September 19

Commissioner Aikens, who is from Swarthmo

Pennsylvania, has been a member of the Comm

sion since it was created in 1975. Her curre

term is scheduled to expire on April 30, 19

Commissioner Elliott, from Skokie, Illinois, a

Commissioner McDonald, from Sand Sprin

Oklahoma, were named to terms scheduled 

expire on April 30, 1987.

Definition of Debt Settlement Statement

A debt settlement statement is a writt

agreement between a committee and creditor 

which the creditor agrees to forgive a debt 

allowing the committee to pay less than t

amount it still owes on the debt. Debt settleme

statements do not include:

An agreement reached by a creditor and 

committee concerning the amount of a d

continu

DEBT SETI'LEMENT PROCEDURES

REVISED

On July 22, 1982, the Commission approv

revisions to its procedures for reViewing d

settlement statements submitted by politi

committees that have settled debts with credit

for less than the amount owed. The revised F

Directive No.3, effective July 22, 1982, sup

sedes previous FEC directives on debt settleme

procedures. The directive defines a debt sett

ment statement, lists the supporting documen

tion a committee must submit with its stateme

and outlines FEC review procedures to ensure t

statements are in compliance with the Act a

Commission Regulations. (See 2 U.S.C. §434(b

and Commission Regulations at II CFR 100.7

(4) and 114.10.) Highlights of the revised pro

dures are provided below. More detailed inform

tion may be obtained by requesting a copy of t

revised Directive No.3 from the FEC's Pub

Records Office. Call 202-523-4181 or toll fr

800-424-9530.

THE FEDERAL ELECTION

COMMISSION

9/8/82 9/11/82

Mailing Date of

Report (if sent

by registered or

eertified mail) Filing Date

9/3/82

New York PrillUlrY

Closing Date

of Books

President Reagan had nominated Commissioners

Aikens and Elliott, both Republicans, on November 24, 1981, and Commissioner McDonald, a

Democrat, on December 14, 1981. On December

17, after Congress had adjourned before acting on

the nominations, the President named the Commissioners to recess appointments. The Senate

Rules Committee held confirmation hearings in

June, and the nominations were confirmed by the

full Senate in July.

NEW YORK PRIMARY RESCHEDULED

New York will hold its primary election on September 23 instead of September

14. The new schedule for filing the 12-day

pre-election report by committees supporting candidates for federal office in the

primary is as follows:

Volume 8, Number 9

1325 KStreet N.W 0' Washington, D.C. 20463

FEC COMMISSIONERS SWORN IN

On August 3, 1982, three members of the

Federal Election Commission were sworn into

office as Senate-confirmed Commissioners after

having served six months as recess appointees. In

an afternoon ceremony at the Commission, Commissioners Joan D. Aikens, Lee Ann Elliott and

Danny Lee McDonald were administered the oath

of office by Associate Justice Sylvia Bacon of the

Superior Court of the District of Columbia.
2

The Record is published by the Federal Election Commission, 1325 K Street, N.W., Washington,

D.C. 20463. Commissioners are: Frank P. Reiche, Chairman; Danny Lee McDonald Vice

Chairman; Joan D. Aikens; Lee Ann Elliott; Thomas E. Harris; John Warren McGarry; Wullam F.

Hildenbrand, Secretary of the Senate, Ex Officio; Edmund L. Henshaw, Jr., Clerk of the House of

Representatives, Ex Officio. For more information, call 202/523-4068 or toll-free 800/424-9530.

Commission Review

The Commission will review the informatio

submitted with a debt settlement statement f

completeness and will notify a committee if 

requires additional information. Once the Com

mission has sufficient information, the Office 

General Counsel will determine whether, on th

face of the statement, there is an apparent viol

tion of the Act or FEC Regulations.

Acknowledge receipt of the statement; and

Inform the committee that it must contin

reporting the debt(s) until the Commissio

has determined that the statement is in com

pliance with the Act and Commission Regul

tions, 

A debt settlement statement and any relat

documents (e.g., FEC requests for additional i

formation concerning the statement) will b

placed on the public record with a committee

other reports and statements.

Note: To expedite processing of debt settleme

statements, committees should submit the

statements independent of other submissions an

reports.

ADVISORY OPIHION REQUESTS

The following chart lists recent requests f

advisory opinions (AORs). The full text of eac

AOR is available to the public in the Commi

sion's Office of Public Records.

