FEDERAL ELECTION COMMISSION 

WASHINGTON. D.C. 204W 

October 5, 2010 

MEMORANDUM 

TO: 

FROM: 

Patricia Carmona 

Chief Compliance Officer 

Joseph F. Stoltz 

Assistant Staff Director 

Christopher Hughey JD ^ 

Acting General Counsel' 

Lawrence L. Calvert, Jr;^^ 

Associate General Cou^irel| 

SUBJECT: 

Lorenzo Holloway 

Assistant General Counse! 

For Public Finance and Audit Advice 

Allison T. Steinle 

Attomey 

Proposed Audit Division Recommendation Memorandum on the Kansas 

Republican Party (LRA 801) 

I. INTRODUCTION 

The Office ofGeneral Counsel has reviewed the proposed Audit Division 

Recommendation Memorandum C'ADRM") and accompanying proposed Draft Final Audit 

Report ("DFAR") on the Kansas Republican Party ("the Committee"). We recommend that the 

Audit Division modify Finding 3 of the DFAR. We concur with any other documents and findings 

not specifically discussed in this memorandum. Ifyou have any questions, please contact Allison 

T. Steinle, the attomey assigned to this audit. 

H. RECOMMENDED MODIHCATION TO FINDING 3 

Finding 3 ofthe DFAR concludes that a $6,000 expenditure for a mailer that mentioned a 

federal candidate should have been paid with 100 percent federal funds because it was made for 

Federal Election Activity ("FEA"). At the time this Office drafted our legal comments on the 
Legal Analysis 

Proposed ADRM and DFAR 

Kansas Republican Party (LRA 801) 

Page 2 of2 

Interim Audit Report ("lAR") and the first proposed DFAR, our understanding was that the mailer 

was a public communication that promoted, supported, opposed, or attacked ("PASO-ed") a 

clearly identified candidate for federal office. See 2 U.S.C. § 431(20); 11 C.F.R. § 100.24. We 

have since been informed that the Committee has been unable to produce a printed copy of the 

mailer and that the auditors cannot confirm that the mailer PASO-ed a clearly identified candidate 

for federal office. Accordingly, we are recommending that the Audit Division remove the mailer 

from the category of "Paymeni and Disclosure of Non-Allocable Federal Election Activity" and 

place it under the category of "Payment and Disclosure of Printed Materials" on page 10 of the 

DFAR. The "Payment and Disclosure of Printed Materials" category specifically addresses 

expenditures for mailers for which the Committee was unable to produce a printed copy, and treats 

them as federal activity because the Committee has been unable to demonstrate their non-federal 

nature. 

Moving the $6,000 expenditure to this category technically requires the Committee to 

report the expenditure as federal activity on Line 21 of Form 3X rather than FEA on Line 30 of 

Form 3X, as it had been previously instructed to do. Because the Committee has already amended 

its reports to disclose the $6,000 expenditure as FEA and the amount at issue is small, however, we 

recommend that the Audit Division not require the Committee to further amend its reports to 

disclose the expenditure as federal activity. 

Finally, there is an additional point that the Audit Division should bring to the 

Commission's attention in the ADRM: the Committee is already aware of this modification and 

has been given an opportunity to respond. On September 10,2010, this Office contacted the Audit 

Division and informally suggested the proposed modification. The Audit Division stated that it 

agreed with the modification, and on September 27,2010, it sent an e-mail to the Committee's 

treasurer to inform him ofthe proposed modification and provide the Committee with an 

additional opportunity to respond in writing and request an audit hearing. See Attachment 1. The 

Committee has declined a hearing and stated that it agrees with the proposed modification to the 

DFAR. See id. 

Attachment: 

(1) E-mails between Steve Fitzgerald, Treasurer, Kansas Republican Party and Jim Miller, 

Auditor