FEC NOTES

Questions coming into the Commission from the
public often are of general interest, and will be high-
lighted in this section of The Record in future is-
sues. These particular Advisory Opinion Requests
are noteworthy:

AOR 1975-85—Senator Hubert Humphrey has
asked the FEC about the applica-
tion of honorarium limitations to
the acceptance of an award.

AOR 1975-86—The Republican National Com-
mittee asked the Commission to
clarify the extent of Commission
power to regulate “activities of
local political parties.”

AOR 1975-90—The chairman of the Fund for a
Representative Congress asked
for an opinion regarding the vari-
ous administrative expenses and
activities of multi-candidate com-
mittees.

AOR 1975-97—-The Udall '76 Committee asked
whether the value of the volun-
teered services of a well-known
entertainer must be treated as an
in-kind contribution and whether
the entertainer’s travel and sub-
sistence expenses are attributable
contributions.

Answers to Most Frequently Asked Questions

* The 1974 Amendments to the Federal Election
Campaign Act of 1971 no longer require the signa-
ture of a notary on any Statement of Organization
or Report of Receipts and Expenditures required
to be filed under the Act. The statements, how-
ever, must be signed by the treasurer in the case
of a committee document and by the candidate for
a candidate report.

Only one pre-election report (10-day) is now re-
quired instead of two as before. There is, how-
ever, now a post-election report due 30 days after
the election.

A candidate may serve as either chairman or treas-
urer of his own political committee.

Henshaw New Clerk

Pursuant to the provisions of the Legislative
Reorganization Act of 1946, as amended by PL
83-197, the Speaker of the House appointed Edmund
L. Henshaw, Jr. to act as and to exercise temporarily
the duties of the Clerk of the House of Representa-
tives, effective at the close of business on Nov. 15,
1975. Mr. Henshaw was previously Executive Direc-
tor of the Democratic National Congressional Com-
mittee.

AID

The Audit and Investigation Division (AID) was
established to assist the Commission in fulfilling its
statutory obligations under the Federal Election
Campaign Act of 1971, as amended in 1974.

In order to encourage voluntary compliance with
the Act, the AID staff conducts routine audits of the
campaign financial activity of candidates for Federal

oftice. AID is presently conducting preliminary
audits of 12 Presidential candidates to determine
whether they meet the threshold requirements of ell-
gibility for matching tunds.

AID also assists candidates and committees in
establishing record-keeping procedures in contorm-
ity with the Act. Members of the AID staff are, for
example, currently preparing a bookkeeping manual
for Federal candidates and political committees.

In addition, AID is responsible for investigating
complaints filed with the Commission, and for
achieving voluntary compliance whenever possible.

The 25 members of AID are experienced profes-
sional auditors and investigators. Many of them pre-
viously worked on the staffs of the prior Supervisory
Ofticers who were responsible for implementation
and administration of the 1971 Act; others were
formerly auditors or investigators for other govern-
ment departments or private firms.

Buckley v. Valeo

On Nov. 10, the U.S. Supreme Court heard oral
arguments in the case of James L. Buckley et al.,
Appellants v. Francis R. Valeo, et al., Appellees.
Arguing on behalf of the FEC was Ralph Spritzer,
with accompanying arguments from Daniel Fried-
man, Deputy Solicitor General; Archibald Cox, rep-
resenting Senators Hugh Scott and Edward Ken-
nedy; and Lloyd N. Cutler, representing Common
Cause, John M. Gardner, the League of Women
Voters, and the Center for Public Financing.

The suit—filed in appeal of the U.S. Court of Ap-
peals decision of Aug. 15—challenges the basic
provisions of the Federal Election Campaign Act as
being unconstitutional. In its decision, the Appeals
Court concluded that there is a “compelling govern-
ment interest, both as to need and public perception
of need, that justifies any incidental impact on First
Amendment freedoms” that results from the statu-
tory limitations.

The Supreme Court decision is anticipated before
the end of the year.

Special Deputy Named

Francis R. Valeo, who as Secretary of the Senate
is an Ex-Officio Member of the Commission, has
designated Harriet Robnett as Special Deputy to the
Secretary of the Senate for the FEC. Ms. Robnett
had previously served as Executive Assistant to the
Secretary. She will now represent him in a non-
voting capacity at all Commission meetings.