AOR Subject

1982-47 Candidate's three Senate primary cam

paigns as separate elections for pu

poses of contribution limits. (Da

made public: August 6, 1982; Length: 

pages)

1982-48 Coordinated (S441a(d» expenditur

made by state party committee on b

half of independent House candidat

(Date made public: August 6, 198

Length: 1 page)

1982-49 Contributions designated for prima

runoff used for expenses anticipatin

runoff. (Date made publics August 1

1982; Length: 2 pages)

puted debt, provided the committee pays the

agreed-upon amount; or

An agreement to reduce a committee's debt

when the amount originally reported as owed

to the creditor is later reduced because this

amount was an estimate that exceeded the

actual cost of goods or services provided to

the committee.

Under these two circumstances, the committee is

not required to submit a statement, but reports

any change in debt status on Schedule D as an

amendment to its report.

Doeumentation for Debt Settlement

Statement

In order to prevent the unpaid amount of a

debt from becoming an impermissible contribution

to a committee from its creditor (l.e., a prohibited contribution from a corporate .eredltor or an

excessive contribution from a noncorporate creditor), the debt settlement statement must indicate

that the creditor has made a commercially rea-.

sonable attempt to collect the debt. The committee must submit the following information as

evidence of this effort:

Evidence that the creditor is in agreement

with the terms of the debt settlement. For

V'/. example, the committee may submit a letter

from the creditor indicating the creditor has

agreed to accept partial, rather than full,

payment for the loan.

;

:...- Steps taken by the candidate or the committee to payoff the debt. For example, the

committee may provide evidence indicating

the amount of the debt liquidated by the

committee or any efforts made to negotiate

payment with the creditor, including written

correspondence with the creditor and records

of phone calls made to the creditor.

j -- Steps taken by 'the creditor to obtain payment of the debt from the committee. The

committee may, for example, submit bills

and correspondence from the creditor concerning the debt.

Terms of Credit. The debt settlement statement should indicate the amount of the outj standing debt and the amount the creditor

has agreed to forgive.

Submission of Debt Settlement Statement

A political committee -- not its creditors --

should submit the debt settlement statement and

any supporting. documentation. When the Commission receives a debt settlement statement from a

committee, it will:
ALTERNATE DISPosmON OF ADVISORY

OPINION REQUEST

In response to AOR 1982....013 (affiliated committee status for PACs established by two

corporations and by a joint venture corporation formed by the two corporations), the

General Counsel informed the requester in a

letter issued July 22, 1982, that the Commission had failed to approve an advisory opinion

by the requisite four-vote majority.

ADVISORY OPIHIONS: SUMMARIHS

An Advisory Opinion (AO) issued by the Commission provides guidance with regard to the

specific situation described in the AOR. Any

qualified person who has requested an AO and

acts in accordance with the opinion will not be

subject to any sanctions under the Act. Other

persons may rely on the opinion if they are

involved in a specific activity which is indistinguishable in all material aspects from the activity

discussed in the AO. Those seeking guidance for

their own activity, however, should consult the

full text of an AO and not rely only on the

summary given here.

AO 1982....010: Conversion of Membership

Organization's State PAC

to Federal PAC

APEP is the political action fund of the Ohio

Farm Bureau Federation, Inc. (OFBF), an incorporated membership organization, which has been

used to support state candidates. It may become a

(federal) separate segregated fund (PAC) and support federal elections by using funds originally

donated for state elections. APEP's use of state

funds is perm issible because:

I. The funds contain no corporate contributions.

(Since Ohio law prohibits corporate contributions, the state PAC restricted its solicitations to OFBF's individual mernbers.)

2. The funds were solicited from bona fide

members of OFBF only -- i.e., individuals

who participated, through voting control in

local farm bureaus, in the direction of OFBF,

who had rights and interests in OFBF, and

who helped support OFBF through regular

dues payments.

3. Although APEP's original solicitation for

state funds did not meet all the literal requirements of FEC Regulations for soliciting

federal funds, its solicitations were in substantial compliance with the Regulations.

Specifically, the solicitations made clear that

contributions: a) were entirely voluntary; b)

would be used for political purposes (l.e., to

support state legislators who were "Friends

of Agriculture"); and c) were not a condition

for continued membership in OFBF. The

Commission noted, however, that in the future APEP would have to meet all the solicitation requirements of Section 114.5 of Commission Regulations.

