FEDERAL ELECTION COMMISSION 

WASHINGTON, D.C. 20463 

December 11, 2008 

MEMORANDUM 

To: Robert W. Biersack 

Press Officer 

\ 

From: Wanda J. Thomas'1,t-fActing Assistant Staff Director 

Audit Division 

Subject: Public Issuance of the Audit Report on Oregon Republican Party 

Attached please find a copy of the audit report on Oregon Republican Party, which 

was approved by the Commission on December 3, 2008. 

All parties involved have received informational copies of the report and the report 

may be released to the public. 

Attachment as stated 

cc:	 Office of General Counsel 

Office of Public Disclosure 

Reports Analysis Division 

FEC Library 

DSDD Website 
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. 1 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 of 

the matters discussed in 

this report. 

Report of the 

Audit Division on 

Oregon Republican Party 

January 1, 2003 - December 31, 2004 

About the Committee (p. 2)
 

Oregon Republican Party is a state party committee
 

headquartered in Salem, OR. For more information, see the chart
 

on the Committee Organization, p. 2.
 

Financial Activity (p. 2) 

• Federal Receipts 

o Contributions from Individuals $ 1,440,106 

o Contributions from Political Committees 12,193 

o Transfers from Affiliated Party Committees 1,730,048 

o Transfers from Non-federal and Levin Funds 143,834 

o Offset to Operating Expenditures 670 

o Other Federal Receipts 602 

o Total Federal Receipts $ 3,327,453 

• Federal Disbursements 

o Operating Expenditures $ 1,118,373 

o Other Federal Operating Expenditures 597,602 

o Transfers to Affiliated Committees 250,922 

o Contributions to Federal Candidates/Committees 13,434 

o Contribution Refunds 200 

o Other Disbursements 38,474 

o Federal Election Activity 1,272,276 

o Total Federal Disbursements $ 3,291,281 

• Levin Receipts $ 136,792 

• Levin Disbursements $ 135,838 

Findings and Recommendations (p. 3) 

• Disclosure of Receipts (Finding 1) 

• Disclosure of OccupationlName of Employer (Finding 2) 

• Misstatement of Levin Financial Activity (Finding 3) 

• Levin Fund: Receipt of Donations that Exceed the Limit (Finding 4) 

• Levin Fund: Disclosure of Donations (Finding 5) 

l 2 U.S.c. §438(b). 
Table of Contents 

Page 

Part I. Background 

Authority for Audit 1
 

Scope of Audit 1
 

Part II. Overview of Committee
 

Committee Organization 2
 

Overview of Financial Activity 2
 

Part III. Summaries 

Findings and Recommendations 3
 

Part IV. Findings and Recommendations
 

Finding 1. Disclosure of Receipts 4
 

Finding 2. Disclosure of Occupation/Name of Employer 5
 

Finding 3. Misstatement of Levin Financial Activity 6
 

Finding 4. Levin Fund: Receipt of Donations that Exceed the Limit 8
 

Finding 5. Levin Fund Disclosure of Donations 9
 
1 

Part I 

Background 

Authority for Audit 

This report is based on an audit of Oregon Republican Party (ORP), 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 2 V.S.c. §438(b), which permits the Commission to 

conduct audits and field investigations of any political committee that is required to file a 

report under 2 U.S.c. §434. 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 requirements 

for substantial compliance with the Act. 2 V.S.c. §438(b). 

Scope of Audit 

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

and as a result, this audit examined: 

1.	 The receipt of excessive contributions and loans. 

2.	 The receipt of contributions from prohibited sources. 

3.	 The disclosure of contributions and Levin donations received. 

4.	 The disclosure of disbursements, debts and obligations. 

5.	 The disclosure of expenses allocated between federal, non-federal and Levin 

accounts. 

