Final Audit Report of the 

Commission on the Majority 

Committee PAC 

(Januaiy 1, 2011 - December 31, 2012) 

Why the Audit 

Was Done 

Federal law permits the 

Commission to conduct 

audits and field 

investigations of any 

political committee that 

is required to file reports 

under the Federal 

Election Campaign Act 

(the Act). The 

Commission generally 

conducts such audits 

when a committee 

appears not to have met 

the threshold 

requirements for 

substantial compliance 

with the Act.' The audit 

determines whether the 

committee complied with 

the limitations, 

prohibitions and 

disclosure requirements 

of the Act. 

Future Action 

The Commission may 

initiate an enforcement 

action, at a later time, 

with respect to any 

matter discussed in this 

report. 

About the Committee (p. 2) 

The Majority Committee PAC is a noncomiected, multi-candidate. 

House leadership, political action committee, headquartered in 

Bakersfield, California. The Leadership PAC Sponsor is 

Congressman Kevin McCarthy. For more information, see the 

Committee Organization, p. 2. 

Financial Activity (p. 2) 

• Receipts 

o Contribution &om Individuals 

o Contributions from Political 

Committees 

o Transfers from Affiliated 

Committees 

o Offsets to Operating 

Expenditures 

Total Receipts 

Disbunements 

o Operating Expenditures 

o Contributions to Federal 

Candidates 

o Other Disbursements 

Total Disbunements 

Commiaaion Finding (p. 3) 

Excessive Contributions to Candidates 

$ 304,150 

1,412,986 

220,572 

9,850 

$ 1,947,558 

$ 792,934 

1,291,922 

10,833 

$2,095,689 

' 52 U.S.C. §30111(b). 
Final Audit Report of the 

Commission on the 

Majority Committee PAC 

(January 1, 2011 - December 31, 2012) 
Table of Contents 

Page 

Part I. Background 

Authority for Audit 1 

Scope of Audit 1 

Part II. Overview of Committee 

Conunittee Organization 2 

Overview of Financial Activity 2 

Part III. Summary 

Commission Finding 3 

Part IV. Commission Finding 

Excessive Contributions to Candidates 4 
Parti 

Background 

Authority for Audit 

This report is based on an audit of the Majority .Committee PAC (MCP), undertaken by 

the Audit Division of the Federal Election Commission (the Conunission) in accordance 

with the Federal Election Campaign Act of 1971, as amended (the Act). The Audit 

Division conducted the audit pursuant to 52 U.S.C. §30111(b), which permits the 

Commission to conduct audits and field investigations of any political committee that is 

required to file a report under 52 U.S.C. §30104. Prior to conducting any audit under this 

subsection, the Commission must perform an internal review of reports filed by selected 

committees to determine if the reports filed by a particular committee meet the threshold 

requirments for substantial compliance with the Act. 52 U.S.C. §30111(b). 

Scope of Audit 

Following Commission-approved procedures, the Audit staff evaluated various risk 

factors and as a result, this audit examined: 

1. the consistency between reported figures and bank records; 

2. the disclosures of individud contributor's occupation and name of employer; 

3. the disclosure of contributions to other political committees; 

4. travel related expenses; and 

5. other committee operations necessary to the review. 
Part II 

Overview of Committee 

Committee Organization 

Important Dates 

• Date of Registration August 24,2006 

• Audit Coverage January 1,2011 - December 31,2012 

Headquarters Bakersfield, CA 

Bank Information 

• Bank Depositories Two 

a Bank Accounts Two Federal 

Treasurer 

e Treasurer When Audit Was Conducted Jill Thomson 

• Treasurer During Period Covered by Audit Conni Brunni: 8/24/06 - 10/18/12 

Jill Thomson: 10/19/12 - Present 

Management Information 

• Attended Commission Campaign Finance 

Seminar 

Yes 

e Who Handled Accounting and 

Recordkeeping Tasks 

Paid Staff 

Overview of Financial Activity 

(Audited Amounts) 