3

Once converted into a federal PAC, howeve

APEP must:

1. Disclose, on its first report, the source of i

cash on hand, along with the informatio

required by Section 104.3 of Commissio

Regulations; and

2. Exclude from use in federal elections an

funds that are not permissible under the Act

Additionally, since OFBF has trade associatio

status under Commission Regulations (I I CF

114.8(a», it may solicit contributions to the fe

eral PAC from its individual members, as well 

from the solicitable personnel of its corpora

members, provided the solicitations meet the r

quirements of the Act and Commission Reg

lations. 2 U.s.C. S44Ib(b)(4)(D); 11 CFR 114

The federal PAC may also accept WISOlicit

contributions from other unaffiliated politic

committees. 11 CFR 114.5(j) and 114.7(j). Com

missioner Thomas E. Harris filed a dissentin

opinion. (Date issued: July 15, 1982; Length: 

pages, including dissent)

AO 1982-42: Union's Reimbursement to

PAC for Administrative Costs

The National Treasury Employees Union (NTEU

may not reimburse its separate segregated fun

the Treasury Employees Political Action Commi

tee (TEPAC), for a portion of TEPAC's establis

ment, administration and solicitation costs, whic

TEPAC stated it had "inadvertently paid" betwee

1979 and 1981 as the result of a "mistaken im

pression" that these costs were attributable to it

If NTEU had originally paid all the costs incurre

in establishing and administering TEPAC, its pa

ments would have been fully exempt from th

Act's definitions of "eontribution" and "expend

ture." 2 U.S.C. S44Ib(b)(2)(C). By reimbursin

TEPAC three years later, however, NTEU Wou

be making a prohibited contribution to TEPA

because the funds would, in effect, be used fo

contributions rather than for exempt expend

tures. 2 U.S.C. S44Ib(b)(3)(A); 11 CFR 114.5(a).

The Commission distinguished this ruling from

those in AOR 1976-111 (an Opinion of Counse

and AO 1979-33. In AOR 1976-111, issued befor

Commission regulations had been prescribed, th

Commission had ruled that a labor organizatio

could reimburse its separate segregated fund for 

legal service fee inadvertently paid by the fun

TEPAC's inadvertent payments, however, did no

consist of a legal fee, and they occurred over 

three-year period during which time TEPAC coul

have consulted Commission Regulations governin

the administration of separate segregated fund

or could have availed itself of the advisory opin

ion procedures. Similarly, in AO 1979-33 th

. . ' Commission had ruled that a union could reim

burse its separate segregated fund for the costs o

a banquet which the union had mistakenly unde

continue
stood to be a political fundraiser. That reimbursement merely corrected a single, factual mistake

rather than rectifying a course of considered,

discretionary actions conducted over several

years, as in TEPAC's case. (Date issued: July 15,

1982; Length: 5 pages)

AO 1982-45: Affiliated status of Public

WorksOrganizations for

Purposes of PAC Solicitations

The Salt River Valley Water Users' Association

(the Association), the organization representing

landowners for whom the federal government

sponsored the Salt River irrigation project, and

the Salt River Project Agricultural Improvement

and Power District (the District), the quasigovernmental organization created to provide inexpensive bond financing for the project, are

considered affiliated organizations for purposes of

solicitations conducted by either the Association's

separate segregated fund, the Project Political

Improvement Committee (PPIC), or by the separate segregated fund of the International Brotherhood of Electrical Workers' (IBEW's) local union,

Local 266.

The District and the Association are considered

affiliated organizations by virtue of their close

financial and managerial interrelationships. Specifically, the District holds all the Association's

property and provides the Association with capital

and operating funds for the Salt River Project

(the Project); the District and Association share

joint responsibility for the Project's operation; the

organizations are managed by the same individuals; and the District's membership consists solely

of the Association's members. Accordingly:

I. The Association or PPIC may solicit the

District's and the Association's executive and

administrative personnel and their families at

any time. II CFR 114.5(g)(I).

2. The Association or PPIC may solicit the

nonexecutive employees of both the District

and the Association twice a year. II CFR

114.6.