6.	 The consistency between reported figures and bank records. 

7.	 The completeness of records. 

8.	 Other committee operations necessary to the review. 
2 

Part II 

Overview of Committee 

Committee Organization 

Important Dates Oregon Republican Party 

• Date of Registration March 26, 1982 

• Audit Coverage January 1,2003 - December 31,2004 

Headquarters Salem, OR 

Bank Information 

• Bank Depositories 2

• Bank Accounts 5 Federal, 3 Non-Federal, 1 Levin 

Treasurer 

• Treasurer When Audit Was Conducted Charles Oakes 

• Treasurer During Period Covered by Audit Vance Day 

Management Information 

Yes (2007) • Attended FEC Campaign Finance Seminar 

• Used Commonly Available Campaign Management Yes Software Package 

Paid Staff • Who Handled Accounting and Recordkeeping Tasks 

Overview of Financial Activity
 

(Audited Amounts)
 

Federal Cash on hand @ January 1,2003 $ 6,577 

0 Contributions from Individuals 1,440,106

0 Contributions from Other Political Committees 12,193 

0 Transfers from Affiliated Party Committees 1,730,048 

0 Transfers from Non-Federal and Levin Funds 143,834 

0 Other Receipts 1,272 

Total Federal Receipts 3,327,453 

1,118,373 

597,602 

250,922 

13,434 

38,674 

1,272,276 

$ 3,291,281 

0 Operating Expenditures 

0 Other Federal Operating Expenditures 

0 Transfers to Affiliates Committees 

0 Contributions to FederalCandidates/Committees 

0 Other Federal Disbursements 

0 Federal Election Activity 

Total Federal Disbursements 

Federal Cash on hand @ December 31, 2004 $ 42,749 

$ 56 

136,792 

135,838 

$ 1,010 

Levin Cash on hand @ January 1,2003 

Total Levin Receipts 

Total Levin Disbursements 

Levin Cash on hand @ December 31, 2004 
3 

Part III 

Summaries 

Findings and Recommendations 

Finding 1. Disclosure of Receipts 

The Audit staff reviewed contributions from individuals on a sample basis and 

determined that ORP failed to properly disclose approximately 19% of these 

contributions. The contributors' names were not disclosed correctly. The Audit staff 

recommended that ORP file amended reports correctly disclosing contributors' names on 

their Schedules A (Itemized Receipts). In response, ORP filed amended Schedules A 

which materially corrected these errors. (For more detail, see page 4) 

Finding 2.	 Disclosure of Occupation/Name of Employer 

ORP did not adequately disclose the occupation and/or name of employer for 35% of 

contributions from individuals requiring itemization on its disclosure reports. The Audit 

staff notes that the majority of the missing information was available in ORP's records. 

The Audit staff recommended that ORP file amended reports correctly disclosing the 

missing information on Schedules A (Itemized Receipts). In response, ORP filed 

amended Schedules A, lowering the error rate from 35% to 24%. Subsequent to the 

presentation of this report to the Commission, ORP filed additional amended Schedules 

A which further decreased the error rate from 24% to 11%. (For more detail, see page 5) 

Finding 3.	 Misstatement of Levin Financial Activity 

A comparison of ORP's reported Levin financial activity to Levin bank records revealed 

that in 2004, receipts and disbursements were understated by $25,542 and $51,902, 

respectively. The Audit staff recommended that ORP amend its disclosure reports to 

properly report its Levin receipts and disbursements activity. In response, ORP filed 

corrective amended reports. (For more detail, see page 6) 

Finding 4.	 Levin Fund: Receipt of Donations that 

Exceed the Limit 

The Audit staff identified three donations to the Levin fund from two donors that 

exceeded the limitation by $12,500. The Audit staff recommended that ORP refund these 

contributions and submit evidence of the refunds, or present evidence that the donations 

were not excessive. In response, ORP representatives stated that Levin funds were 

depleted, and as a result, they reported the excess Levin donations as debts owed on a 

subsequent report. (For more detail, see page 8) 

Finding 5.	 Levin Fund: Disclosure of Donations 

The Audit staff identified 12 donations reported on Schedules L-A (Levin Fund Receipts) 

totaling $67,500, which lacked or had inadequate disclosure information. The Audit staff 

recommended that ORP file amended reports correctly disclosing these donations. In 

response, ORP filed the requested amendments. (For more detail, see page 9) 
4 

Part IV
 

Findings and Recommendations
 

IFinding 1. Disclosure of Receipts 

Summary 

The Audit staff reviewed contributions from individuals on a sample basis and 

determined that ORP failed to properly disclose approximately 19% of these 

contributions. The contributors' names were not disclosed correctly. The Audit staff 

recommended that ORP file amended reports correctly disclosing contributors' names on 

their Schedules A (Itemized Receipts). In response, ORP filed amended Schedules A 

which materially corrected these errors. 

