INDEPENDENT EXPENDITURES
POLICY STATEMENT

The FEC has unanimously adopted a “Policy State-
ment” on the subject of “independent expenditures” under
the 1976 Amendments to the Federal campaign finance
law.

Under the new election law, no person may contribute
more than $5,000 per calendar year to a political commit-
tee making independent expenditures on behalf of Federal
candidates, the FEC said.

There is no limit in the law to the making of indepen-
dent expenditures, so long as they are made without any
cooperation or connection with a candidate or agent of the
candidate.

Highlights of the Policy Statement follow:

“The Commission's proposed regulations pro-
vide that a person may contribute $1,000 to a
candidate, and also contribute to a political
committee which has supported, or anticipates
supporting that candidate without violating the
$1,000 per election limitation, as long as the
contributor does not give to the committee
with the knowledge that a substantial portion
of the contributor’s funds will be contributed
by the committee to that candidate.

“However, it is the view of the Commission
that contributions made to a political commit-
tee, including those committees making inde-
Pendent expenditures on behalf of a clearly
identified candidate, are limited to $5,000
per calendar year to each political commit-
tee ...and, for individuals, are limited to a
total of $25,000 per calendar year. . .

“Contributions ... are made for the purpose
of influencing a Federal election. That the con-
tribution is made to a committee making inde-
Pendent expenditures does not change this
definition, Therefore, the $5,000 and $25,000
contribution limitations apply to contributions
made to committees making independent
expenditures.

"... This policy is set out in proposed regula-
tions published in the Federal Register on
May 26, 1976... This policy statement is ...
for guidance to candidates and committees
pending final promulgation of the regulations.””

COMPUTER SYSTEM AT FEC

The FEC has implemented a computer system to assist
the Commission:

© in the disclosure of campaign finance information;

© in managing the flow of documents and information
in a timely and orderly fashion;

0. in reviewing statements and reports; and

0 in compiling data necessary to formulate policy and
to obtain compliance with the Act.

Specifically, the system will include the following:

1, the filing status of Federal candidates;

2. an index of reports and statements filed;

3. cross indices which shall be prepared cumulatively
and published in the Federal Register, as required
by law;

4. the financial status of candidates’ campaigns;

5. the financial activities of all committees and inde-
pendent agents not directly connected with a can-
didate;

6. itemized contributions by individual contributors;

7. fund transfers not reconcilable; and

8. statistical information regarding campaign financial
activities and disclosures.

During 1976, an estimated 100,000 campaign finance
disclosure statements will be filed with the FEC by 2,500
Federal candidates and 7,500 political committees. These
documents will be initially reviewed by the FEC for com-
Pleteness and accuracy. The reviewers will then use 10
video-display keyboard terminals to transmit the data by
high-speed telecommunications to the FEC’s leased control
computer.

Computer Reports

The following reports, regularly updated, will be avail-

able from the computer system:

. Candidate Index

. Committee Index

. Index of Disclosure Documents by Committee

. Index of Candidates Supported by Committee

. Index of Supporting Documents by Candidate

. Index of Candidates and Committees

. Index of Itemized Contributions by Contributor
. Fund Transfers Not Reconcilable

These reports will be issued periodically for all candi-
dates and committees. They will be printed on a high-speed
Printer located at the FEC. Immediate access to the com-
puter information will be available on a selective basis by
use of two “interactive inquiry terminals” located in the
Public Records Section of the FEC,

The computer reports will be used by the Commission in
monitoring compliance with filing obligations, contribution
limitations and other requirements of the Act. The FEC
will also utilize the computer system to assist with standard
audit and investigative procedures.

sereoagge

CLEARINGHOUSE

The Advisory Panel to the FEC Clearinghouse on
Election Administration met in San Francisco June 8, 9,
and 10. The purpose of the meeting was threefold: To
observe the California primary election process in Contra
Costa and Alameda Counties; to review Clearinghouse and
Commission activities of the past six months; and to discuss
the role of election administrators in the political process.

