• 

• 

• 

THE FEDERAL ELECTION 

COMMISSION 

1325 K Street N.W ., Washington, D.C. 20463 

Volume 5, Number 5 

ADVISORY OPINION REQUESTS 

The following chart lists Advisory Opinion Requests 

(AOR's), with a brief description of the subject matter, 

the date the requests were made public and the number of 

pages of each request. The full text of each AOR is avail· 

able to the public in the Commission's Office of Public 

Records. 

Date Made No. of 

AOR Subject Public Pages 

1979·10 Appearance of union bug 3/19/79 3 

(mark) on candidate 

brochures and stationery. 

1979·11 Use of proceeds from 1968 3/29/79 3 

fundraiser to defray Federal 

officeholder's non-reimbursable 

office expenses. 

1979·12 Allocation of proceeds from 3/29/79 

ticket sales for political rally 

and fundraiser. 

ADVISORY OPINIONS: SUMMARIES 

Designated as AO's, Advisory Opinions discuss the 

application of the Act or Commission Regulations to 

·specific factual situations. Any qualified person requesting 

an Advisory Opinion who in go-od faith acts in accordance 

with the opinion will not be subject to any sanctions under 

the Act. The opinion may also be relied upon by any other 

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

in the Advisory Opinion. Those seeking guidance for their 

own activity should consult the full text of an Advisory 

Opinion and not rely only on the summary given here. 

May 1979 

AO 1979·5: Committee Termination 

The Brathwaite for Congress Committee {the Committee) 

may file a termination report if the Committee extinguishes 

its outstanding debts in the manner which the Commhtee 

proposed to the Commission. 

Two persons owe refunds to the Committee for camp8ign 

services promised but not rendered; the- Committee Owes 

the candidate a balance on an outstanding loan which 

exceeds the sum of the refunds owed to the Committee 

(refund claims). In order to extinguish its debts, the Com· 

mittee has proposed the following transfer: 

1. The Committee will assign its two refund claims to the 

candidate. 

2. The candidate will give the Committee credit for a loan 

repayment ·equal to the sum of the two claims. Since the 

loan exceeds that sum, the candidate will forgive the 

remaining balance on the Joan. 

The Commission concluded that the proposed assignment 

of Committee claims to the candidate would effectively 

transfer those obligations owed to the Committee to the 

candidate. If the candidate then forgave the balance remain· 

ing after the transfer, that action wo'uld extinguish the 

Committee debt. 

If the Committee has no other outstanding debts or obliga· 

tions, and satisfies all other requirements of· 11 CFR 

102.4(a) and (b), the Committee may file a termination 

report and end its reporting obligations. 

The Commission noted that when the Committee assigns 

its refund claims to the candidate in full payment of its 

debt to him, that debt is extinguished whether or not he 

ever receives the refund payments. (Length: 2 pages) 

ADVISORY OPINION 

REQUESTS WITHDRAWN 

Since Marcil 1979, the following Advisory Opinion 

Requests were withdrawr:'l. by their requesters: 

·· AO 1978·84 

·· AO 1978·101 
FEC v. CFR 

On March 1, 1979, the U.S. District Court for the 

District of Columbia granted summary judgment to Citizens 

for the Republic (CFR), defendants in a suit filed by the 

FEC. In granting judg.ment to the defendant, the Court 

_found that there was no genuine issue as to any material 

fact. 

On August 11, 1977, the Commission found reasonable 

cause to believe that Citizens for the Republic (formerly 

Citizens for Reagan, principal campaign committee for 

former Presidential candidate Ronald Reagan) had violated 

the Act by failing to report or make best efforts to report 

the occupations and principal places of business of 35% of 

those persons who had contributed an aggregate of $100 or 

more to the candidate, as required by 2 U.S.C. §434(b)(2). 

On June 23, 1978, the Commission filed suit after unsuccessfully trying, for almost a year, to resolve the matter 

· through conciliation, as required by 2 U.S.C. §437(g)(a) 

(5)(A). 

The defendant maintained that: 

-- Section 434(b) does not impose an affirmative duty on 

the candidate to obtain information which may not 

exist. Rather, the burden of proof is on the Commission, 

which must identify persons who contributed more than 

$100 and establish that, .at the time of the contr.ibution, 

they had an occupation and a principal place of business 

which they were required to report. 