Cash-6n-hand ® January 1,2011 S 205,040 

Receipts 

o Contributions finm Individuals 304,150 

o Contributions from Political Committees 1,412,986 

o Transfers from Affiliated Committees 220,572 

o Offsets to Operating Expenditures 9,850 

Total Receipts $ 1,947,558 

Disbursements 

o Operating Expenditures 792,934 

o Contributions to Federal Candidates 1,291,922 

o Other Disbursements 10,833 

Total Disbursements $2,095,689 

Casb-on-hand @ December 31,2012 S 56,909 
Part lU 

Summary 

Commission Finding 

Ecxcessive Contributions to Candidates 

MCP made direct money contributions to nine federal candidate committees that, when 

aggregated with in-kind contributions, appeared to exceed the multicandidate 

contribution limit by $20,110. The in-kind contributions consisted of airfare paid by 

MCP for the leadership PAC's Sponsor to speak or make appearances at funt^sing 

events that directly benefitted these conunittees. The excessive contributions are not 

eligible for redesignation. In response to the Interim and Draft Final Audit Report 

recommendations, MCP stated that it had contacted (or re-contacted) the nine federal 

candidate committees that received excessive contributions to request refunds. Also, 

MCP provided copies of the refund request letters sent to the Conunittees, copies of the 

refund checks, and copies of the supporting bank documentation for the refunds, which 

totaled $15,236. In addition, MCP has helped committees to revise their reports related 

to these reflmds. The Audit staff considers the $15,236 to be untimely resolved, leaving 

$4,874 unresolved. 

. The Commission approved a finding that MCP made excessive contributions to federal 

candidate conunittees in the amount of $20,110. (For more detail, see p. 4.) 
Part rV 

Commission Finding 

Finding 1. Excessive Contribntions to Candidates 

Summary 

MCP made direct money contributions to nine federal candidate committees that, when 

aggregated with in-kind contributions, appeared to exceed the multicandidate 

contribution limit by $20,110. The in-kind contributions consisted of airfare paid by 

MCP for the leadership PAC's Sponsor to speak or make appearances at fundiaising 

events that directly benefitted these committees. The excessive contributions are not 

eligible for redesignation. In response to the Interim and Draft Final Audit Report 

recommendations, MCP stated that it had contacted (or re-contacted) the nine federal 

candidate committees that received excessive contributions to request refunds. Also, 

MCP provided copies of the refund request letters sent to the Committees, copies of the 

refund checks, and copies of the supporting bank documentation for the refunds, which 

totaled $15,236. In addition, MCP has helped committees to revise their reports related 

to these refimds. The Audit staff considers the $15,236 to be untimely resolved, leaving 

$4,874 unresolved. 

The Conunission approved a finding that MCP made excessive contributions to federal 

candidate conunittees in the amount of $20,110. 

Le|^ Standard 

A. Contribution Defined. A gift, subscription, loan (except when made in accordance 

with 11 CFR §§100.82 and 100.83), advance, or deposit of money or anything of value 

made by any person for the purpose of influencing any election for Federal office is a 

contribution. 11 CFR §100.S2(a). 

B. In-Kind Contribution. The term, anything of value, includes in-kind contributions. 

The provision of services at a charge less than the usual and normal charge results in an 

in-kind contribution. The usual and normal charge for a service is the commercially 

reasonable rate that one would expect to pay at the time the services were rendered. The 

value of such a contribution would be the difference between the usual and normal charge 

for the services and the amount the political committee was billed and paid. 11 CFR 

§ 100.52(d). 

C. Contribution Limits. No multicandidate political committee shall make contributions 

to any candidate and his authorized political committees with respect to any election for 

Fede^ office which, in the aggregate, exceed $5,000. 52 U.S.C. §30116 (a)(2)(A). 

D. Definition of Multicandidate Committee. 

• A multicandidate corrunittee is a political committee (other than an authorized 

candidate conunittee) that has satisfied the following 3 requirements: 
• It has been registered under the federal election campaign law for at least 6 

months. 

• It has received contributions fix>m more than SO contributors. 

• It has made contributions to at least 5 federal candidates. (This last 

requirement does not apply to state party committees.) 52 U.S.C. 

