November 1997 Federal Election Commission Volume 23, Number 11

Table of Contents

Court Cases

1 FEC v. Fund for a Conservative

Majority

2 On Appeal?

Compliance

1 MUR 4235

Statistics

3 National Party Committees

Increase Soft Money

4 Advisory Opinions

5 Federal Register Notice

7 Conferences

Information

9 Faxline Menu

10 Index

Court Cases

FEC v. Fund for a

Conservative Majority

On September 23, parties to this

suit agreed to a final order and

judgment by the U.S. District Court

for the Eastern District of Virginia,

Alexandria Division. Under that

order, the defendants, Fund for a

Conservative Majority (FCM) and

its treasurer, Robert C. Heckman,

agreed to pay a civil penalty of

$2,500 for having violated the

Federal Election Campaign Act (the

Act).

Mr. Heckman failed to file the

FCM’s 1994 year-end report on

time, a violation of 2 U.S.C.

§434(a)(4)(A)(i). This section of the

Act requires political committees

other than authorized candidate

committees to file quarterly reports

during a year in which a general

election is held. The report for the

final quarter that ends on December

31 must be completed and returned

to the FEC no later than January 31

of the following year.

The FCM’s 1994 year-end report

should have been submitted to the

FEC by January 31, 1995. Mr.

Heckman hand delivered a copy of

the FCM’s year-end report on

September 7, 1995—nearly nine

months late. He also delivered

another copy of the report to staff of

(continued on page 2) (continued on page 2)

Compliance

MUR 4235

Alaska Corporations Make

Corporate Contributions and

Contributions in the Names

of Others

Two Alaska oil field construction

companies, their owner and several

others have paid a $40,000 civil

penalty to the FEC for making

impermissible corporate contributions and contributions in the names

of others during the 1992 federal

election cycle. This compliance

matter was initiated after the FEC

received a complaint from a candidate in July of 1995, following an

investigation by the Alaska Public

Offices Commission of numerous

state contributions.

In late 1991, Alaska Interstate

Construction, Inc. (AIC), made a

$1,000 contribution to the

Murkowski ’92 Committee, the

campaign committee for Senator

Frank Murkowski—who in 1992

was a candidate for that seat. Two

months later, in February 1992, the

committee returned the check to

AIC as it constituted an impermissible contribution from a corporation. 2 U.S.C. §441b(a).

Beginning in April 1992, AIC’s

owner, John Ellsworth, and office

manager, Cindy Scott, directed four

employees from the company and
Federal Election Commission RECORD November 1997

2

Court Cases

(continued from page 1)

the Commission’s Office of General

Counsel on June 27, 1996—close to

a year and a half after it was due.

See page 5 of the January 1997

Record.

Neither Mr. Heckman nor the

FCM contested the Commission’s

allegations in this case. In addition

to the civil penalty, the defendants

were permanently enjoined from

making similar violations of the Act.

U.S. District Court for the

Eastern District of Virginia, Alexandria Division, 96-1567-A. ✦

On Appeal?

FEC v. Williams

On October 3, the U.S. Solicitor

General filed a petition with the

U.S. Supreme Court asking it to

review this case. The U.S. Court of

Appeals for the Ninth Circuit had

reversed a district court decision and

had ruled in favor of the defendant,

Federal Election Commission

999 E Street, NW

Washington, DC 20463

800/424-9530

202/219-3420

202/501-3413 (FEC Faxline)

202/219-3336 (TDD for the

 hearing impaired)

800/877-8339 (FIRS)

John Warren McGarry,

Chairman

Joan D. Aikens, Vice Chairman

Lee Ann Elliott, Commissioner

Danny L. McDonald,

 Commissioner

Scott E. Thomas, Commissioner

John C. Surina, Staff Director

Lawrence M. Noble, General

 Counsel

Published by the Information

 Division

Louise D. Wides, Director

Angela Rucker, Editor

Cheryl Fowle, Associate Editor

http://www.fec.gov

Larry Williams. A request for an en

banc panel of the Ninth Circuit to

rehear this case was unsuccessful.

See the February and July 1997

Record issues.

Maine Right to Life Committee v.

FEC

On October 6, the Supreme Court

denied the Solicitor General’s

request for it to hear this case.

Nearly a year before, the U.S. Court

of Appeals for the First Circuit

upheld a lower court ruling that part

of the FEC’s regulation defining

express advocacy (11 CFR

100.22(b)) was invalid. The district

court held that the FEC’s regulation

expanded the definition beyond the

Supreme Court’s interpretation in

Buckley v. Valeo. See the April and

December 1996 Record issues. ✦

from Unicol, Inc., another company

Mr. Ellsworth owns, to make $1,000

contributions to three federal

political committees—Murkowski

’92 Committee, Alaskans for Don

Young and the Bush/Quayle Committee. Additionally, Mr. Ellsworth,

Ms. Scott and Mr. Ellsworth’s wife

made contributions to those committees. In all, these contributions

totaled $19,000.

The money for the contributions

came directly from AIC’s or

Unicol’s petty cash funds, from

“bonuses” received by the respective employees or from “draws”

from the companies. These transactions were, again, violations of the

Federal Election Campaign Act’s

(the Act’s) ban on corporate contributions, and they also violated the

ban on contributions made in the

name of another. 2 U.S.C.

§§441b(a) and 441f. The contributions all were made by certified

checks, with many of the checks

displaying the same date and

consecutive serial numbers. Although these checks were issued

using AIC’s or Unicol’s petty cash

funds, the individual’s name appeared on each check as the purchaser.