-- One cannot be in violation of the law for failure to make 

best efforts; one can only be in violation for failure to 

report the required information. In the event that the 

required information does exist and is not reported, the 

defendant may be relieved of guilt if he is able to 

demonstrate that he attempted to obtain the required 

information and was unable to do so. 

-- The Commission _gave insufficient guidance as to how 

the Committee might o.btain the required information. 

In the absence of any regulation or guidelines, the 

Committee efforts were best efforts. 

The .Commission argued that: 

-- The Act clearly imposes the burden of obtaining the 

required information on the candidate. 

-- If the CF R had been able to demonstrat.e that they had 

made an attempt to obtain the required information and 

had not been successful, their effort would have been 

sufficient. The Committee's initial mailing to potential 

contributors did not request the required information, 

or state that the contributor was required to provide it. 

The only Committee mailing which pointedly requested . 

the missing information was sent in December 1977 (the 

relevant reporting period was 1975-76), after the Committee had received 14 requests for additional information from the Commission, and after the Committee was 

aware that the Commission had found reasonable cause 

to believe it was in violation of the Act. 

-- Lack of guidance did not hinder other Presidential 

committees from making satisfactory efforts to obtain 

the required information. Furthermore., the Commission 

did provide guidance to the Committee, pointing out'its 

reporting deficiencies, suggesting ways those deficiencies 

might be corrected, and discussing how other .Presidential committees were gathering the required information. 

In finding for the defendant, the ·eaurt concluded that the 

Commission "had a duty to give more ... detailed guidance 

by regulation." In the absence of such guidance, the efforts 

made by the Reagan Committee were best efforts. 

FEC PUBLISHES NAMES 

OF NONFILERS 

On March 31, 1979, the Federal Election Commission 

published the name of one Federal candidate in California's 

eleventh Congressional district who failed to file the 

required 10 day pre-election report of campaign finances 

for the· April 3 special general election. 

In another action, on April 6, 1979, the ·Commission 

published the names of 313 nonfilers who failed to file the 

required 1978 year-end campaign finance report, due 

January 31, l979. The year-end nonfilers included Federal 

candidates, their principal campaign committees, and other 

political committees from 44 States, the District of 

Columbia and the Virgin l~ands. 

Under Commission procedures, three notices are sent to 

candidates and committees reminding them of their reporting obligations and urging compliance. If a candidate or 

committee does not file the required report(s) following the 

receipt of these notices, the name of that "nonfiler" is 

made public, as required by law. In addition to publishing 

the names of nonfilers, the Commission has the authority 

to take further enforcement action under the statute, 

including civil court enforcement and imposition of civil 

fines. 

The RECORD is published by the Federal Election Commission, 1325 K Street, N.W., Washington, D.C. 20463. Com-

missioners are: Joan D. Aikens, Chairman; Robert 0. Tiernan, Vice Chairman;Max L. Friedersdorf; Thomas E. Harris; 

John W. McGarry; Vernon W. Thomson; J.S. Kimmitt, 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. 

2 
• AUDITS RELEASED 

TO THE PUBLIC 

The Federal Election Campaign Act requires the Com· 

mission to periodically make audits and field investigations 

with respect to reports and statements filed under the Act. 

The Commission is also required to conduct audits of all 

campaigns of Presidential candidates who receive public 

funds. Once an audit is completed and an audit report is 

approved by the Commission, the report is made public and 

is available in the Office of Public Records and the Press 

Office. The following is a chronological listing of audits 

released between March 3, 1979, and April 2, 1979. 