§30116(a)(4). 

• A political committee affiliated with another political committee that has already 

qualified as a multicandidate committee automatically becomes a multicandidate 

committee by virtue of that affiliation. But it shares the contributions limits with its 

affiliated committee. 52 U.S.C. §30116(a)(5). 

E. AHocatioii of Expenses Between Candidates. Expenditures made on behalf of more 

than one clearly identified federal candidate shall be attributed to each such candidate 

according to the benefit expected to be derived. In the case of a publication or broadcast 

communication, the attribution shall be determined by the proportion of space or time 

devoted to all candidates. This method shall be used to allocate payments involving both 

clearly identified federal candidates and one or more clearly identified non-federal 

candidates. 11 CFR §106.1(a). 

Facts and Analysis 

A. Facts 

The Audit staff reviewed MCP's reported contributions to political committees, totaling 

$1,292,000, and airfare, totaling $178,000. From the review of air&re, the Audit staff 

found in-kind contributions to political committees totaled $94,000. Of this amount, 

contributions to nine federal candidate committees, totaling $20,110,^ ap^ar to be 

excessive contributions when combined with direct money contributions. The in-kind 

contributions consisted of airfare paid by MCP for the leadership PAC's Sponsor to 

speak or make appearances at fundraising events that directly benefitted these federal 

candidate committees. The excessive contributions are not eligible for redesignation. 

B. Interim Audit Report & Audit Division Recommeudatibu 

At the exit conference, the Audit staff presented a .finding for the potentially excessive 

contributions and explained that they resulted from the aggregation of direct money 

contributions and in-kind contributions related to airfare. A schedule of the potentially 

excessive contributions was provided. The Audit staff asked Counsel to provide an 

explanation and documentation for any item on the schedule for which they believed was 

incorrect. Counsel agreed and stated that they may need additional clarification for some 

of the items on the schedule. 

In response to the exit conference. Counsel provided a narrative and documentation for 

three contributions that did not result irl excessive contributions. The Audit staff 

removed these items from the schedule and they were not presented as part of the finding 

amount. 

^ The amount of airfare/in-kind contributions was allocated equally among different committees based 

upon the number of events attended by the Sponsor. 

^ The amount of direct money contributions was $6S,000. 
The Interim Audit Report recommended that MCP provide evidence showing that the 

contributions were not excessive or seek a refund of the excessive contributions and 

provide copies of the refund checks and the related depository bank statements. 

C. Committee Response to Interim Audit Report 

In response to the Interim. Audit Report recommendation, MCP stated that it had 

contacted the nine federal candidate committees that received excessive contributions to 

request refunds. Immediately following MCP's response, MCP provided copies of 

reRmd request letters sent to the nine candidate committees and provided copies of refimd 

checks and supporting bank documentation for refunds totaling $13,276. The Audit staff 

considers the $13,276 to be untimely resolved and recommended that MCP provide 

copies of the additional refund checks and outstanding bank documentation to support 

when refunds for the remaining $6,834 are deposited. 

D. Draft Final Audit Report 

The Draft Final Audit Report restated the finding from the Interim Audit Report, that 

MCP made excessive contributions to federal candidate committees totaling $20,110. 

The recommendation was also restated, and requested MCP to provide documents to 

support receipt of any additional refunds for its excessive contributions. 

E. Committee Response to Draft Final Audit Report 

In response to the Draft Final Audit Report, MCP stated it had repeated its requests for 

refunds for the outstanding amount of excessive contributions, and that it was involved in 

trying to help reflmding committees with their reports. Subsequently, documentation for 

an additional $1,960 refund was received, which brought the total untimely resolved 

excessive contribution amount to $15,236, and the unresolved excessive contribution 

amount to $4,874. 

Commission Conclusion 

On April 28,2016, the Commission considered the Audit Division Recommendation 

Memorandum in which the Audit staff recommended that the Commission adopt a 

finding that MCP made excessive contributions to federal candidate committees in the 

amount of $20,110. 