The Commission found probable

cause to believe that Mr. Ellsworth,

Ms. Scott and the two corporations

knowingly and willfully violated the

Act at §§441b(a) and 441f when

they made the $19,000 in corporate

contributions and tried to mask them

by contributing them in the names

of others.

The Commission also found

probable cause to believe that AIC,

Mr. Ellsworth and Ms. Scott violated §441b(a) with respect to the

$1,000 direct corporate contribution

in 1991 to the Murkowski Committee, and that Mrs. Ellsworth and the

four employees violated 2 U.S.C.

§441f by permitting a corporation to

use their names to make prohibited

contributions.

The Commission entered into a

conciliation agreement with the

parties to conclude the matter. In

addition, the Commission notified

the recipient committees of the

illegal contributions and instructed

them to disgorge the amounts to the

U.S. Treasury. ✦

Compliance

(continued from page 1)

Change of Address

for California Filers

 The California Secretary of

State’s Office has changed the

address where political

committees supporting federal

candidates must file copies of

their FEC reports. Reports should

now be mailed to the following

address:

Political Reform Division

Office of the Secretary of State

1500 11th St., Room 495

Sacramento, CA 95814
November 1997 Federal Election Commission RECORD

3

Statistics

National Party Committees

Increase Soft Money

Democratic and Republican

national committees collected a

combined total of more than $35

million in soft money donations

during the first half of 1997 according to mid-year disclosure reports

filed with the FEC.

The three national Republican

committees—the Republican

National Committee, National

Republican Senatorial Committee

and National Republican Congressional Committee—raised $21.7

million in soft money between

January 1 and June 30. The three

national Democratic committees—

the Democratic National Committee, Democratic Senatorial

Campaign Committee and Democratic Congressional Campaign

Committee—took in $13.7 million

in soft money during the same

period. These totals represented

increases of approximately 31

percent and 27 percent in soft

money raised by the Republicans

and Democrats, respectively, over

the soft money raised in the first six

months of 1995.

Soft money donations are

nonfederal funds raised outside the

limitations and prohibitions of the

Federal Election Campaign Act.

Such donations are to be used for

party building and get-out-the-vote

activities but not to directly influence a federal election.

Republicans continued their

preeminence over the Democrats in

raising “hard dollars” for the federal

accounts during this reporting

period. The Republican committees

raised more than $59 million while

the Democratic committees took in

$35.1 million. Republican receipts,

however, represent a 17 percent

decrease in federal receipts from the

same reporting period in 1995. The

Democrats’ tally was a 25 percent

increase in receipts over the same

reporting period in 1995. However,

when compared with the 1993-1994

election cycle—the last

nonpresidential election cycle—

Republicans registered an 18

percent increase in receipts and the

Democrats recorded a 29 percent

increase in receipts.

The majority of the contributions

to the national committees’ federal

accounts came from individuals.

Republicans reported 87 percent of

contributions from individuals,

while the Democrats showed 66

percent of contributions from

individuals. Other contributions

came from other political committees and through transfers from

national and state committees.

The mid-year reports also show

both the Democrats and Republicans

carrying multi-million dollar debts.

In this category, the Democrats led

the tally with a reported $22.6

million in unpaid obligations.

Republican committees reported

$10.7 million in debts. The Republicans had $11.4 million in cash on

hand when it filed its mid-year

report; the Democrats had $5.6

million in cash on hand for the same

period.

For more information, including

summary data for the financial

activities of the national committees, read the FEC’s September 22

news release. It is available at the

FEC’s web site (http://www.fec.gov),

from the Public Records Office (1/

800-424-9530, press 3) and on FEC

Faxline (202/501-3413, request

document 609). ✦

Sources of Contributions

to National Party

Committees – First

Quarter 1997

Soft Money Raised

During First Quarter of

Two-Year Election Cycle

Millions

Millions

$0

$5

$10

$15

$20

$25

1997

1995

1993

Republicans Democrats

$0

$10

$20

$30

$40

$50

$60

PACs

Individuals

Republicans Democrats
Federal Election Commission RECORD November 1997

4

Advisory

Opinions

AO 1997-15

Establishment of

Nonconnected PAC by CEO

of Incorporated Membership

Organization

Kenneth Nickalo, the president

and CEO of Better Government

Bureau, Inc. (BGB), an incorporated

membership organization, may

establish the Americans for Better

Government PAC (ABG PAC) as a

nonconnected PAC, separate from

BGB, provided he follows the

guidelines in this advisory opinion.

BGB attempts to resolve member

complaints regarding government

services and is made up of individuals and corporations. Mr. Nickalo

and his wife are BGB’s only employees, but BGB also has a Board

of Trustees that is responsible for

approving major policy decisions.

ABG PAC would be established

independently of BGB, with Mr.

Nickalo as the only BGB officer

serving on the PAC’s board.

Establishment of Nonconnected

PAC

The Act states that a corporation

that directly or indirectly establishes, administers or supports a

political committee is the connected

organization of that committee. 2

U.S.C. §431(7). Both the committee

and the connected organization are

subject to the Act’s restrictions on

who may be solicited for contributions to the committee. 2 U.S.C.

§§441b(b)(4)(A) and (C). However,

a political committee without a

connected organization may solicit

any individual or person who may

lawfully contribute to federal

elections. All payments to the

committee for administrative costs

are contributions subject to the

Act’s limits unless some exception

applies. The Commission does not

prescribe qualifications for those

who establish a nonconnected PAC.