In addition to Commissioner Neil Staebler, speakers at
the meeting included Richard Scammon of the Election

GPO 906-256



+ a —— — —
FEC NOTES
STATE SPENDING LIMITS VAP 1976 PARTY
(in thousands) SPENDING LIMIT
The Commission has compiled a 50-State chart of the
special spending limits for political parties on behalf of
their candidates in the general election (2 U.S.C. 441a(q)). Delaware* 395 21,820.00
These special party general election expenditures are not District of Columbia* 515 21,820.00
contributions to the candidate, and are separate from the Florida 6,020 131,356.40
expenditures of the candidate or the candidate’s authorized Georgia 3,294 71,875.08
committees. Hawaii 583 21,820.00
National political party committees are entitled to Idaho 542 21,820.00
separate limits for Presidential, Senate, and House general Illinois 7,654 167,010.28
elections. Indiana 3,601 78,573.82
State political parties are entitled to separate limits for Towa 1,977 43,138.14
Senate and House general elections, but may not make Kansas 1,592 34,737.44
separate expenditures in the Presidential general election. Kentucky 2,316 50,542.12
Within a State, committees subordinate to a State party Louisiana 2475 54,004.50
committee (county, city, local, and so on) are included Maine 724 21,820.00
within the State party limit. Maryland 2812 61,357.84
The formula for the party spending limits in the 1976. Massachusetts 4,097 89,396.54
general election is as follows: Michigan 6,145, 134,083.90
Minnesota 2,664 58,128.48
Presidential races = National Voter Age Population Mississippi 1,519 33,144.58
(VAP) x $0.02, plus the latest Missouri 3,323 72,507.86
cost-of-living increase Montana 503 21,820.00
Senatorial races = State VAP x $0.02, plus the latest Nebraska 1,065 23,238.20
cost-of-living increase, or $21,820, Nevada* 402 21,820.00
whichever is greater New Hampshire 559 21,820.00
Congressional races = $10,910 (except in the case of a New Jersey 5,102 111,325.64
candidate for election as Represen- New Mexico 736 21,820.00
tative from a State which is entitled New York 12,781 278,881.42
to only one Representative, the North Carolina 3,736 81,519.52
Senate party spending limits are North Dakota* 428 21,820.00
applicable, as in the case of States Ohio 7,357 160,529.74
with asterisk) Oklahoma 1,896 41,370.72
Oregon 1,606 35,402.92
Following is the breakdown by States: Pennsylvania 8,363 182,480.66
Rhode Island 653 21,820.00
vaP 1976 PARTY South Carolina 1,874 40,890.68
(in thousands) SPENDING LIMIT South Dakota 463 21,820.00
Tennessee 2,895 63,168.90
NATIONAL 146,828 $3,203,786.96 Texas 8,225 179,469.50
Utah 755 21,820.00
STATE Vermont* 320 21,820.00
Virginia 3,429 74,820.78
Alabama 2,439 $53,218.98 Washington 2460 53,677.20
Alaska* 219 21,820.00 West Virginia 1,255 27,384.10
Arizona 1,482 32,337.24 Wisconsin 3,134 68,383.88
Arkansas 1,449 31,617.18 Wyoming* 253 21,820.00
California 14,840 323,808.80 Puerto Rico 1,751 38,206.82
Colorado 1,732 37,792.24 Guam Si 10,910.00
Connecticut 2,172 47,393.04 Virgin Islands 57 10,910.00


Research Center, Dr. Warren Miller of the Michigan
Institute for Social Research, and Randy Hamilton, Past
President of the American Society for Public Administra-
tion.

James Olson, County Clerk of Contra Costa County,
conducted a tour of the county’s facilities and optical
scanning equipment. James. Riggs, County Registrar of
Alameda County, discussed and demonstrated the county's
newly adopted computerized voting system.

MATCHING FUNDS

The FEC certified $1,020,137.18 on June 17 in Federal
primary matching funds for seven Presidential candidates,
and $1,317,600.00 in Presidential nominating convention
payments to the Democratic and Republican National
Committees.