The Commission approved the Audit staffs recommendation. 
Final Audit Report of the 

Commission on the Majority 

Committee PAC 

(Januaiy 1, 2011 - December 31, 2012) 

Why the Audit 

Was Done 

Federal law permits the 

Commission to conduct 

audits and field 

investigations of any 

political committee that 

is required to file reports 

under the Federal 

Election Campaign Act 

(the Act). The 

Conunission generally 

conducts such audits 

when a committee 

appears not to have met 

the threshold 

requirements for 

substantial compliance 

with the Act.' TTie audit 

determines whether the 

committee complied with 

the limitations, 

prohibitions and 

disclosure requirements 

of the Act. 

Future Action 

The Commission may 

initiate an enforcement 

action, at a later time, 

with respect to any 

matter discussed in this 

report. 

About the Committee (p. 2) 

The Majority Cormnittee PAC is a nonconnected, multi-candidate. 

House leadership, political action committee, headquartered in 

Bakersfield, California. The Leadership PAC Sponsor is 

Congressman Kevin McCarthy. For more information, see the 

Committee Organization, p. 2. 

Financial Activity (p. 2) 

• Receipts 

o Contribution from Individuals 

o Contributions from Political 

Cornmittees 

o Transfers from Affiliated 

Corrunittees 

b Ofi^s to Operating 

Expenditures 

Total Receipts 

Disbursements 

o Operating Expenditures 

o Contributions to Federal 

Candidates 

o Other Disbursements 

Total Disbursements 

Commission Finding (p. 3) 

Excessive Contributions to Candidates 

S 304,150 

1,412,986 

220,572 

9,850 

S 1,947,558 

$ 792,934 

1,291,922 

10,833 

$ 2,095,689 

52 U.S.C. §30111(b). 
Final Audit Report of the 

Commission on the 

Majority Committee PAC 

(January 1, 2011 - December 31, 2012) 
Table of Contents 

Page 

Part I. Background 

Authority for Audit 1 

Scope of Audit 1 

Part n. Overview of Committee 

Committee Organization 2 

Overview of Financial Activity 2 

Part III. Summary 

Conunission Finding 3 

Part IV. Commission Finding 

Excessive Contributions to Candidates 4 
Parti 

Background 

Authority for Audit 

This report is based on an audit of the Majority Conunittee PAC (MCP), undertaken by 

the Audit Division of the Federal Election Commission (the Commission) in accordance 

with the Federal Election Campaign Act of 1971, as amended (the Act). The Audit 

Division conducted the audit pursuant to 52 U.S.C. §30111(b), which permits the 

Commission to conduct audits and field investigations of any political committee that is 

required to file a report under 52 U.S.C. §30104. Prior to conducting any audit under this 

subsection, the Cortunission must perform an internal review of reports filed by selected 

conunittees to determine if the reports filed by a particular corrunittee meet the threshold 

requirements for substantial compliance with the Act. 52 U.S.C. §30111(b). 

Scope of Audit 

Following Commission-approved procedures, the Audit staff evaluated various risk 

factors and as a result, this audit examined: 

1. the consistency between reported figures and bank records; 

2. the disclosures of individual contributor's occupation and name of employer, 

3. the disclosure of contributions to other political conunittees; 

4. travel related expenses; and 

5. other conunittee operations necessary to the review. 
Part II 

Overview of Committee 

Committee Organization 

Important Dates 

• Date of Registration August 24,2006 

• Audit Coverage January 1,2011 - December 31,2012 

Headquarters Bakersfield, CA 

Bank Information 

• Bank Depositories Two 

e Bank Accounts Two Federal 

Treasurer 

• Treasurer When Audit Was Conducted Jill Thomson 

• Treasurer During Period Covered by Audit Conni Brunni: 8/24/06 - 10/18/12 

Jill Thomson: 10/19/12 - Present 

Management Information 

• Attended Commissipn Campaign Finance 

Seminar 

Yes 

• Who Handled Accounting and 

Recordkeeping Tasks 

Paid Staff 

Overview of Financial Activity 

(Audited Amounts) 