Individuals who have some association with a corporation, for example,

are not necessarily prohibited from

starting such a PAC. AO 1984-12.

In permitting the formation of such

committees, the Commission seeks

to ensure that certain conditions are

met with respect to the relationship

between the PAC and the corporation.

The committee must not be

financially supported by the corporation. The Commission has concluded in the past that financial

support occurs when the corporation

provides goods or services at less

than the usual and normal charge

and/or beyond a commercially

reasonable time. 11 CFR

100.7(a)(1)(iii), and 114.9(c) and

(d). See Advisory Opinions 1995-

38, 1991-37 and 1984-12. BGB

differs from the corporations

discussed in these advisory opinions

in that it is not a commercial entity

and does not, within the ordinary

course of business, provide services

or facilities to customers.

Commission regulations allow a

corporation, in its capacity as a

commercial vendor, to extend credit

to a political committee in the

ordinary course of business and at

the usual and normal charge. 11

CFR 116.3(b) and 100.7(a)(4). Any

extension of credit outside the

corporation’s ordinary course of

business would be considered a

contribution. Since BGB does not

appear to be in the business of

providing goods or services to other

entities for the purpose of administration or fundraising assistance, it

does not qualify as a commercial

vendor that could extend credit to

the PAC for those purposes. Thus,

although ABG PAC is allowed a

commercially reasonable period of

time to pay for certain kinds of

support, it must pay for other kinds

of support in advance.

• The use of BGB’s office facilities

(meeting rooms, telephones, word

processors, copying machines)

must be paid for in a commercially

reasonable time period and at the

usual and normal charge. 11 CFR

114.9(c) and (d).

• PAC services performed by BGB

employees while they are working

on BGB time must be paid by the

PAC in advance of the services

being rendered. 11 CFR

100.7(a)(4), and 116.3(b) and (c).

• PAC use of BGB’s mailing list

must be paid for in advance. The

PAC must pay the fair market

value for the rental or purchase of

the list. 11 CFR 114.2(f)(2)(i)(C).

• The PAC must also make advance

payment for other services, such as

catering, that BGB provides to it.

11 CFR 114.2(f)(1) and (2)(E).

• ABG PAC must pay BGB in

advance for any purchases it makes

for the PAC from a third party.

Alternatively, the PAC may pay

the vendor directly. The PAC must

ensure that any charges it pays to a

third party vendor conform to the

ordinary course of business

standard. This means that any

vendors to the PAC that are also

vendors to BGB must not reference

the PAC’s business relationships

with BGB when extending credit to

or determining charges to the PAC.

If these guidelines are not

followed, BGB would be financially

supporting the PAC. That support

either would compromise the PAC’s

status as a nonconnected PAC or, if

the PAC retains its nonconnected

status, would constitute an impermissible corporate contribution from

BGB. 2 U.S.C. §§441b(a) and

441b(b)(2).

Legal and Accounting Compliance

Services

BGB may provide legal and

accounting services to ABG PAC

without charge as long as the

services are rendered by a regular

BGB employee and are provided

solely to ensure compliance with the

Act. Such services are exempt from

the definition of contribution. 2

U.S.C. §431(8)(B)(ix). BGB
November 1997 Federal Election Commission RECORD

5

proposes paying the law firm it uses

to provide legal counsel to the PAC.

Such a payment does not fall within

the exemption. The PAC should

therefore either pay the firm for the

costs or pay BGB immediately upon

billing by the law firm.1

PAC Role of Persons Associated

with BGB

The Commission also considered

the role of the persons involved in a

committee’s activities in order to

determine its status as a

nonconnected PAC. While ABG

PAC’s board will include contributors to the PAC and BGB members

might contribute to the PAC, Mr.

Nickalo will be the only person on

the PAC board who is connected

with BGB. The participation of nonBGB persons, coupled with the fact

that no BGB personnel other than

Mr. Nickalo will play a dominant

role in the PAC, is consistent with

the PAC’s nonconnected status. See

AOs 1995-38 and 1991-37.

The organizational separation is

also reflected by the fact that the

PAC will not use BGB’s name or

letterhead in soliciting contributions

and that the PAC will not hold

fundraisers in conjunction with a

BGB event.

A change in any of these factors

would require a reexamination of

ABG PAC’s status as a

nonconnected committee.

Solicitations by Nonconnected

PAC from Individual Members of

BGB

As a nonconnected PAC, ABG

PAC may solicit the general public

for contributions except for those

prohibited by the Act from contributing to federal elections.

Date: September 19, 1997;

Length: 8 pages. ✦

AO 1997-16

Transmitting Endorsements

to Restricted Class Via

Internet, Telephone and

Voice Mail

Oregon Natural Resources

Council Action (ONRC Action)

may not put its endorsements of

federal candidates on its web site;

nor is a telephone caller’s selfidentification as a member sufficient

evidence to mail that person a

printed list of ONRC Action’s

endorsements. The group also may

not record its endorsements to a

voice mail box system. All of these

actions hold the potential for

nonmembers—people who are not

in the restricted class—to receive

this communication, which would

be prohibited by the Federal Election Campaign Act (the Act) and

Commission regulations. 2 U.S.C.

§441b(b)(2)(A) and 11 CFR 114.1(j)

and 114.3(a).

ONRC Action, a 501(c)(4) taxexempt corporation organized under

Oregon law, defends natural resources from environmental destruction. Its membership consists of

approximately 5,000 individuals

who are required to pay annual

dues. ONRC Action has a board of

directors that oversees the general

management of the organization and

from which all officers of the

organization are selected. The group

is considered a membership organization under Commission regulations, and its members would be

considered members for purposes of

the Act and Commission regulations.