This raises to $18,719,219.56 the total amount of

+ primary matching funds certified this year by the FEC
for 15 Presidential candidates, and to $3,927,600.00 the
total for the two major political party conventions.

PUBLICATIONS

THE FOLLOWING MATERIALS ARE AVAILABLE
FROM THE FEC:

o The FEC Annual Report for 1975 was published in
March of this year. Anyone who did not receive a copy at
the time of its distribution may contact the FEC to obtain
one.

o A Campaign Guide, summarizing the basic changes
made by the 1976 Amendments.

o Special Text of The Federal Election Campaign Act
Amendments of 1976, showing old and revised language
of Title 2 of the amended Act.

0 Public Law 94-283 (The FECAA of 1976)
o FEC Draft Regulations published in the Federal
Register, Wed., May 26, Vol. 41, No, 103.
The FEC Record, Vol. 1, Nos. 1-4, Vol. 2, Nos. 1-5
The FEC Record, Special 1975 Year-End Supplement
The FEC Record, 1976 First-Quarter Index
Index of Reports and Statements
1976 Calendar of Pre- and Post-Election Filing Dead-
lines (for Presidential, Senatorial, and Congressional Elec-
tions) :
PUBLICATIONS OF THE NATIONAL CLEARINGHOUSE
ON ELECTION ADMINISTRATION ARE AVAILABLE
FROM:*
National Technical Information Service
5285 Port Royal Road
Springfield, Virginia 22161
Publications are:
o Election Law Survey (covers Jan. 1, '75-Dec. 1, '75)
Report No: PB 252219AS.
Price: $11.75 (446 pages)
0 Campaign Finance Survey (Summaries)
Report No: PB 252233AS
Price: $9.00 (264 pages)
0 Campaign Finance Survey (Charts)
Report No: PB 252239AS.
Price: $5.00 (90 pages)
o The Cost of Elections Report may be ordered
through the following:
U.S. Government Printing Office
Supt. of Documents
Washington, D.C. 20402
Price: $.65 (15 pages) .
Each of the above Clearinghouse réports is available on
microfiche for $2.25.

°

e000

*Available free of charge to elected government officials; others
Please mail remittance with order.

FEDERAL ELECTION COMMISSION
1325 K STREET, NW
WASHINGTON, DC 20463

OFFICIAL BUSINESS

POSTAGE AND FEES PAID %

—
U.S.MAIL
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r)

Vol. 2, No. 6

PROCEDURAL CHANGES AT ELECTION COMMISSION

following:

THE FEDERAL ELECTION
COMMISSION

RleCOIMRID

Street N

Washington, D.C. 20463

June 28, 1976

Because of the enactment of The Federal Election Campaign Act Amendments of 1976, a number of
procedural changes will be put into effect by the Commission, based on the Act (FECA) and FEC
regulations to be approved by the Congress. The following are summaries of FEC procedures in three
areas: 1) Advisory Opinions; 2) Compliance Procedures; and 3) Procedures for Enforcement of
Reporting Requirements.

ADVISORY OPINIONS

(public financing), or in regulations promulgated
by the FEC. Opinions cannot be issued for hypo-
thetical questions.

Requests must be in writing and must include all
facts relevant to the specific factual situation in-
volved.

Requests may be sent to the FEC, Office of
General Counsel, Advisory Opinion Section, 1325
K Street, N.W., Washington, D.C. 24063.

Requests will be made public at the Commission
for inspection, purchase, and written comment.

Advisory Opinions may be requested by the

1. holders of Federal office;

2. candidates for Federal office;

3. political committees;

4. national committee of a political party; or

5. authorized agents of any of the foregoing
persons if the agent discloses the identity of
his or her principal.

Advisory Opinions may only be issued concern-

ing the application of a general rule of law to a
specific factual situation involving the requestor. A
“general rule of law’ is stated either in Title 2,
U.S.C. (disclosure limitations), or Title 26, U.S.C.