3. If either the Association or the District solicits contributions to PPIC by using a payroll

deduction plan, it must also make the plan

available to the separate segregated fund of

Local 266 for solicitation of union members

who are employed by the District and the

Association. II CFR 114.5(k)(I). (Date issued: July 30, 1982 ; Length: 4 pages)

AO 1982-46: Political Committee Status for

State PAC Contributing to

Federal Committee

A separate segregated fund becomes a "political

committee" under the Act when it makes contributions of any amount in connection with federal

elections. The TMHA-Committee for Responsible

Government (TMHA-CRG), a nonfederal political

committee sponsored by the Texas Manufactured

Housing Association, thus became a "political

committee" when it contributed $1,000 to a fed4

eral political committee. 2 U.S.C. §§43I(4)(A

(C). It was therefore required to register with th

Commission within 10 days of making the contr

bution, file periodic reports and otherwise comp

with the Act and Commission Regulations. 

U.S.C. §§433(a) and 434(a)(4). Moreover, in th

first report it files, TMHA-CRG has to disclo

any funds received prior to becoming a feder

political committee, even if the funds were n

received during the current reporting period. 

CFR 104.3(a) and 104.12.

As a federal political committee financing poli

cal activity in connection with both federal an

nonfederal elections, TMHA-CRG had two regi

tration and reporting options,

I. It could have established a separate accou

for federal election activity, which would b

treated as a separate political committe

subject to the requirements of the Act an

Commission Regulations.

2. Alternatively, TMHA-CRG could have regi

tered as a political committee with a sing

account for federal and nonfederal electio

activity. In this case, TMHA-CRG could on

receive contributions permissible under th

Act, regardless of whether the contributio

were used for federal or nonfederal election

II CFR 102.5(aXI)(i) and on, (Date issue

July 29, 1982; Length: 3 pages)

INTHRNATIONAL ASSOCIATION OF

MACIDNlSTS AND AEROSPACE

WORKERS v. FEe

On April 6, 1982, the U.S. Court of Appea

for the District of Columbia Circuit, sitting

bane, issued an opinion in International Assoc

TIon of Machinists and Aeros ace Workers lAM

v. FEC Civil Action No. 81-1664 that reject

three constitutional challenges to section 44Ib(

(3) of the election law, a provision that prohib

corporations and labor organizations from coe

cing contributions from their solicitable perso

nel. The U.S. District Court for the District 

Columbia had certified the Constitutional que

tions to the appeals court on June 3,1981, follow

ing its December 16, 1980, ruling in the suit.

Plaintiffs' Claim

In their suit, lAM and six other plaintiffs fir

claimed that the FEC had acted contrary to la

in dismissing their complaint, which alleged th

eleven corporations had systematically violated 

U.S.C. §44Ib(b)(3) by soliciting contributions 

their separate segregated funds (political acti

committees or PACs) from "unprotected" admi

istrative personnel under "inherently coerciv

conditions. Alternatively, if the district court d
•

•

•

nied the relief requested in their first claim,

plaintiffs sought eertifleation of the constitutional questions raised in their suit to an en bane

appeals court, pursuant to 2 U.S.C. S437h.- --

District Court Ruling

The district court concluded, however, that

the FEC's determination had not been arbitrary,

capricious or contrary to law. Applying the standard for permissible corporate solicitations set

forth in Pi efitters Local Union No. 562 v. U.S.

(407 U.S. 385 1972 , and later eodi ied in Section

44Ib(b)(3) of the Act, the court stated: "[N]owhere does FECA (Federal Election Campaign

Act) forbid corporate supervisors from asking

their subordinates for contributions as long as

they comply with the provisions of section 441b

(b)(3)." The court concluded "Neither the administrative complaint nor the complaint in this

Court, offers direct evidence of wrongdoing." The

same court ruled, however, that plaintiffs had

standing to have their constitutional issues certified to the appeals court.

Appeals Court Ruling

In separate decisions, the appeals court affirmed the district court's decision that the Commission's dismissal of the complaint was not contrary to law, and also ruled on each of plaintiffs'

constitutional questions, as summarized below:

Is the asserted imbalance between corporations

and labor unions IDlder the 1976 FECA amendments [codified at 2 U.s.C. S44Ib(bX311 uneonstitutional?

Plaintiffs claimed that, in permitting corporate PACs to solicit their executive and administrative personnel in addition to their shareholders,

the 1976 amendments had violated Fifth Amendment rights of equal protection and First Amendment rights of free speech by upsetting the longstanding balance in political power that had existed between corporations and labor organizations prior to enactment of the 1976 amendments.

They argued that Congress had not intended to tip

this balance in favor of corporations; rather,

Congress had not foreseen the effect of the

amendments, namely, the proliferation of corporate PACs and their disproportionate influence on

federal elections. Since there are many more

corporations than labor organizations, plaintiffs

claimed the imbalance is institutional and, consequently, cannot be corrected by labor organizations.