Audits 

1. Mclain Campaign Committee, AL/5 

2, Corman Campaign Committee/Corman 

Dinner Committee/Carman Congressional 

Keyman, Keywoman, CA/21 

Type of Committee Audited 

Presidential Candidate 

Public Financing (1976) 

Presidential Candidate 

No Public Financing (1976) 

Congressional Candidate 

Random (1976) 

State Party 

Congressional Party 

National Party 

Non-Party, Non-Candidate 

Referral Audits* 

Date Made 

Public 

Audits 

Required 

by Audit 

Policy 

19 

23 

106 

70 

9 

19 

51 

3. John R. Rarick Congressional Campaign 

Committee, IN/1 

4. Guffey in the First Committee, SD/1 3/7/79 

3/29/79 

3/29/79 

5. Rudasill for Congress Committee, NC/2 

6. West Virginia State Democratic Telethon 

Committee 

7. The Committee for Jimmy Carter 

(Primary Election) 

PROGRESS OF AUDITS 

4/2/79 

With this issue, the Record will begin publication of an 

audit summary chart. The chart provides cumulative 

information on the progress of FEC audits from 1976 

through the present. The chart includes data on the types 

of committees being audited, the status of those audits and 

the number of audits completed and available to the public. 

(For a full discussion of FEC audit policy, see the Record, 

January 1979, p. 5.) 

Field Internal Audits ComWork Field Review of pleted and Audits 

in Work Audit in Released to be 

Progress Completed Progress to Public Scheduled 

19 5 14 0 

13 10 3 10 

106 14 92 0 

2 68 48 20 0 

9 8 0 

2 4 4 0 13 

17 10 7 34 

6 6 2 

*Referral Audits include candidates and committees referred to the Audit Division by the Reports Analysis Division or the Office of 

General Counsel. 

3 
ANNUAL REPORT 

On March 31, 1979, the Commission submitted its 

Annual Report 1978 to the President and the Congress. 

This year's Report details the accomplishments ofthe FEC 

during 1978, the first election period which afforded the 

Commission an opportunity to monitor the financing of 

Federal election campaigns on a comprehensive basis. By 

1978, the Commission had prescribed a complete set of 

Regulations implementing the Act; issued many Advisory 

Opinions which provided guidance to candidates and 

committees on the application of the Act and Regulations 

to specific situations, and overhauled a number of Commission procedures and programs. Commission accomplishments during 1971il, Q.etailed in the Report, are highlighted 

below: 

1. Expanded info•01ation outreach programs facilitated 

voluntary compliance with the Act by helping candi· 

dates and committees register and fulfill reporting 

obligations of the Act. 

2. The refinement of computer capabilities and the establishment of a separate Reports Analysis Division helped 

to facilitate more timely, accurate disclosure of the 

information contained in reports filed by candidates and 

committees. During 1978, the Commission developed a 

series of comparative statistical studies on the campaign 

finance activities of Federal candidates and committees. 

These Reports on Financial Activity provided to the 

public, for the first time, campaign financing information before election day. 

3. Improved internal procedures expedited Commission 

handling of" compliance matters. 

In addition to detailing the procedures and programs 

the Commission developed during 1978, this year's Report 

also describes the planning process currently underway to 

administer the 1980 Presidential election cycle. 

Finally, in accordance with 2 U.S.C. §437e, which requires 

that the Commission's Annual Report contain " ... recommendations for such legislative or other action as the 

Commission considers appropriate," the Report includes 

the Commission's legislative proposals. The proposed 

revisions to the Act address apparent statutory omissions 

and specific problems the Commission has encountered in 

FORMS 

administration of the law. Categor'ized into seven majo

areas, the proposals include simplification and clarification

of the Act with respect to: reporting requirements; Pres

dential elections; contribution and expenditure limitation

and the role of the political party; the duties, powers an

authority of the Commission; corporate and union activitie

relating to Federal elections; several existing regulations an

several miscellaneous recommendations. 

The Annual Report 1978 is available from the Superinten

dent of Documents, U.S. Government Printing Offic

Washington, D.C. 20402; telephone 202/275-2091. Th

order number is 052-003.00651-1. Purchase price, payabl

to the Superintendent of Documents, is $3.00. 

FEC PUBLIC APPEARANCES 

In keeping with its objective of making iofermation available to the public, the Federal Election 

Commission regularly accepts invitations to address 

public gatherings on the subject of campaign finance 

laws and the Commission itself. This regular column 

lists scheduled Commission appearances, detailing the 

name of the sponsoring organization, the location of 

the event and the name of the Commission's speaker. 

For additional information on any scheduled appearance, please contact the sponsoring organization. 