Code of Ethics

The FEC recently adopted a Code of Ethics for Its
Commissioners and employees to ensure “strict and
absolute fairness and impartiality in the administra-
tion of the law.” The document, which was based on
Codes of various other government agencies as well
as suggestions from the Commission and em-
ployees, is available for public examination.

New Task Force
The Commission has created a Task Force on
Data Processing and Computer Application to


CURRENT ADVISORY OPINIONS LISTED

This chart represents a listing and brief description of Advisory Opinions issued by the Commission from
mid-October through mid-November. Advisory Opinion Requests are designated a number as they are re-
ceived by the Commission. Advisory Opinions are not necessarily approved in sequential order. Reference fol-
lowing each description is the publication date and page number in the Federal Register. (For descriptions of
previously issued Advisory Opinions commencing with AO 1975-1, see The FEC Record, Vol. 1, No. 2.)

AO 1975-21—Sets forth an allocation formula to be used
in determining the portion of expenses that may be paid
from non-corporate sources and expenses that may be
paid from corporate funds in States where such contribu-
tions are permitted. (11/12/75- oe

AO 1975-26—Application of contribution limitations to
earmarked campaign funds deposited with Senatorial
campaign committees. (11/4/75-51351)

AO 1975-27—Attorney and accountant fees must be
charged against expenditure limits. Contains dissenting
opinion of two Commissioners. (11/4/75-51351)

AO 1975-28—Clarifies the status of political committees
supporting a former candidate for the Presidency.
(11/4/75-51352)

AO 1975-29—Applicability of contribution limitations to
county committees. (11/4/75-51352)

AO 1975-30—A principal campaign committee may make
expenditures to purchase newspaper subscriptions and to
reimburse the candidate for travel expenses. (11/4/75-
51353)

AO 1975-45—Application of contribution limitations to
multi-candidate committees.

AO 1975-47—Expenditures of corporate funds by host
committee to attract a national party convention. Supple-
ments AO 1975-1 and deals with the purposes for which
national conventions host committees may make expendi-
tures and the application of convention spending limita-
tions to such expenditures. (10/24/75-49883)

AO 1975-51—Use of excess campaign funds to purchase
Congressional office equipment. Use of computer termi-
nal to aid in handling of Congressman’s constituent mail.
(11/5/75-51611)

AO 1975-52—Extent to which a State committee may as-
sist a successful Federal candidate in retiring a 1974 elec-
tion campaign debt. (11/12/75- ) .

AO 1975-57—Contributions to repay loans made before
Jan. 1, 1975 which were received prior to issuance of the
Commission’s Interim Guidelines on retiring past debts.
(11/5/75-51611)

AO 1975-62—The portion of a donation which covers the
actual costs of a fundraising dinner must be counted as a
contribution. (11/12/75- )

AO 1975-64—A single fundraising function may be held to
retire a 1972 campaign debt and a 1973-74 office account
deficit. (11/12/75- )

AO 1975-67—Use of name of campaign cornmittee chair-
man ‘and treasurer is not required on billboard signs.
(11/12/75- )

AO 1975-74—A contribution made to a multi-candidate
committee in a non-election year is not counted against
the contributor’s $25,000 aggregate limit for the election
year. (11/4/75-51353)

AO 1975-77—Royalties from publication of a book are not
an honorarium. (11/4/75-51611)

AO 1975-78—The 20% fundraising exemption applies
broadly to fundraising costs, not just to the actual solici-
tation of contributions. (11/19/75-53722)

(Continued from p. 3)

State campaign committee. The reporting require-
ments of 2 U.S.C. §434(b) require the disclosure of
both the transfer and any refund.

AO 1975-74. Responding. to a request seeking an
interpretation of the second sentence of 18 U.S.C.
§608(b)(3), the Commission conciuded that an
unearmarked contribution made by a donor to the
Republican National Committee (or any other multi-
candidate political committee, as defined in §608(b)(3))
in a year other than an election year did not carry over
or carry back to the election year and therefore did not
have to be counted against the contributor’s $25,000
aggregate spending limit for the election year. The
Commission also concluded that a pre-election year
contribution by an individual donor to the primary of a

candidate must be counted against the donor’s $25,000
aggregate spending limitation in the election year,
whether the candidate wins or loses the primary.

AO 1975-77. The question was raised as to whether
royalties from the publication of a book would be
limited as an honorarium under the provisions of 18
U.S.C. §616.