The appeals court found, however, that Congress

had attempted to treat labor organizations and

corporations in a comparable manner in both the

1971 and 1976 amendments, while taking into

account the structural differences between them.

By restricting corporate PAC solicitations to

administrative and executive employees and

shareholders in the 1976 amendments, Congress

had restored a similar, if not identical, balance to

that which had existed prior to the FEC's 1975

5

ruling in the SUNPAC advisory opinion (AO 19

23). (The SUNPAC opinion permitted corporatio

to solicit not only their shareholders but all th

employees as well.)

By including executive and administrative pers

nel in a corporation's solieltable personnel, C

gress had taken into account the structural diff

ences between labor organizations and corpo

tions, while applying the standard for solicita

personnel even handedly. The appeals court no

that, in this regard, "it is•••more likely tha

corporation's career employees will identify w

the corporate direction, purpose, and welfare th

will a shareholder who does not own a controll

interest."

In affirming Congress' decision to shape the so

itation procedures of the election law to refl

differences in organizational structure, the 

peals court cited recent rulings of the U.S. Co

of Appeals for the Seventh Circuit that upheld 

constitutionality of other solicitation arran

ments. For example, in Bread PAC v. FEC,* 

court rejected a Fifth Amendment challenge 

restrictions placed on a trade association seek

to solicit the solioitable personnel of its mem

corporations. Similarly, in California Medical 

sociation v. FEC,* the court rejected an eq

protection challenge to a provision which proh

its unincorporated associations, unlike corpo

tions and labor organizations, from spending 

limited funds to establish and administer a po

cal action committee.

Furthermore, the appeals court cautioned t

"the Constitution, as historically and curren

interpreted, does not afford any guarantee aga

one person's or group's ability to fund more spe

than can another. In fact, far from imposing 

Congress an obligation to equalize the voices 

corporate and labor PACs, the Constitution, 

the Supreme Court now reads it, may for

Congress to act in such a manner. See Buckle

Valeo, 424 U.S. at 48-49."

Does the statute impair career employees' F

Amendment right of political abstention by p

mitting the corporate PAC solicitation as detai

in the record?

Plaintiffs alleged that, even though Sect

44Ib(b)(3) sanctions corporate PAC solicitati

of executive and administrative personnel, th

solicitations are inherently coercive, in violat

of First Amendment free speech rights. As 

dence of this coercion, plaintiffs pointed out t

executive and administrative employees "give 

the corporate political fund at rates and 

amounts far beyond those which obtain w

contin

*Bread PAC v. FEC is summarized on p. 6 

the May 1981 Record. California Medical Asso

tion v. FEC is summarIzed on p, 1 ot the Aug

1981 Record.
The Committee also seeks the court's review o

an FEC decision to compute its repayments on th

basis of both private and publfe funds held by th

Committee.

U.S. Court of Appeals for the District of Colum

bia Circuit, Docket No. 82-1754, July 6,1982.

·Pursuant to 26 U.S.C. §9038, the Commi

sion is required to audit the campaign of an

primary candidate who receives public matchin

funds.

"·Presidential committees accepting primar

matching funds are subject to state-by-sta

spending limits for their primary campaigns. Ex

penditures in excess of these limits must b

repaid to the U.S. Treasury. 2 U.S.C. §44Ia(b

(I)(A) and 26 U.S.C. §§9035(a) and 9038(b).

with regard to the FEC's audit of the Committee

1980 primary campaign.· Specifically, the Com

mittee alleges that the Commission committed a

error by failing to:

Afford the Committee a hearing at any stag

of the audit process.

Permit the Committee's good faith relianc

on state expenditure estimates, prepared by 

certified public accountant, which wou

have allowed the Committee to reduce i

repayment obligation.··

Reduce the Committee's repayment oblig

tion. The Committee claims that repaymen

required for overspending in certain stat

should be reduced because campaign deb

owed in these states have been lowered.

1982-4 Notice of Filing Dates for Special Pri

mary and Special General Elections

17th Congressional District, Ohio (Dat

published: May 17, 1982; Citation: 4

Fed. Reg. 21142)

1982-5 Candidate's Use of Property in Whic

Spouse Has Interest; Notice of Propose

Rulemaking (Date publlshede July 20

1982; Citation: 47 Fed. Reg. 31390)

11 CFR Parts 106 and 9031 et seq

Presidential Primary Matching Fund

Notice of Proposed Rulemaking (Dat

published: August 17, 1982; Citation

47 Fed. Reg. 35892)

The items below identify FEC document

that appeared in the Federal Register betwee

May and August 1982. Copies of the notices ar

available in the Public Records Office.