Within a reasonable time after receiving a
request and comments, the Commission will issue a
written Advisory Opinion which will be sent to the
requesting party and made public.

(cont., p.2)

CANDIDATES AND COMMITTEES -- TAKE NOTE

The filing deadline is July 10 for the 1976 Second Quarter Report of Receipts and Expenditures, required of Federal
candidates and political committees spending or receiving more than $1,000 during the quarter.

Reports must be received in the appropriate office, either hand-delivered or by regular mail, by July 10. However,
reports sent by registered or certified mail need only be postmarked by midnight July 10 to be considered a timely
filing. The report covers all financial activity from April 1, 1976 through the close of books on June 30, 1976.

WHERE TO FILE: Candidates for the U.S. Senate and committees supporting only Senate candidates file with the
Secretary of the Senate (as custodian for the Federal Election Commission). Candidates for the U.S. House of Repre-
sentatives and committees supporting only House candidates file with the Clerk of the House of Representatives (as
custodian for the Federal Election Commission). All others file with the Federal Election Commission.

THE NEXT QUARTERLY REPORT FILING DEADLINE AFTER JULY 10 IS OCTOBER 10, COVERING JULY,
AUGUST, AND SEPTEMBER.

Requests for forms, and any questions regarding the report, should be directed to the FEC, 1325 K Street, N.W.,
Washington, D.C. 20463, or by calling toll-free 800/424-9530.



Advisory Opinions issued by the Commission
may be relied upon by:
1. any person involved in the specific transaction
dealt with in the request; or
2. any person involved in a specific transaction
indistinguishable from the transaction related
to in the request;
if, in either case, such persons act in good faith and
in accordance with the provisions and findings of
the Advisory Opinion.

COMPLIANCE PROCEDURES

The 1976 Amendments spell out new specific
steps for the FEC to follow in its compliance
procedures, as follows:

1. Initial Information. Any person may file a
complaint of a violation. Complaints must be in
writing, signed, and sworn to by the person filing
the complaint, notarized, include the complaining
person's name, address, and telephone number, and
include a clear and concise statement of the Act
constituting the alleged violation and any avail-
able documentation.

The Commission may initiate compliance
procedures on its own on the basis of information
ascertained in the normal course of carrying out its
supervisory responsibilities.

2. Initial Review. After receiving a complaint,
or initiating compliance procedures on its own
through its supervisory responsibilities, the Com-
mission must determine whether there is “reason
to believe” that a violation has occurred. It must
make public any determination at this point that
no violation has occurred.

3. Investigation. \f the Commission determines
that there is “reason to believe” a violation has
been committed, it shall notify the person com-
plained against, conduct an investigation, and
afford such person a reasonable opportunity to
demonstrate that no action should be taken by
the Commission.

4. Secondary. Review. After investigation, the
Commission must determine whether there is
“reasonable cause to believe” that a violation has

been committed. It must make public any deter-
mination at this point that no violation has occur-
red.

5. Conciliation. \f the Commission determines
that there is “reasonable cause to believe” a
violation has been committed, the Commission, for
a minimum period of 30 days, must seek to correct
the matter through “informal methods of con-
ference, conciliation, and persuasion,” and to enter
into a conciliation agreement. All attempts to
secure conciliation, and all conciliation agreements,
will be made available to the public.

6. Civil Enforcement. The Commission has
exclusive primary jurisdiction with respect to civil
enforcement of the FECA. If a conciliation agree-
ment is not reached, and if the Commission deter-
mines there is “probable cause’ to believe a
violation has occurred, it may institute civil actions
for relief, including temporary or permanent
injunctions, restraining orders, or other appropriate
orders. The Commission also has the power to seek
civil court enforcement of court orders and of
conciliation agreements.

7. Criminal Prosecution. \n addition to civil
enforcement of the entire FECA, the Commission
has the authority to refer certain serious offenses
to the Department of Justice for criminal prosecu-
tion. These are “knowing and willful’ violations
involving the making, receiving, or reporting of any
contribution or expenditure having a value in the
aggregate of $1,000 or more, or t.aving a lesser
value in the case of certain sections.