Currently, ONRC Action relays

its endorsements of federal candidates by mail to its restricted class—

or membership body—and by fax to

its usual media contacts. Release of

the information usually generates

more requests for information from

members and from the general

public.

ONRC Action proposes three

additional methods for making its

endorsements available:

• Putting the communication on its

web site, which is fully available

to the public;

• Providing a copy of the communication to any caller who requests

the information and states that he

or she is a member of ONRC

Action—without verifying the

statement; and

• Recording the communication on

the corporation’s voice mail box

system.

The Act contains a broad ban that

prohibits corporations from making

any contribution or expenditure in

connection with a federal election. 2

U.S.C. §441b. But there is an

exception that allows a corporation,

including an incorporated membership corporation such as ONRC

Action, to communicate with its

restricted class on any subject,

including the express advocacy of

the election or defeat of federal

candidates. Distribution of such

communications must follow these

guidelines: the material must be

produced at the expense of the

corporation, and it must constitute

the view of the corporation and not

be a mere reproduction of campaign

materials prepared by a candidate or

his or her campaign. A corporation

may, however, use brief quotations

from speeches or other candidate

materials in order to demonstrate a

candidate’s positions on issues.

Commission regulations provide

that no more than a de minimis

number of copies of any communication that contains express advocacy may be circulated beyond the

Federal Register

 Federal Register notices are

available from the FEC’s Public

Records Office.

Notice 1997-14

Recordkeeping and Reporting:

Notice of Proposed Rulemaking

(62 FR 50708, September 26,

1997)

(continued on page 6)

1

 The law firm used by BGB may,

independent of BGB, provide the PAC

with free legal and accounting services

solely for compliance with the Act,

using its regular employees, in accordance the 11 CFR 100.7(b)(14).
Federal Election Commission RECORD November 1997

6

Advisory Opinions

(continued from page 5)

restricted class. 11 CFR

114.4(c)(6).1

 A corporation may

issue a press release or hold a press

conference to announce its endorsements, or communicate the endorsement through its publications or at a

candidate appearance, but disbursements for such actions must also be

de minimis. 11 CFR 114.4(c)(6)(i).

Because access to the Internet is

widely available to the public, any

communication on its web site

would be considered a communication to the general public. See AOs

1996-16 and 1995-35. In this case,

because of this public access and the

fact that the communication would

contain express advocacy, communicating an endorsement through the

Internet would be prohibited. If,

however, ONRC Action uses a

method to limit Internet access to its

endorsements only to its members,

then its proposed action would be

permissible.2

The same analysis holds true for

the telephone requests and voice

mail box plan. When communicating over the telephone with nonmembers, a communication that

contains express advocacy, even

though it does not include a solicitation, is prohibited. On the other

hand, if ONRC Action were to

verify that the name the caller gave

was indeed on its membership list,

then it could go forward with its

plan to mail its endorsements to

those callers. Similarly, without

screening out nonmembers for the

voice mail box system, ONRC

Action cannot make its endorsement

lists available on that system.

Without the proper safeguards, any

of the three proposals could result in

prohibited corporate expenditures or

prohibited in-kind corporate contributions.

The Commission notes that

ONRC Action’s separate segregated

fund (SSF), Oregon Natural Resources Council Action Federal

PAC, could lawfully make expenditures for the organization’s three

proposals subject to the Act’s limits

and disclosure requirements. An

SSF may, using voluntary contributions, make communications to the

general public that include express

advocacy. The communication,

however, may not solicit funds for

the SSF. 11 CFR 114.5(i).

Date: September 19, 1997;

Length: 8 pages. ✦

2

 Among the methods for limiting access

are providing each member with an

identification number or password to

enter the portion of the web site that

contains the endorsements. ONRC

Action may also send a list of its

endorsements via e-mail only to its

members. The organization’s application for membership includes a request

for members’ e-mail addresses.

AO 1997-17

Contributions from Missouri

Limited Liability Company

The Nixon Campaign Fund, the

principal campaign committee of

Jay Nixon, may accept contributions

from limited liability companies

(LLCs) in Missouri subject to the

contribution limits for “person” set

out in the Federal Election Campaign Act (the Act) at section

441a(a)(1)(A).

Mr. Nixon is seeking to become

the Democratic nominee for the

1998 senatorial contest in Missouri

and anticipates receiving a contribution from an LLC in the state.

The Act uses the term person to

describe an “individual, partnership,

committee, association, corporation,

labor organization, or any other

organization or group of persons.” 2

U.S.C. §431(11). The Act contains a

broad prohibition against corporate

and labor contributions. Contributions given by other persons are

subject to the limits of the Act.

Additionally, contributions by

partnerships are permitted so long as

the contribution is attributed to both

the firm’s and each contributing

partner’s contribution limits. 11

CFR 110.1(e).

The Act does not address LLCs,

but, in advisory opinions, the

Commission has concluded that

LLCs in three different jurisdictions

are distinct from corporations and

partnerships, and thus fall within the

Act’s language of “any other

organization or group of persons.”

See the summary of AO 1997-4 on

page 12 of the June 1997 Record.

See also AOs 1996-13 and 1995-11.