5/22 National Association of Business PACs 

National Association of Manufacturers 

Cleveland, Ohio 

5/22 

5/24 

Jan Baran, Executive Assistant to 

Chairman Aikens 

International Institute of Municipal Clerks 

Bal Harbour, Florida 

Gary Greenhalgh, Clearinghouse Director 

League of Women Voters 

Seattle, Washington 

Chairman Joan Aikens 

Forms for candidates and committees to register and report are available at any time by contacting: Office of Public 

Communications, Federal Election Commission, 1325 K Street, N.W., Washington, D.C. 20463; or by calling, 

202/523-4068, toll-free 800/424-9530. 

Candidates and committees should use the revised form for reporting receipts and expenditures, which is designated in 

the upper left hand corner as: FEC Form 3 REVISED, January 1978. Candidates and committees may make and use 

photocopies of standard FEC forms. 

4 
With the approach of the 1980 Presidential primary and 

general elections, the Public Communications Office has 

received an increasing number of questions on public 

financing. In the March issue, the Record initiated a series 

of brief articles summarizing those sections of the Act 

and Regulations governing public financing. The article 

below, third in the planned series, explains what is a 

matchable campaign contribution, that is, a contribution 

eligible for public matching funds. {NOTE: Candidates and 

committees are cautioned not to rely on these summaries, 

but to consult the Act and Regulations for complete 

details.) 

MATCHABLE CAMPAIGN CONTRIBUTIONS 

A candidate who has successfully satisfied eligibility and 

certification agreements is entitled to receive public funds 

equal to the amount of each matchable campaign contribu· 

tion he or she receives. To be eligible for matching, the 

contribution must: 

1. Be a gift of money. 

Individuals may contribute up to $1,000 to a candidate; 

however, only the first $250 of an individual's contribu· 

tion{s) is eligible for matching funds. 

2. Be made by an individual. 

3. Be made by a written instrument. 

·~ritten instrument" means a check, a money order or 

any other negotiable instrument payable on demand. 

The written instrument must be made out to, or 

specifically endorsed without qualification to the 

candidate, or the candidate's authorized committee, and 

must identify the candidate by name. 

4. Identify the contributor by full name and mailing 

address. 

The. written instrument must include the full name, 

mailing address and signature of the contributor, and the 

amount and date of the contribution. In cases of money 

orders which do not include the signature of the contri· 

butor, an accompanying written document must contain 

the signature. If a check is drawn on a joint checking 

account, the person who signs the check is considered 

the contributor. For a contribution to be attributed 

equally to other tenants of the joint account, the other 

individual {s) must also sign the written instrument or an 

accompanying written document. 

5. Be made for the purpose of influencing a primary 

election. 

6. Be received after January 1, 1979. 

The contribution must be dated, physically received and 

deposited on or after January 1, 1979 {the first day of 

the calendar year immediately preceding the year of the 

Presidential election), but no later than December 31, 

1980 {the last day of the election year). In order to be 

matched, all contributions must be submitted to the 

Commission by January 21, 1981. 

5 

7. Be deposited in the designated campaign dep.,.itory. 

The contribution must be actually received by the 

candidate or a committee authorized by the candidate 

within the specified time frame, and deposited in a 

designated campaign depository maintained by the 

principal campaign committee. 

The following list identifies all FEC documents which 

appeared in the Federal Register between November 13, 

1978 and April 10, 1979. 

Notice Title 

Federal Register 

Publication Date Citation 

1979-1 Presidential Election 

Campaign Fund and 

PrimarY Matching Funds 

(Revised Regulations on 

Presidential Matching 

Funds) 

4/4/79 

1979·2 Presidential Election 4/13/79 

Campaign Fund and 

Primary Matching Funds; 

Correction 

CORRECTION 

44 FR20336 

44 FR 22407 

The limit for coordinated party expenditures in 

the special elections in Wisconsin and California 

was incorrect as it appeared in the April Record. The 

figure published in April was $13,320; the correct 

figure is $13,230. 
FEDERAL ELECTION COMMISSION 

1325 KSTREET, NW 

WASHINGTON, DC 20463 

OFFICIAL BUSINESS 

FIRST CLASS MAIL 

POSTAGE & FEES PAID 

FEC 

WASHINGTON, D.C. 

PERMIT NO. G-31