Notice Title

1982-6

6

donors are not solicited to give to the institution

that employs them." The appeals court said, however, "One could argue with equal force that

career employees contribute to their corporate

PACs out of a desire to further what they perceive to be their own best interests or the best

interests of the corporation, and because they

have the wherewithal to do so, not because they

are coerced or intimidated."

Nor did the court find any merit to plaintiffs'

contention that the 1976 amendments constituted

a form of government-compelled activism on the

part of PAC contributors.

Does the use of general corporate assets to establish and support a corporate PAC violate the First

Amendment rights of dissenting shareholders?

Plaintiffs claimed that the FECA provision

permitting corporations to use treasury funds to

establish and administer a PAC abridge the free

speech rights of shareholders who objected to

such use of corporate assets. The court found that

the chief case cited by plaintiffs in support of

their claim, Abood v. Detroit Board of Education,

was not applicable. The appeals court pointed out

that "in Abood the [SupremEi! Court had held that

the First Amendment prohibited a public employee union from requiring any employee 'to contribute to the support of an ideological cause he may

oppose as a condition of holding a job." A corporate shareholder, the court reasoned, is under no

such compulsion, Citing the Supreme Court's decision in First National Bank of Boston v. Bellotti,

the appeals court said "tTl he shareholder invests

in a corporation of his own volition and is free to

withdraw his investment at any time and for any

reason." 435 U.S. at 794 n, 34.

Garter/Mondaie Presidential

Committee, Inc. v. FEC

The Carter/Mondaie Presidential Committee,

Inc. (the Committee) asks the appeals court to

review certain final Commission determinations

NEW LlTIGATION

Deferring to Congress' judgment, the appeals

court further held that the 1976 amendments

extended the same protections against coercion to

corporate executive and administrative personnel

that had been provided to union members and

shareholders in the 1971 amendments. It had no

"evident reason to believe that protections...relied upon to secure union members against union

pressure would be less adequate in securing career

employees against corporate pressure." The appeals court reasoned that a more important consideration was the risk of coercion that corporate

solicitations posed for a corporation's hourly wage

earners. ''The statutory language plainly demonstrates that concern: solicitation of hourly employees is severely restricted; solicitation of career employees is 'generally permitted, but is

brigaded with protections designed to prevent

overreaching."
•

•

•

SUMMARY OF MURs

The Act gives the FEC exclusive jurisdiction

for its civil enforcement. Potential violations are

assigned case numbers by the Office of General

Counsel and become "Matters Under Review"

(MURs). All MUR investigations are kept confidential by the Commission, as required by the

Act. (For a summary of compliance procedures,

see 2 U.s.C. §§437g and 437(d)(a) and 11 CFR

Part i n.)

This article does not summarize every stage in

the compliance process. Rather, the summary

provides only enough background to make clear

the Commission's final determination. Note that

the Commission's actions are not necessarily

based on, or in agreement with, the General

Counsel's analysis. The full text of this MUR is

available for review and purchase in the Commission's Public Records Office.

MUR 1399: Independent Expenditures

Made by Projects of

National Independent

Expenditure Committee

On May 5, 1982, the Commission found no reason

to believe that the Act had been violated by

either a national independent expenditure committee or by seven projects sponsored by the

committee to make independent expenditures advocating the defeat of various 1980 Senate candidates.

Complaint: On November 2, 1981, a national political committee (with no sponsor) filed a complaint against seven respondents who had allegedly made independent expenditures to oppose the

election of selected Senate candidates during the

1980 elections. (After reviewing the complaint,

the General Counsel also named an independent

expenditure committee as a respondent.) The

complainant alleged that:

1. The respondents had failed to register and

report as political committees, in violation of

2 U.S.C. §§433 and 434.

2. In many cases, the title of the respondent had

included the name of the candidate the respondent had sought to defeat, in violation of

2 U.S.C. §432(e)(4). Alternatively (if the

Commission concluded the respondents were

not political committees) the independent expenditure committee had violated §432(e)(4)

by including the names of the candidates in

the titles of the groups it identified as sponsors of its communications with the public.