In determining that LLCs in Virginia, Pennsylvania and the District

of Columbia were eligible to make

contributions in connection with

federal elections, the Commission

noted:

• The state’s recognition of the LLC

as a distinct form of business,

separate from a corporation or

partnership, with its own statutory

framework;

• The state’s requirements for

naming the LLC;

• The corporate attribute of limitation of liability for all members;

and

• The lack of the general corporate

attributes of free transferability of

interests and continuity of life.

The Missouri law pertaining to

LLCs is similar to the statutes in the

other locations where the Commission has determined that LLCs may

make contributions to federal

campaigns within the limits of the

Act and without dual attribution to

the LLC and its members (as is

1

 In Advisory Opinion 1984-23, cited in

the Explanation and Justification, the

Commission concluded that a list of

endorsements could be published in a

newsletter because the number of

nonmembers who received the newsletter was de minimus, or less than 1

percent. However, the use of a trade

journal as an organ to publish endorsements of federal candidates was

prohibited because the circulation

beyond the membership was more than

10 percent and, therefore, was not de

minimus.
November 1997 Federal Election Commission RECORD

7

required in the case of partnerships).

The Commission’s approval of these

contributions was conditioned upon

the assumption that none of the

members was in a category prohibited by sections 441b, 441c or 441e

of the Act. Thus, contributions from

an LLC in Missouri are permissible

so long as none of its members is a

corporation, federal contractor or

foreign national. To ensure that this

is the case, upon receipt of a contribution from a Missouri LLC, the

Nixon committee treasurer should

ask the LLC, orally or in writing,

whether any of its members fall

within the prohibited categories. If

the committee does not receive

written or oral (memorialized in

writing) confirmation that the

members do not, the committee

must return the contribution, in

compliance with 11 CFR 103.3(b).

Date: September 19, 1997;

Length: 4 pages. ✦

AO 1997-19

Corporate and Foundation

Donations to Promote City as

Presidential Convention Site

CoreStates Financial Corp. and

CoreStates Foundation may make a

$25,000 donation to Philadelphia

2000, a host committee working to

promote the city as the site for a

political party nominating convention in 2000. Such a donation would

not violate the Federal Election

Campaign Act’s (the Act’s) prohibitions on certain sources of contributions to federal campaigns.

CoreStates is a holding company

for two national banks, but it also

controls and derives profits—far in

excess of $25,000—from

nonbanking organizations. The

corporation’s charitable foundation,

a nonprofit Pennsylvania corporation, has been designated a

501(c)(3) organization by the

Internal Revenue Service. Both

CoreStates and the foundation are

located in the Philadelphia metropolitan area.

The proposed donation would be

used to defray some of the

Committee’s costs associated with

promoting Philadelphia as a convention site, including promotions,

lobbying and assistance with

financing convention-related

facilities and services. None of the

donations would be used in connection with a federal election.

The Act prohibits national banks

and federally chartered corporations

from making contributions in

connection with elections to any

political office—federal, state or

local—and prohibits other types of

corporations from making contributions or expenditures in connection

with any federal election. 2 U.S.C.

§441b(a). However, an exception to

this prohibition at 11 CFR

9008.52(c)(1)(i) allows local

businesses, local organizations and

local individuals to make donations

of funds or in-kind services to host

committees for limited purposes

involving the promotion of the city

as a convention site.1

 The regulations also allow donations for

general promotion of the city once it

has been selected as a convention

site and donations for other convention-related facilities and services.

Banks, however, are excluded from

these exceptions. However, in

Advisory Opinions 1995-32 and

1995-31, the Commission permitted

a host committee to accept donations from a holding company made

up, in part, of federally chartered

banks.

CoreStates is a local business,

and CoreStates Foundation is a local

organization. Consequently, they

may make the $25,000 donation to

1

 A local business is considered to be

one located within the metropolitan

area of the intended convention city, or

one that has a branch office located in

the metropolitan area. See the March

30, 1990, Federal Register notice, 55

FR 12154, for more information about

what constitutes a metropolitan area.

(continued on page 8)

FEC Conference

Schedule

 The FEC will hold several more

conferences during 1997 and

1998. To register for any of the

scheduled conferences, call

Sylvester Management at 1/800-

246-7277 or send an e-mail

message to:

TSYLVESTER@WORLDNET.ATT.NET.

Washington, DC

For corporate and labor

organizations

Date: November 6-7, 1997

Location: Madison Hotel

Registration: $180.50

Hotel rate: $124

Washington, DC

For trade associations and

membership organizations

Date: December 11-12, 1997

Location: Hyatt Regency Capitol

Hill

Registration: $180

Hotel rate: $145

Washington, DC

For candidate committees

Date: February 23, 1998

Location: Madison Hotel

Registration: $175

Hotel rate: $124

Denver

For candidates, political parties

and corporate and labor

organizations

Date: March 25-27, 1998

Location: Westin Tabor Center

Registration: $180

Hotel rate: $136

 Read future issues of the Record

to get scheduling information for

the following conference slated

for 1998:

Washington, DC

For nonconnected committees

April 1998
Federal Election Commission RECORD November 1997

8

Advisory Opinion Requests

Advisory opinion requests are

available for review and comment

in the Public Records Office.

AOR 1997-22

Forwarding membership

corporation’s endorsements of

federal candidates to members who

forward same to their restricted

classes. (Business Council of

Alabama, September 25, 1997; 5

pages plus 3-page attachment)

AOR 1997-23

Selling airline ticket purchased by

campaign volunteer with airline

employee discount to candidate for

discounted price. (Edwin J. Williams III, October 14, 1997; 1 page

plus 8-page attachment) ✦

terminate. The funds were reported

as a loan from the candidate.