Legal Standard 

Disclosure of Receipts. For each itemized contribution, the committee must provide the 

following information: 

•	 The full name and address (including zip code) of the contributor or other source; 

•	 The name of the contributor's employer (if the contributor is an individual); 

•	 The contributor's occupation (if the contributor is an individual); 

•	 The date of receipt; 

•	 The amount; and 

•	 The aggregate year-to-date total of all receipts (within the same category) from 

the same source. 11 CFR §§100.12 and 104.3(a)(4) and 2 U.S.C. §434(b)(3)(A). 

Facts and Analysis 

The Audit staff reviewed individual contributions on a sample basis and determined that 

ORP failed to properly disclose 19% of these contributions. The errors resulted from 

ORP disclosing the contributions from the first name that appeared on a joint 

accountholder check instead of attributing them to the contributor who signed the check. 

In several instances ORP disclosed both accountholders' names from the contribution 

check as "Mr. and Mrs. " instead of the check signer's name. This practice 

could cause errors in the aggregation of contributions needed to monitor year-to-date 

balances and limitations.' 

This matter was presented to ORP representatives during the exit conference, who in tum 

stated that they would file amended Schedules A. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that ORP file amended reports to correct the disclosure 

errors discussed above. ORP amended its reports materially correcting the disclosure 

errors noted above. 

2 No presumptive reattributions pursuant to 11 CFR §110.1(k) were made relative to these contributions. 
5 

IFinding 2. Disclosure of Occupation/Name of Employer 

Summary 

ORP did not adequately disclose the occupation and/or name of employer for 35% of 

contributions from individuals requiring itemization on its disclosure reports. The Audit 

staff notes that the majority of the missing information was available in ORP's records. 

The Audit staff recommended that ORP file amended reports correctly disclosing the 

missing information on Schedules A (Itemized Receipts). In response, ORP filed 

amended Schedules A, lowering the error rate from 35% to 24%. Subsequent to the 

presentation of this report to the Commission, ORP filed additional amended Schedules 

A which further decreased the error rate from 24% to 11%. 

Legal Standard 

A. Required Information for Contributions From Individuals. For each itemized 

contribution from an individual, the committee must provide the contributor's occupation 

and the name of his or her employer. 2 U.S.c. §434(b)(3)(A) and 11 CFR §100.12. 

B. Joint Fundraising Activity. Each participating political committee must also file a
 

memo Schedule A (Itemized Receipts) itemizing its receipts as contributions from the
 

original contributors to the extent required under 11 CFR 104.3(a). 11 CFR
 

§102.17(c)(8)(i)(B).
 

C. Best Efforts Ensures Compliance. When the treasurer of a political committee
 

shows that the committee used best efforts (see below) to obtain, maintain, and submit
 

the information required by the Act, the committee's reports and records will be
 

considered in compliance with the Act. 2 U.S.c. §432(h)(2)(i).
 

D. Definition of Best Efforts. The treasurer and the committee will be considered to
 

have used "best efforts" if the committee satisfied all of the following criteria:
 

•	 All written solicitations for contributions included: 

o	 A clear request for the contributor's full name, mailing address, occupation, 

and name of employer; and 

o	 The statement that such reporting is required by Federal law. 

•	 Within 30 days after the receipt of the contribution, the treasurer made at least one 

effort to obtain the missing information, in either a written request or a 

documented oral request. 

•	 The treasurer reported any contributor information that, although not initially 

provided by the contributor, was obtained in a follow-up communication or was 

contained in the committee's records or in prior reports that the committee filed 

during the same two-year election cycle. 11 CFR §104.7(b). 