Cash-on-hand ® January 1* 2011 S 205,040 

Receipts 

o Contributions finm Individuals 304,150 

o Contributions from Political Committees 1,412,986 

o Transfers from Affiliated Committees 220,572 

o Offsets to Operating Expenditures 9,850 

Total Receipts S 1,947,558 

Disbursements 

o Operating Expenditures 792,934 

o Contributions to Federal Candidates 1,291,922 

o Other Disbursements 10,833 

Total Disbursements $ 2,095,689 

Cash-on-hand @ December 31,2012 $ 56,909 
Paitm 

Summary 

Commission Finding 

Excessive Contributions to Candidates 

MCP made direct money contributions to nine federal candidate committees that, when 

aggregated with in-kind contributions, appeared to exceed the multicandidate 

contribution limit by $20,110. The in-kind contributions consisted of airfare paid by 

MCP for the leadership PAC's Sponsor to speak or make appearances at fundraising 

events that directly benefitted these committees. The excessive contributions are not. 

eligible for redesignation. In response to the Interim and Draft Final Audit Report 

recommendations, MCP stated that it had contacted (or re-contacted) the nine federal 

candidate committees that received excessive contributions to request refunds. Also, 

MCP provided copies of the refund request letters sent to the Committees, copies of the 

refund checks, and copies of the supporting bank documentation for the refunds, which 

totaled $15,236. In addition, MCP has helped committees to revise their reports related 

to these refunds. The Audit staff considers the $15,236 to be untimely resolved, leaving 

$4,874 unresolved. 

The Coimnission approved a finding that MCP made excessive contributions to federal 

candidate committees in the amount of $20,110. (For more detail, see p. 4.) 
Part rv 

Commission Finding 

Finding 1. Earoessive Contributions to Candidates 

Summary 

MCP made direct money contributions to nine federal candidate committees that, when 

aggregated with in-kind contributions, appeared to exceed the multicandidate 

contribution limit by $20,110. The in-kind contributions consisted of airfare paid by 

MCP for the leadership PAC's Sponsor to speak or make appearances at fimdraising 

events that directly benefitted these conunittees. The excessive contributions are not 

eligible for redesignation. In response to the Interim and Draft Final Audit Report 

recommendations, MCP stated that it had contacted (or re-contacted) the nine federal 

candidate committees that received excessive contributions to request refunds. Also, 

MCP provided copies of the refund request letters sent to the Committees, copies of the 

refund checks, and copies of the supporting bank documentation for the refunds, which 

totaled $15,236. In addition, MCP has helped committees to revise their reports related 

to these refimds. The Audit staff considers the $15,236 to be untimely resolved, leaving 

$4,874 unresolved. 

The Commission approved a finding that MCP made excessive contributions to federal 

candidate committees in the amount of $20,110. 

Leg»l Standard 

A. Contributioii Defined. A gift, subscription, loan (except when made in accordance 

with 11 CFR §§100.82 and 100.83), advance, or deposit of money or anything of value 

made by any person for the purpose of influencing any election for Fednal office is a 

contribution. 11 CFR § 100.52(a). 

B. In-Kind Contribution. The term, earthing of value, includes in-kind contributions. 

The provision of services at a charge less than the usual and normal charge results in an 

in-kind contribution. The usual and normal charge for a service is the commercially 

reasonable rate that one would expect to pay at the time the services were rendered. The 

value of such a contribution would be the difference between the usual and normal charge 

for the services and the amount the political committee was billed and paid. 11 CFR 

§100.52(d). 

C. Contribution Limits. No multicandidate political committee shall make contributions 

to any candidate and his authorized political committees with respect to any election for 

Federal office which, in the aggregate, exceed $5,000.52 U.S.C. §30116 (a)(2)(A). 

D. Definition of Multicandidate Committee. 

• A multicandidate committee is a political committee (other than aii authorized 

candidate committee) that has satisfied the following 3 requirements: 
• It has been registered under the federal election campaign law for at least 6 

months. 

• It has received contributions from more than SO contributors. 

• It has made contributions to at least 5 federal candidates. (This last 

requirement does not apply to state party committees.) 52 U.S.C. 