The opinion states that the word “article” in 18
U.S.C. §616 should be read narrowly, and not be inter-
preted as meaning “any publication” because of the
principles of statutory construction and the express
legislative intent of Congress in enacting this section.
Thus, the Commission concluded that royalties from
the publication of a book by a Congressman would not
be affected by this provision.

GPO 896-637



survey and identify Commission data processing
needs and computer support requirements. The
Task Force will design systems for making Commis-
sion information available in more usable form as
well as to help the Commission to fulfill its statutory
responsibilities under the Act.

Public Communications
The Commission recently sent to its candidate

and committee mailing list a calendar of 1976 pre-
election and post-election filing deadlines for
Presidential, Senatorial, and Congressional primary
elections and the 1976 general election. The dead-
lines are listed by State and in chronological order.

The Commission notes that a few State legisla-
tures are considering changing the dates of their pri-
mary elections. A final list of reporting dates will be
published in early '76.

MATERIALS AVAILABLE

Federal Register Reprints

The FEC Record, Nos. 1 and 2

General Information Folder

Index of Reports and Statements

Chart of Reporting Dates by State and Election

(See FEC Notes, Public Communications)

Cost of Election Administration

© Survey of Absentee Registration and Voting
The FEC mailing list is currently being updated

and revised to include the large number of names

of persons who have requested information and

materials, and to incorporate mailing lists “of the

prior supervisory officers.” (See coupon on Page

3 for address corrections, changes, or reader

comment.)

Published by THE FEDERAL ELECTION COMMISSION, 1325 K Street, N.W., Washington, D.C. 20463.
Commissioners are: THOMAS B. CURTIS, Chairman; NEIL STAEBLER, Vice-Chairman; JOAN D. AIKENS; e
THOMAS E. HARRIS; VERNON W. THOMSON; 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. Press and Public Information
Phone No. - (202) 382-4733.

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

POSTAGE AND FEES PAID

OFFICIAL BUSINESS



1325 K Street N

Volume 1, No. 3

Washington, D.

THE FEDERAL ELECTION

COMMISSION

eCORD

0463

November 1975

COMMISSION PUBLISHES PROPOSED REGULATIONS
COMMENTS INVITED—HEARINGS SET

THE FEDERAL ELECTION COMMISSION IS WORKING STEADILY ON SEVERAL SETS OF REGULATIONS
INTERPRETING PROVISIONS OF THE FEDERAL ELECTION CAMPAIGN ACT. FOLLOWING ARE BRIEF SUM-
MARIES OF. SOME OF THE REGULATIONS AND A STATUS CHART.

ALLOCATION

The Federal Election Commission has published
preliminary proposed regulations on allocation of cam-
paign contributions and expenditures. “Allocation” is
the method used when an expenditure or a contribution
must be divided for purposes of attributing the proper
amount of money to the correct election, candidate, or
State, or in the costs of travel expenses when activities
include both campaign and non-campaign business.
Federal Register publication was Nov. 5, p. 51610.

The regulations consist of five sections, including
allocation of:

1. Expenditures between primary and general elec-

tions

2. Contributions between primary and general elec-

tions

3. Expenditures between two or more candidates

4. Expenditures among or between States by Presi-

dential primary candidates

5. Campaign and non-campaign related travel.

Subject to certain specific exceptions, the regula-
tions set up the general rule that attribution is to be
made to reflect the benefit received. Each part of a con-
tribution or expenditure is counted only once for at-
tribution purposes. What constitutes benefit received
is to be determined in the first instance by the candi-
date in a reasonable, consistent manner. The regula-
tions set forth no rigid formula and require no advance
justification by a candidate of attribution methods
used.

The Commission invites public review and comment
on the proposed regulations by Dec. 5. Public hearings
were conducted on Nov. 19 and 21 at the FEC. The
Commission will revise the regulation to reflect the
comments received and then forward the regulation to
Congress for the 30-legislative-day approval period.

PRESIDENTIAL PRIMARY MATCHING FUNDS

Public hearings on the Presidential primary match-
ing fund regulations were held by the FEC on Nov. 4
and 5 at Commission headquarters. The proposed reg-
ulations were published in the Federa/ Register on
Oct. 9, pp. 47688-47690.