In March, the Committee received an unexpected refund check

for $46,131 from a media outlet for

a prepaid advertisement that had not

been run. The Committee wanted to

refund that amount plus any remaining balance in its accounts to Ms.

Firebaugh, in repayment of her total

advance of $132,723 to her committee.

The Federal Election Campaign

Act (the Act) and Commission

regulations give a candidate wide

discretion in making committee

expenditures to influence his or her

election, but a candidate or authorized committee may not convert

excess campaign funds to personal

use. 2 U.S.C. §439a. FEC guidelines

define personal use as “any use of

funds in a campaign account...that

would exist irrespective of the

candidate’s campaign or duties as a

federal officeholder.” 11 CFR

113.1(g). Commission regulations

also state that excess campaign

funds may be used to repay to a

candidate any loan that was used in

connection with his or her campaign. 11 CFR 113.2(d). Thus, the

Committee may use the media

refund to repay Ms. Firebaugh for

the $7,723 loan she made to the

Committee.

In evaluating the other advance

that Ms. Firebaugh made to her

committee—the $125,000 advance—the Commission, among

other information, reviewed three

advisory opinions. See AOs 1991-9,

1980-114 and 1977-58. Based on

these opinions, the Committee may

not use the media refund to repay

Ms. Firebaugh for any donations to

the campaign that were not initially

reported as loans from her personal

funds and as outstanding debts of

the Committee. Converting a

previous candidate contribution to a

candidate loan would be contrary to

reporting requirements found at 2

U.S.C. §434(b) and 11 CFR

104.3(a) and (d) and 104.11. AddiAdvisory Opinions

(continued from page 7)

tionally, any use of the refund to

repay the candidate’s contributions

would represent a prohibited

conversion of excess funds to

personal use.

Date Issued: October 2, 1997;

Length 3 pages. ✦

AO 1997-21

Repayment to Candidate of

Advances to Campaign

Committee

The Firebaugh for Congress

Committee may use an unexpected

refund from a vendor to repay its

candidate, Emily Firebaugh, for a

loan she made to the Committee

during the 1996 election cycle. The

Committee may not, however, use

the refund to repay Ms. Firebaugh

for another donation she made to the

Committee that was not initially

disclosed as a loan.

Ms. Firebaugh was vying to

represent the 8th congressional

district of Missouri during the 1996

election cycle. In June 1996, the

Committee secured a bank loan of

$100,000, with Ms. Firebaugh as the

personal guarantor. When the loan

came due five months later, the

candidate advanced the Committee

$125,000 to repay the loan and

several other obligations. Because

the committee did not expect any

additional funds, it reported Ms.

Firebaugh’s donation as an in-kind

contribution.

In January 1997, Ms. Firebaugh

loaned the Committee $7,723 from

her personal funds to help close the

books and allow the Committee to

the host committee. In the case of

CoreStates, this opinion is contingent on the corporation’s ability to

demonstrate that only nonbank

funds are used for the donation and

that it is a distinct legal entity,

separate from its associated national

banks. In the foundation’s case, the

Commission notes that, in order to

maintain its tax-exempt status, the

foundation may not participate in

any political campaign on behalf of

any candidate for public office. 26

U.S.C. §501(c)(3).

Date Issued: September 19, 1997;

Length: 3 pages. ✦

Back Issues of the

Record Available on

the Internet

This issue of the Record and all

other issues of the Record from

1996 and 1997 are available

through the Internet as PDF files.

Visit the FEC’s World Wide Web

site at http://www.fec.gov and

click on “What’s New” for this

issue. Click “Help for Candidates,

Parties and PACs” to see back issues. Future Record issues will be

posted on the web as well. You

will need Adobe® Acrobat

Reader software to view the publication. The FEC’s web site has

a link that will take you to

Adobe’s web site, where you can

download the latest version of the

software for free.
November 1997 Federal Election Commission RECORD

9

FEC Faxline Menu

FEC Faxline documents may be

ordered 24 hours a day, 7 days a week,

by calling 202/501-3413 on a touch

tone phone. You will be asked for the

numbers of the documents you want,

your fax number and your telephone

number. The documents will be faxed

shortly thereafter.