§30116(a)(4). 

• A political committee affiliated with another political committee that has already 

qualified as a multicandidate committee automatically becomes a multicandidate 

committee by virtue of that affiliation. But it shares Ae contributions limits with its 

affiliated committee. 52 U.S.C. §30116(a)(5). 

E. Allocation of Expenses Between Candidates. Expenditures made on behalf of more 

than one clearly identified federal candidate shall be attributed to each such candidate 

according to the benefit expected to he derived. In the case of a publication or broadcast 

communication, the attribution shall be determined by the proportion of space or time 

devoted to all candidates. This method shall be used to allocate payments involving both 

clearly identified federal candidates and one or more clearly identified non-federal 

candidates. 11 CFR§106.1(a). 

Facts and Analysis 

A. Facts 

The Audit staff reviewed MCP's reported contributions to political committees, totaling 

$1,292,000, and airfare, totaling $178,000. From the review of airfare, the Audit staff 

found in-kind contributions to political committees totaled $94,000. Of this amount, 

contributions to nine federal candidate committees, totaling $20,110,^ appear to be 

excessive contributions when combined with direct money contributions? The in-kind 

contributions consisted of airfare paid by MCP for the leadership PAC's Sponsor to 

speak or make appearances at fundraising events that directly benefitted these federal 

candidate committees. The excessive contributions are not eligible for redesignation. 

B. Interim Audit Report & Audit Division Recommendation 

At the exit conference, the Audit staff presented a finding for the potentially excessive 

contributions and explained that they resulted from the aggregation of direct money 

contributions and in-kind contributions related to airf^. A schedule of the potentially 

excessive contributions was provided. The Audit staff asked Counsel to provide an 

explanation and documentation for any item on the schedule for which they believed was 

incorrect. Counsel agreed and stated Aat they may need additional clarification for some 

of the items on the schedule. 

In response to the exit conference. Counsel provided a narrative and documentation for 

three contributions that did not result in excessive contributions. The Audit staff 

removed these items from the schedule and they were not presented as part of the finding 

amount. 

' The amount of airfare/in-kind contributions was allocated equally among diflerent committees based 

upon the number of events attended by the Sponsor. 

^ Tlie amount of direct money contributions was $6S,000. 
The Interim Audit Report reconunended that MCP provide evidence showing that the 

contributions were not excessive or seek a refund of the excessive contributions and 

provide copies of the refund checks and the related depository bank statements. 

C. Committee Response to Interim Audit Report 

In response to the Interim Audit Report recommendation, MCP stated that it had 

contacted the nine federal candidate committees that received excessive contributions to 

request refunds. Immediately following MCP's response, MCP provided copies of 

re^d request letters sent to the nine candidate committees and provided copies of refund 

checks and supporting bank documentation for refunds totaling $13,276. The Audit staff 

considers the $13,276 to be untimely resolved and recommended that MCP provide 

copies of the additional refund checks and outstanding bank documentation to support 

when refunds for the remaining $6,834 are deposited. 

D. Draft Final Audit Report 

The Draft Final Audit Report restated the finding from the Interim Audit Report, that 

MCP made excessive contributions to federal candidate committees totaling $20,110. 

The recommendation was also restated, and requested MCP to provide documents to 

support receipt of any additional refunds for its excessive contributions. 

E. Committee Response to Draft Final Audit Report 

In response to the Draft Final Audit Report, MCP stated it had repeated its requests for 

refunds for the outstanding amount of excessive contributions, and that it was involved in 

trying to help refunding committees with their reports. Subsequently, documentation for 

an additional $1,960 refund was received, which brought the total untimely resolved 

excessive contribution amount to $15,236, and the unresolved excessive contribution 

amount to $4,874. 

Commission Conclusion 

On April 28,2016, the Commission considered the Audit Division Recommendation 

Memorandum in which the Audit staff recommended that the Commission adopt a 

finding that MCP made excessive contributions to federal candidate committees in the 

amount of $20,110. 

The Commission approved the Audit staffs recoirunendation.