The proposed regulations set forth the procedures
under which Presidential candidates qualify for and re-
ceive public funding for their campaigns, based on.a,.
matching formula.

The regulation contains three alternative proposals:
on the question of whether costs of fundraising events
must be deducted from the total contributions eligible
for primary matching funds. These proposals follow:

1. No costs of fundraising events deducted. Pro-

ceeds from the sale of items of intrinsic or endur-
ing value would not be matchable. (This, prov-
vision was put into effect on Oct. 9, as an interim
Guideline, pending promulgation of formal regu-
lations.)

. Subtract costs involved in fundraising concerts

. Subtract costs involved in any fundraising
“event, sale or other occurence which confers.a
private benefit upon the contributor.”

After the close of the public comment period, the
regulations will be revised to -reflect suggested
changes. Upon approval by the Commission, the regu-
lation will be sent to the Congress as required by law,
and will become effective if neither House disapproves
within 30 legislative days.

CONVENTION FINANCING

On Nov. 4, the FEC published in the Federal
Register the proposed regulations on public financing

(Continued, p. 2)

en



of the Presidential nominating conventions. An insert
to correct an omission was published on Nov. 14,
p. 53159. Public comments must be received by Dec. 4.
The Commission will schedule hearings during the
comment period for those wishing to present formal
testimony.

The 1974 Amendments to the Federal Election Cam-
paign Act provide public funds to finance the conven-
tions of both major and minor parties. Both major
national party committees have already submitted re-
quests for initial payments of their entitlements of $2
million each.

Anational committeé may spend up to $2 million for
its convention, évén if the committee does not accept
the public funds. The proposed réegulations apply the
$2 million ceiling to “qualified convention expenses,”
defined as those related to the convéntion, but not in-
cluding candidate or delegate expenses. Thus, party
committees are allowed to accept private contributions
to pay for candidate or delegate expenses. If a national
committee chooses to do this, it is required under the
proposed regulations to set up separate bank accounts
to prevent commingling of private and public funds.

. A Convention | Matching | Point of
REGULATIONS Disclosure | Allocation Financing Funds Entry Subpoenas| 4398 AO Regs
Federal Register
9/29/75 11/5/75 11/4/75 10/9/76 10/9/75
Publication
Close of Public
10/29/75 12/5/75 12/4/76 11/8/76 11/8/75
Comment
Hearings
11/21, 11/19, 41/4,
11/22, 11/21 11/5
11/24
Commission Meeting | Discussion: Discussion: Discussion:
. 11/18 11/20 11/20
For Discussion and/ Approval: Approval:
11/25 11/20
or Approval

SYNOPSES OF RECENT ADVISORY OPINIONS

These Advisory Opinion synopses are offered for
informative purposes only. Any interested party is ad-
vised to read the complete text of the opinion pub-
lished in the Federal Register, or to write to the Com-
mission for a copy.

AO 1975-21. The Republican Central Committee of
San Diego County asked the Commission whether cor-
porate contributions, permitted under California State
law, could be used to pay administrative expenses and
costs of a Republican registration drive. The Commit-
tee contributes to and makes expenditures on behalf of
Federal, State and local candidates.

The opinion permits the use of such corporate funds
for administrative expenses and registration drives di-
rected at State and local candidates, but sets forth an
allocation formula to be used in determining the por-
tion of the expenses that must be paid from non-
corporate (unrestricted) sources and the portion that
could be paid from corporate (restricted) funds. The al-
locable ‘Federal portion” is determined by the ratio of
(1) the total amount which the Committee directly con-
tributes to and expends on behalf of Federal
candidates to (2) the total of all direct contributions to
and expenditures on behalf of all candidates — Fed-
eral, State and local. The allocation is made on the an-
nual report filed with the Commission.

AO 1975-26. This opinion permits the transfer of
leftover, earmarked funds from the 1972 Senatorial
campaign to the-National Republican Senatorial Com-
mittee (NRSC) with the stipulation that the funds be
held by NRSC for the use of the 1976 Republican Sena-
torial candidate from Delaware. In addition, AO 1975-26
also states that the NRSC may contribute additional
sums to the 1976 Republican Senatorial candidate from
Delaware subject to applicable limitations in 18 U.S.C.
§608(b).