Federal Election Commission

411. Complete Menu of All Material

Available

501. The FEC and the Federal

Campaign Finance Law

502. La Ley Federal relativa al

Financiamiento de las Campañas

503. Federal and State Campaign

Finance Laws

504. Compliance with Laws Outside

the FEC’s Jurisdiction

505. Biographies of Commissioners

and Officers

506. Telephone Directory

507. Table of Organization

508. Index for 1996 Record

Newsletter

509. Free Publications

510. Personnel Vacancy

Announcements

Disclosure

521. Guide to Researching Public

Records

522. Accessibility of Public Records

Office

523. Federal/State Records Offices

524. Using FEC Campaign Finance

Information

525. State Computer Access to FEC

Data

526. Direct Access Program (DAP)

527. Sale and Use of Campaign

Information

528. Combined Federal/State

Disclosure Directory 1997 on

Disk

529. Selected Political Party Organizations and Addresses

530. Internet Access to the FEC

531. Downloadable Databases via the

Internet

532. Electronic Filing Took Kit

Limitations

546. Contributions

547. Coordinated Party Expenditure

Limits

548. Advances: Contribution Limits

and Reporting

549. Volunteer Activity

550. Independent Expenditures

551. Local Party Activity

552. Corporate Communications/

Facilities

553. Trade Associations

554. Foreign Nationals

555. The $25,000 Annual Contribution Limit

556. Personal Use of Campaign

Funds

Public Funding

566. Public Funding of Presidential

Elections

567. The $3 Tax Checkoff

568. 1993 Changes to Checkoff

569. Recipients of Public Funding

570. Presidential Fund Income Tax

Checkoff Status

571. Presidential Spending Limits

Compliance

581. Candidate Registration

582. Committee Treasurers

583. Political Ads and Solicitations

584. 10 Questions from Candidates

585. Filing a Complaint

586. 1997 Reporting Dates

587. 1998 Congressional Primary

Dates

588. 1997 Special Election Reporting

Dates

589. 1997-1998 FEC Regional

Conference Schedule

Money in Politics Statistics

601. 1991-2 Political Money

602. 1997 Mid-Year PAC Count

603. 1993-4 Congressional

604. 1993-4 National Party

605. 1993-4 PAC Finances

606. 1995-6 Congressional

607. 1995-6 National Party

608. 1995-6 PAC Finances

609. 1997-8 National Party

610. 1997-8 Congressional

1996 Presidential

651. 1996 Presidential Primary Dates

652. Selected 1996 Campaign Names

and Addresses

653. Selected 1996 Campaign

Finance Figures

654. 1996 Public Funding Certifications and Payments

655. 1996 Presidential General

Election Ballots

656. 1996 Presidential General

Election Results

Office of Election Administration

701. List of Reports Available

702. Voting Accessibility for the

Elderly and Handicapped Act

703. National Voter Registration Act

Regulations

704. National Voter Registration Act

of 1993

705. The Electoral College

706. Organizational Structure of the

American Election System

707. Primary Functions of an

Electoral System

Forms

801. Form 1, Statement of Organization

802. Form 2, Statement of Candidacy

803. Form 3 and 3Z, Report for an

Authorized Committee

804. Form 3X, Report for Other Than

an Authorized Committee

805. Form 5, Report of Independent

Expenditures

806. Form 6, 48-Hour Notice of

Contributions/Loans Received

807. Form 7, Report of Communication Costs

808. Form 8, Debt Settlement Plan

809. Form 1M, Notification of

Multicandidate Status

Schedules

825. Schedule A, Itemized Receipts

826. Schedule B, Itemized Disbursements

827. Schedules C and C-1, Loans

828. Schedule D, Debts and Obligations

829. Schedule E, Itemized Independent Expenditures

830. Schedule F, Itemized Coordinated Expenditures

831. Schedules H1 – H4, Allocation

832. Schedule I, Aggregate Page

Nonfederal Accounts

Regulations (11 CFR Parts 100-201)

100. Part 100, Scope and Definitions

1007. Part 100.7, Contribution

1008. Part 100.8, Expenditure

101. Part 101, Candidate Status and

Designations

102. Part 102, Registration, Organization and Recordkeeping by

Political Committees

1021. Part 102.17, Joint Fundraising

by Committees Other Than SSFs

103. Part 103, Campaign Depositories

104. Part 104, Reports by Political

Committees

Information

(continued on page 10)
Federal Election Commission RECORD November 1997

10

Index

The first number in each citation

refers to the “number” (month) of

the 1997 Record issue in which the

article appeared. The second

number, following the colon,

indicates the page number in that

issue. For example, “1:4” means

that the article is in the January

issue on page 4.