Facts and Analysis
 

The Audit staff reviewed all contributions from individuals itemized on Schedules A and
 

determined that ORP did not adequately disclose 35% of the occupation and/or name of
 

employer information. A majority of the errors were related to proceeds received from
 
6 

the 2004 Joint State committee, ajoint fundraiser in which ORP participated, and for
 

which ORP disclosed memo entries with the notation "information requested." The
 

Audit staff notes that the majority of the missing information was available in ORP's
 

records but not disclosed.
 

The Audit staff provided a schedule of the errors to ORP representatives who stated that 

they were under the impression that the missing occupation and/or name of employer 

information had been obtained by the 2004 Joint State committee and had been disclosed 

by that committee on ORP's behalf. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that ORP file amended reports correctly disclosing the 

missing information on Schedules A. In response, ORP amended its reports, disclosing 

an additional 11% of the missing occupation/name of employer. This lowered the error 

rate from 35% to 24%. Most of the remaining errors were from ORP' s 2004 Joint State 

committee proceeds and, as noted above, much of the information is in ORP's files. 

Subsequent to the presentation of this report to the Commission, ORP filed additional
 

amended Schedules A which further decreased the error rate from 24% to 11%.
 

IFinding 3. Misstatement of Levin Financial Activity 

Summary 

A comparison of ORP's reported Levin financial activity to Levin bank records revealed 

that in 2004, receipts and disbursements were understated by $25,542 and $51,902, 

respectively. The Audit staff recommended that ORP amend its disclosure reports to 

properly report its Levin receipts and disbursements activity. In response, ORP filed 

corrective amended reports. 

Legal Standard 

What to Report. A state, district or local party committee of a political party that is a 

political committee must report all receipts and disbursements made for Federal election 

activity (FEA) if the aggregate amount of such receipts and disbursements is $5,000 or 

more during the calendar year. The disclosure required must include receipts and 

disbursements of Federal funds and of Levin funds used for Federal election activity. 

Each report must disclose: 

•	 The amount of cash on hand at the beginning and end of the reporting period; 

•	 The total amount of receipts for the reporting period and for the calendar year; 

•	 The total amount of disbursements for the reporting period and for the calendar 

year; and 

•	 The total amount of transfers of Levin Funds from its Levin account to its Federal 

or allocation account. 11 CFR §300.36(b)(2). 

Facts and Analysis 

The Audit staff reconciled ORP's reported Levin financial activity to its Levin bank 

records and determined that there was an understatement of receipts, disbursements and 
7 

an overstatement of ending cash on hand. The following chart details the discrepancies 

between the disclosure reports filed by ORP and its bank records: 

12004 Levin Fund Activity 

Reported Bank Records Discrepancy 

Opening Cash Balance ° $56 ($56) 

Understated 

lReceipts $111,250 $136,792 ($25,542) 

Understated 

Disbursements $83,936 $135,838 ($51,902) 

Understated 

Ending Cash Balance $27,314 $1,010 $26,304 

Overstated 

Receipts 

The understatement of receipts was the result of the following: 

•	 Under reported transfers from RNC Transfer Account $ 3923 

•	 Under reported transfers from Victory 2004 Federal Account 25,1504 

Total understatement $25.542 

Disbursements 

The understatement of disbursements was the result of the following: 

•	 Unreported transfers to ORP Federal $19,613 

•	 Unreported transfers to ORP Non-Federal 31,0005 

•	 Unreported contributions to county committees 1,069 

•	 Unreported bank fees 220 

Total understatement $51,902 

Ending Cash on Hand 

The $26,304 overstatement of ORP's closing cash on hand was the result of the 

misstatements mentioned above. 

The Audit staff discussed this matter with ORP's representatives and presented them with 

relevant schedules. An ORP representative stated that corrective amendments would be 

filed. 

3 ORP transferred $392 from their RNC transfer account into their Levin account to reimburse the federal 

account 36% for voter registration that was paid out of the Levin account to various county GOP 

committees. This was an immaterial prohibited contribution. 