3. The initial respondents and the independent

expenditure committee had failed to identify

themselves as affiliated committees or connected organizations, in violation of 2 U.S.C.

§433(b)(2).

7

Although it made no formal allegation, the co

plainant committee also expressed concern th

by calling the respondents "projects," the indepe

dent expenditure committee misrepresented th

purpose and prevented full public scrutiny of th

activities.

General Counsel's Report:

Political Committee Status of the Projects. T

complainant had alleged that the respondents h

failed to register as political committees a

report to the FEC when each had made indep

dent expenditures exceeding $1,000 to oppose 

election of a targeted Senate candidate dur

1979 or 1980. As examples of the responden

independent expenditures, the complainant cit

their distribution of campaign literature, th

purchase of radio advertisements and their soli

tation of contributions for independent expen

ture activities. In support of its allegation, t

complainant submitted a budget, prepared by 

independent expenditure committee, that show

"planned expenditures for both the [sicl mailin

as well as the radio advertisements."

The General Counsel" found, however, that 

independent expenditure committee's budg

along with other evidence, supported the oppos

conclusion, namely, that the respondents were n

political committees but, instead, were progra

or projects sponsored by the committee. In 

committee's budget, the respondents were d

cussed in the context of the committee's strate

to defeat certain incumbent Senate candidates 

the 1980 elections. Moreover, as noted by 

General Counsel, the independent expendit

committee's chairman and treasurer had auth

rized each respondent (Le., project), had iden

fied each respondent's bank account on the co

mittee's Statement of Organization and had d

closed each respondent's financial activity on 

committee's reports and statements. In additi

the authorization notice appearing on each co

munication clearly identified the respondent a

"project" of the independent expenditure comm

tee: "Paid for by [respondent's name], a project 

the Committee, and not authorized 

any candidate."

Use of Candidates' Names. As to the compla

ant's allegation that the respondents had violat

Section 432(e)(4), which permits only those pol

ical committees authorized by a candidate to u

his or her name in their titles, the independe

expenditure committee asserted that the respo

dents were not subject to this provision becau

they were not political committees. Rather, t

respondents' titles (e.g., "Anybody But Candida

X") constituted political slogans protected 

First Amendment rights of free speech. The Ge

eral Counsel found that, since the responden

were not political committees, they were n

subject to Section 432(e)(4). Moreover, the ind

pendent expenditure committee had not violat

Section 432(e)(4) because its title did not inclu

the name of any candidate.

continu
Failure to Report as Connected Organizations.

The complainant contended that the respondents

had administered and financially supported the

independent expenditure committee, and, thus,

should have been named as connected organizations on the committee's Statement of Organization. To support this allegation, the complainant

cited the following evidence that the respondents

had sponsored the independent expenditure committeei the respondents administered the independent expenditure committee's program to defeat

the targeted Senate candidates; and the respondents provided financial support to the independent expenditure committee by soliciting funds on

the committee's behalf.

The General Counsel found, however, that the

respondents were not connected organizations of

the independent expenditure committee, as defined by Section IOO.6{a) of Commission Regulations, because they had not established, administered or financially supported the independent

expenditure committee. To the contrary, the independent expenditure committee had established

and administered the respon~entsr programs.

The General Counsel therefore recommended that

the Commission find no reason to believe that

either the independent expenditure committee or

its projects had violated any of the provisions

cited in the complaint.

Commission Determination: On May 5, 1982, the

Commission voted to find no reason to believe

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that either the independent expenditure commit

tee or its projects had violated any of the prov

sions of the Act alleged by the complainant. No

had the independent expenditure committee vio

lated 2 U.S.C. S432(e)(4) by using a candidate

name in its title,

SRLECI'ED BIBLIOGRAPHY

OF CAMPAIGN FINANCE

LAWS AVAILABLE

During July 1982, the FEC's Library issued 

Campaign Finance and Federal Elections Bibliog

~. The Bibliography, which is updated biannu

ally, provides a selected, annotated compilatio

of publications issued from January 1977 throug

June 1982. Documents are listed according to fou

information categories:

Part I: Documents pertaining to the 197

Amendments to the Federal Electio

Campaign Act (Pub. L. 96-187).

Part D: Books, monographs and treatises.

Part m: Guidebooks, handbooks, compilations

bibliographies and indices.

Part IV: Law review articles and articles from

business, political science and genera

periodical indices.

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