Advisory Opinions

1996-35: Status of Green Party as

national committee, 1:10

1996-42: SSF disaffiliation following corporate spin off, 1:11

1996-45: Use of campaign funds,

1:12

1996-46: Continuation of exemption

from select FECA reporting

provisions, 4:7

1996-48: Application of “news

story” exemption, 2:5

1996-49: Affiliation between PAC

of joint venture partnership and

SSF of corporate partner, 3:7

1996-50: Disaffiliation of SSFs, 3:9

1996-51: Qualification as state

committee of political party, 3: 9

1996-52: Resolicitation of excess

campaign funds for nonfederal

campaign, 3:10

1997-1: Use of excess campaign

funds to establish foundation, 5:8

1997-2: Use of campaign funds for

congressional retreat fees, travel,

5:8

1997-3: Qualification as state

committee of political party, 6:11

1997-4: Application of contribution

limit to limited liability company,

6:12

1997-5: Qualification of lessee of

trading “seat” on Exchange as

member, 7:6

1997-6: Reinvestment by political

committee of investment income,

8:8

1997-7: Status as state committee of

political party, 8:9

1997-9: Collection of PAC contributions from individual members

through electronic debiting of

1047. Part 104.7, Best Efforts

105. Part 105, Document Filing

106. Part 106, Allocations of Candidate and Committee Activities

107. Part 107, Presidential Nominating Convention, Registration and

Reports

108. Part 108, Filing Copies of

Reports and Statements with

State Offices

109. Part 109, Independent Expenditures

110. Part 110, Contribution and

Expenditure Limitations and

Prohibitions

1101. Part 110.1, Contributions by

Persons Other Than Multicandidate Political Committees

1102. Part 110.2, Contributions by

Multicandidate Committees

1103. Part 110.3, Contribution

Limitations for Affiliated

Committees and Political Party

Committees; Transfers

1104. Part 110.4, Prohibited Contributions

1105. Part 110.5, Annual Contribution

Limitation for Individuals

1106. Part 110.6, Earmarked Contributions

1107. Part 110.7, Party Committee

Expenditure Limitations

1108. Part 110.8, Presidential Candidate Expenditure Limitations

1109. Part 110.9, Miscellaneous

Provisions

1110. Part 110.10, Expenditures by

Candidates

1111. Part 110.11, Communications;

Advertising

1112. Part 110.12, Candidate Appearances on Public Educational

Institution Premises

1113. Part 110.13, Nonpartisan

Candidate Debates

1114. Part 110.14, Contributions to

and Expenditures by Delegates

and Delegate Committees

111. Part 111, Compliance Procedure

112. Part 112, Advisory Opinions

113. Part 113, Excess Campaign

Funds and Funds Donated to

Support Federal Officeholder

Activities

114. Part 114, Corporate and Labor

Organization Activity

115. Part 115, Federal Contractors

116. Part 116, Debts Owed by

Candidates and Political

Committees

200. Part 200, Petitions for Rulemaking

201. Part 201, Ex Parte Communications

Recent Actions on Regulations,

Including Explanations

and Justifications

227. Electronic Filing of Reports by

Political Committees

228. Coordinated and Independent

Expenditures by Party Committees

229. Definition of “Member” of a

Membership Association

230. Petitions for Rulemaking: Soft

Money

231. Recordkeeping and Reporting

U.S. Code (Title 2)

431. Section 431 442. Section 442

432. Section 432 451. Section 451

433. Section 433 452. Section 452

434. Section 434 453. Section 453

437. Section 437 454. Section 454

4377. Section 437g 455. Section 455

438. Section 438

439. Section 439

441. Section 441

4411. Section 441a

4412. Section 441b

4413. Section 441c

4414. Section 441d

4415. Section 441e

4416. Section 441f

Advisory Opinions

9701-21. AOs 1997-1 through 1997-21

9601-52. AOs 1996-1 through 1996-52

9501-49. AOs 1995-1 through 1995-49

9401-40. AOs 1994-1 through 1994-40

9301-25. AOs 1993-1 through 1993-25

9201-44. AOs 1992-1 through 1992-44

9101-40. AOs 1991-1 through 1991-40

9001-40. AOs 1990-1 through 1990-40

Information

(continued from page 9)
November 1997 Federal Election Commission RECORD

11

their trading accounts held with

member firms, 9:4

1997-10: Transfers between campaign committees of different

election cycles, 10:5

1997-11: Use of campaign funds,

9:5

1997-12: Use of campaign funds,

10:5

1997-13: Relationship of limited

liability company’s nonconnected

PAC to parent corporations’

SSFs, 10:6

1997-14: Use of corporate contributions to build party headquarters,

10:8

1997-15: Establishment of

nonconnected PAC by incorporated membership organization’s

CEO, 11:4

1997-16: Methods of providing

PAC endorsements of federal

candidates to restricted class, 11:5

1997-17: Contribution limit of

limited liability company, 11:6

1997-19: Donations by corporation

and foundation to potential host

committee of presidential convention, 11:7

1997-21: Refund to candidate who

had made contribution to own

campaign, 11:8

Court Cases

FEC v. _____

– California Democratic Party, 7:5

– Charles Woods for U.S. Senate,

4:6

– Christian Action Network, 1:5;

5:5; 8:4

– Christian Coalition, 7:2

– DSCC (95-2881), 3:2; 8:3

– Fund For a Conservative Majority,

1:5; 11:1

– Kalogianis, 5:3

– Legi-Tech, 7:4

– McCallum, 2:4

– Orton, 6:6

– Parisi, 1:4

– Public Citizen, 4:6

– Williams, 2:3; 7:5; 11:2

_____ v. FEC

– Akins, 2:1; 7:5

– Bush-Quayle ‘92 Primary Committee, 3:5

– Clark, 5:1

– Clifton, 8:1

– Common Cause (96-5160), 5:4

– DCCC (96-0764), 1:4

– DNC (96-2506), 1:5; 5:5

– DNC (97-676), 6:7

– DSCC (96-2184), 1:2; 8:3

– Fulani (97-1466), 10:2

– Gottlieb, 7:5

– Hagelin, 6:7

– Hooker, 1:5

– Jones, 6:7

– Maine Right to Life, 11:2

– Minnesota Citizens Concerned for

Life, 7:2; 8:4

– NRCC (96-2295), 1:2

– Reilly, 1:4

– Right to Life of Dutchess Co.,

Inc., 6:8

– RNC (94-5248), 2:5

– RNC (97-1552), 9:1

– White, 10:2

Other Court Cases

– DSCC v. NRSC, 10:1

Reports

Electronic Filing, 2:1; 5:9; 7:10

July Reporting Reminder, 7:1

Schedule for 1997, 1:6

Special Election, New Mexico, 4:3

Special Election, New York, 10:12

Special Election, Texas, 3:6; 4:3

800 Line

Amended reports, 4:2

Debt settlement and committee

termination, 1:8

Change of Address

Political Committees

 Treasurers of registered political

committees automatically receive

the Record. A change of address

by a political committee (or any

change to information disclosed

on the Statement of Organization)

must, by law, be made in writing

on FEC Form 1 or by letter. The

treasurer must sign the

amendment and file it with the

Secretary of the Senate or the

FEC (as appropriate) and with the

appropriate state office.

Other Subscribers

 Record subscribers who are not

registered political committees

should include the following

information when requesting a

change of address:

• Subscription number (located on

the upper left corner of the

mailing label);

• Subscriber’s name;

• Old address; and

• New address.

 Subscribers (other than political

committees) may correct their

addresses by phone as well as by

mail.
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Federal Election Commission RECORD November 1997