4 These individual contributions were erroneously deposited into the federal account. 

5 It appears that the QRP administrator did not "click" all the required parameters within the software that 

would have put this information on the Schedules H6 (Disbursements of Federal and Levin Funds for 

Allocated Federal Election Activity) when amendments were filed. 
8 

Interim Audit	 Report Recommendation and Committee Response 

The Audit staff recommended that ORP amend its Schedules L (Aggregation Page: Levin 

Funds), Schedules L-A (Itemized Receipts of Levin Funds), and Schedules L-B (Itemized 

Disbursements of Levin Funds) to properly report the Levin receipts and disbursements 

activity. In response, ORP filed amended disclosure reports that materially corrected the 

misstatements of reported activity. 

Finding 4.	 Levin Fund: Receipt of Donations that 

Exceed the Limit 

Summary 

The Audit staff identified three donations to the Levin fund from two donors that 

exceeded the limitation by $12,500. The Audit staff recommended that ORP refund these 

contributions and submit evidence of the refunds, or present evidence that the donations 

were not excessive. In response, ORP representatives stated that Levin funds were 

depleted, and as a result, they reported the excess Levin donations as debts owed on a 

subsequent report. 

Legal Standard 

A. Party Committee Limits. A state, district or local committee of a political party 

must not solicit or accept from any person (including any entity established, financed, 

maintained, or controlled by such person) one or more donations of Levin Funds 

aggregating more than $10,000 in a calendar year. If the state limit is less than $10,000, 

the committee must adhere to that limit. 11 CFR §300.31 (d) (1)-(2). 

Facts and Analysis 

The Audit staff identified three donations to the Levin fund from two donors that 

exceeded the limitation by $12,500. Oregon state law allows unlimited donations from 

corporations; therefore the federal limit for the Levin donations of $10,000 per donor in a 

calendar year should have been followed. These excessive contributions consisted of one 

$20,000 contribution from a corporation made on March 12,2004 that exceeded the 

donation limit by $10,000. Two donations were made by a lumber company that 

exceeded the donation limit by $2,500. The company made a $10,000 donation on 

February 10, 2004 and a $2,500 donation on July 28, 2004. . 

This matter was presented to ORP representatives who offered no comment. 

Interim Audit Report Recommendation and Committee Reponses 

The Audit staff recommended that ORP refund the $12,500 and provide evidence of such 

refunds (copies of the front and back of the cancelled checks). ORP representatives 

stated that Levin funds were depleted. As a result, they reported the $12,500 excess 

Levin donations as debts owed on the November 2007 monthly report. 
9 

IFinding 5. Levin Fund Disclosure of Donations 

Summary 

The Audit staff identified 12 donations reported on Schedules L-A (Levin Fund Receipts) 

totaling $67,500, which lacked or had inadequate disclosure information. The Audit staff 

recommended that ORP file amended reports correctly disclosing these donations. In 

response, ORP filed the requested amendments. 

Legal Standard 

Disclosure of Receipts. For each itemized contribution, the committee must provide the 

following information: 

•	 The contributor's full name and address (including zip code); 

•	 The contributor's occupation and the name of his or her employer; 

•	 The date of receipt (the date the committee received the contribution); 

•	 The amount of the contribution; and 

•	 The calendar year-to-date total of all contributions from the same individual. 11 

CFR §§100.12 and 104.3(a)(4) and 2 U.S.c. §434(b)(3)(A). 

Facts and Analysis 

The Audit staff identified 12 donations reported on Schedules L-A totaling $67,500 

which lacked or had inadequate disclosure information. ORP used the contributor card 

information and attributed corporate donations to the individuals whose names appeared 

on the donor card or check. This accounted for most of these errors and could result in 

excessive receipts (combining corporate receipt limits with personal limits). For the 

Levin account, corporate receipts are permitted (subject to state law) and the 

contributions should be disclosed as such. 

This matter was presented to ORP representatives who offered no comment. 

Interim Audit Report Recommendation and Committee Response 

The Audit staff recommended that ORP file complete amended reports, correctly 

disclosing these contributions on Schedules L-A. ORP filed amended Schedules L-A 

which materially corrected these errors.