AO 1975-27. This concludes that attorney and ac-
countant fees must be charged against the expenditure
limitations. The Commission recognized, however,
that fees for accounting or legal services rendered in
connection with preparing for or responding to formal
compliance proceedings instituted against the candi-
date or committee, would not be counted against the
applicable spending limit.

In a dissenting opinion, two of the Commissioners
expressed the view that “expenditures for accounting
and attorney fees which are made to assure adherence
to the mandates of this complex new law at every stage
of a campaign for Federal office have an equal claim for
an exemption from the expenditure limits of the Act,
and should not merely be limited to the later point of
defending against formal complaints.”



In Statements from the Republican and Democratic
Senatorial Campaign Committees, the point was made

t ) that “the difficulties of compliance are  Particularty
acute for non-incumbent challengers. .

AO 1975-28. This Advisory Opinion permits a po-
litical committee to cease to exist once all debts and
obligations are extinguished. Further, a committee
established to support a Presidential candidate may,
by amending their registration statement, support that
candidate for another office.

AO 1975-28. The Commission was asked to define
the maximum amount a county central committee of a
political party (an official subordinate organ of a State
political party organization) may contribute to a candi-
date for the U.S. House of Representatives in the pri-
mary and general elections. A county central commit-
tee may contribute $1,000 or $5,000 (if it qualifies
i under §608(b)(2)) to a candidate for Federal office in
i each election (primary and general). The Commission
‘ pointed out, however, that if the State political party
{ organization exercises any direction or control over any
H contribution by the county central committee, then
i that contribution will count as a contribution by the
| State committee.

Contributions by a State or county central
| committee are, of course, separate from any expendi-
tures allowed under the party provisions.

AO 1975-30. Congressman David R. Bowen asked
for an Advisory Opinion as to whether a principal cam-
paign committee may purchase newspaper subscrip-
i tions and reimburse a Congressman for travel ex-

rT ) penses in connection with his political appearances.
| The opinion states that the Act in no way limits the
: right of a candidate to make his own determination as
: to what expenditures should be made by his campaign,
| and any expenditure which a candidate or his principal
campaign committee report as made for purposes of
influencing a Federal election will be treated accord-
' ingly and counted toward the appropriate limitations.
Thus, expenditures may be made by a candidate or-his
principal campaign committee to purchase newspaper
subscriptions, to reimburse a Congressman, and for

© Are your name and address correct on the mailing label?

any other purpose intended to influence a Federal
election.

AO 1975-45. The Commission decided that, while a
national multi-candidate committee could establish
subsidiary State committees which have the same
treasurer and members and which are dependent on it
for funds, all such subsidiary committees together
could make only one $5,000 contribution to any candi-
date.

AO 1975-57. This opinion states that contributions
to repay loans made before Jan. 1, 1975, do not have to
state in writing that they are to be used for that purpose
if they were made before the Commission issued its
Interim Guideline on Aug. 5, 1975.

AO 1975-59. This opinion allows the Rhode Island
Republican Central Committee to accept corporate
contributions, permitted under State law, in connec-
tion with a fundraising event and deposit such contri-
butions in a separate bank account to be used only for
State candidates.

AO 1975-62. This opinion concludes that the por-
tion of a donation which covers the actual costs of a
fundraising dinner must be reported as a contribution
and charged against the contribution limits.

AO 1975-64. This opinion permitted a candidate to
hold a single fundraiser to retire both a 1972 campaign
deficit and a 1973-74 office account deficit, provided
the solicitation for the fundraiser clearly indicates the
purpose, and contributions and expenditures to retire
the deficit are made prior to Jan. 1, 1975, conform to
the Commission's Interim Guideline issued Aug. 5,
1975 (40 FR 32950).

AO 1975-66. The Commission ruled that a transfer
from a State campaign committee to a Federal cam-
paign committee was permissible so long as the funds
transferred were not from prohibited sources under
18 U.S.C. §§608, 610, 611, and 613. Any prohibited
funds that were transferred must be returned to the

(Continued p. 4)

DEAR READER: PLEASE CLIP THIS COUPON AND RETURN IT TO US COMPLETED
WITH YOUR COMMENTS. THANK YOU.

© If not, please provide correct address by making appropriate change on reverse side.

Please submit any general comments below, I.e., is The FEC Record useful to you? Do you have suggestions for changes in con-
tent? Additions to content? What do you like, what don’t you like?

Thank you for your cooperation.