PROCEDURE FOR ENFORCEMENT
OF REPORTING REQUIREMENTS

In a “Memorandum of Understanding” adopted
by the Commission, procedures are set forth to be
used to correct violations of reporting require-
ments, such as non-filing, late filing, partial filing,
and clerical errors or surface violations which on
the face of the report appear to be clerical errors.

General procedural steps to be followed are:

1. Informational Letter. An initial letter will be
sent by the Commission on any matter involving a
partial filing, garbled filing, or surface violation.

e



The letter will be sent to the respondent setting
forth a time period in which an answer is request-
ed.

2. “Reason to Believe’ Letter. \f the respon-
dent fails to answer the first letter, or if the res-
ponse to that letter is inadequate, a second letter
will be sent. This letter will state that the Commis-
sion has ‘‘reason to believe’ that the respondent
has committed a violation of the Act, and will
invite the respondent to demonstrate why no
action should be taken by the Commission against
him under the Act.

In the case of a on-filing, the “reason to
believe” letter will be the first letter sent.

3. “Reasonable Cause to Believe” Letter. \f the
respondent fails to answer the second letter (or the
initial non-filing letter), or if the response in either
case is inadequate, a subsequent letter will be sent.

This letter will state that the Commission has
determined that there is reasonable cause to believe
that the respondent has violated the Federal
campaign act, as amended, and that the Commis-
sion will take any appropriate steps it considers
necessary if the response is again not satisfactory.

4.1f no response or an inadequate response is

received to the ‘reasonable cause to believe” letter

- in cases of partial filers, garbled filers, or
surface violations --

then the Commission will refer the letter to the

General Counsel’s office for appropriate handling.

The General Counsel's office will report back to
the Commission within 30 days as to the disposi-
tion of such referred matters;

- in cases of non-filers --
the Commission may publish a list of the names
and addresses of such non-filers at the recommen-
dation of the Office of General Counsel.

Upon such publication, notice of such publica-
tion will be sent to the non-filer by certified mail,
with a letter from the General Counsel stating that
appropriate action may be instituted if a reply is
not received within five calendar days of receipt of
such correspondence.

If a report is not filed within eight calendar days
of the correspondence from the General Counsel’s
office, that office will make a recommendation to
the Commission as to whether or not appropriate
civil enforcement should be sought.

5. Non-Filing Prior to Elections. \f either the
10-day pre-election report, or the report required
to be filed for the calendar quarter immediately
before the date of the general election, is not filed
within 24 hours of the due date, the Commission
will immediately send the “reason to believe”
notice by te/egram.

If no response or an inadequate response is
received within 48 hours of the time the telegram
is sent, a second telegram will be sent stating that
if the required report is not received within 48
hours of receipt of that telegram the matter will be
referred to the General Counsel for appropriate
civil sanction.

Published by THE FEDERAL ELECTION COMMISSION, 1325 K Street, N.W., Washington, D.C. 20463. Commissioners
are: VERNON W. THOMSON, Chairman; THOMAS E. HARRIS, Vice Chairman; JOAN D. AIKENS; WILLIAM L.
SPRINGER; NEIL STAEBLER; ROBERT O. TIERNAN; FRANCIS R. VALEO, Secretary of the Senate, Ex Officio;
EDMUND L. HENSHAW, JR., Clerk of the House of Representatives, Ex Officio.

Staff Director - Orlando B. Potter; General Counsel -- John G. Murphy, Jr.; Asst. Staff Director for Administration -
Robert Baker; Asst. Staff Director for Disclosure and Compliance -- Drew McKay; Asst. Staff Director for Information

Services - Herb Koster; Editor ~ Carolyn L, Tillotson.

New Toll-Free Number: 800-424-9530. Press Information Phone No. - (202) 382-4112. Public Communications ~

(202) 382-4733. The Record - (202) 382-6644.