporatinl ' ~:<PN"U tU."..R totallft9 '34.JM.15

.':1,1 .'vlden(."O of tholr l1fforts to ',bt:.ln do.~ntatl.. for t2~

q" .~~! cx!>enditurcs total!"'J Slft,4'Ut."6. Thfs represents"

t"0t;11 of J81 or 99~, of the 184 oJ•• ~r••tlnq l,xpcndltareaa orb,t_lty t:::.!,:,·'r.:u:nl('Ct.

(~) '"hi ,·t'/-~ix tram;ft':-n tot.:tU nt' t:15.919.66 ~.:"l.-i.) r.:.•d~ lu 20 UtH'",:lstcn.'t1 ort,:ud;~.lti:'Ut1 t,n ('nilblo t'- t.e z"'::,~t:ct· C1,~t.-tl1lt-th_'-'..otc ar.th·itj,,:;. 'j'hc Cf-.cr.mitt o did not

,.H:.lin ,'1:1d k,·,~t> r(·r-.·ipt\....d hill:.;, i""ofe,,'S, nr oth r a"nt.C!II- !Jt' t" :t!~•.'f)US m''It'I(,raml., mtppoL·t i 111-' t1." t'xpcndi tur..~R madQ froa

ti" ,i:~:::·t·rr..~1 rttn~~.

n:l~pt.l fin tho ,\utli l :;t .If.f's rccommonclation, the:- ('::~,=:-,1 ~'t~(' nuhmlU ....l! ('In I,..tqust 2 •• :.,1 1(" 1979 suppnrtln,. doeuMt"nt:t~I~,:~ for 5~':. or 21 tr~m3f\.~rB to "i.,ht (8) unTl'(,lflt"'Too

ot<,t.mi;:':ltlonn tot..llln(l $2(,,119.(,(. ·lIlti cvld..nce of tb"ir offo.'hl

to oht;}j,n dn(!U!ftcnt;.tion f...,r 42' ("'I' I'. trannft:!Ts to 12 un- r~'J i fth~!"c'd nrqani ~;Itions total! nu :~'), (,00.

_.

~.-.__(",': :::~:.._'. n,~:, ..---- t i on

r..'uh·d ('In tho cffortn ('utt in.':1 nht'lw', tho ,'udit Rtaff

r/:e,...::~~~'n~l~ n" furth..'r .:,..ot im~ nn t~li:; In.ltt~r.

!'. ol;b"r r·tl tt . 'r~ ---..----

'&'11.., foll()\d~q i~ :t m:ttl"r lIcol,~c1 durinq th.- ~audlt f,'t'

\\.:.:;.•;~ ~.\...... r\",!('nl~.'11 ..1 no fUl·th(~l· ;t~~-.. j~'lnl
-4-

'l'hc '!'C'Xitn Dl"'llWlCratle Votar R,..,Jstratloa (!~lttee taa4c. "."I:;'.-r:-t t.otallft" $1,2110.00 t.o two (2) ,..otmt.\· CC'IIIIlttres 011

II.-h••• , nf thn TCX.Ul Ilt-.)(!I'~..tic: 00'rV C~lttt't' (-t.1Ie Cc'*altt.~-'.•

'i1,,- •••...1th-o lIubn "...-ntty rf,ll1borllCCl the' "oh-r ~Istr...tllJft

t.'.._i t t.ee for the IUDtR nl" the transfpra. "'b,' C~llt~

,lir,(!ln:-too t.h.~ two (2) • r:mf~f.~rll t:o the "wn (:') ,,-~ty c~..itto.,r.

in i t.:l dlsclomarl' r""0rt·:: hilt did _t r~, ...rt th" "'C'fllburnt!lleftt

to tt,.- Vot,,-..., 1~t.."tJ:l' r.lt i .... (·"I!lInittee. 'MIn Vnb'f' P.,"'hlt:.·••t ion

Colt,,,i t h"t~ n.-ith,~r r ....'K'r.. ·d the hlO (2) t r.mnf.'rR tC' tht.· (,~)\lnty

c..·Ulltl:1 i t h~f1 nm4the' maJ.d.",'''·1l1: reb'burs""......,· r"l.·l'\iv(~d fr,..tbc Coma.. i , t.,~o.

I\ccordi..., to .• (·orlmllt~ offiol.11, the r.ommitt~ iuskt'Cil

th..- 'I.-t.ar R~(JI8tl·atlon enrom i .. t~ to &"ltl' th~ tr3nsf~rB Oft t t..

h.'h•• lf hcc·.u~~ it. did nnt h .••••• fCurflcicnt funds at tbu tf~. \'t! ••dvised the Conaltt(ot· th'lt •• 1 Huch transf~r~/r(!imburs\')DIOnL; in tiel' futurp- t1hould be r'~J" !·t."I.