•

July 1993

Table of Co ten

Regulations

Changes toEnforcement

Regulations

Motor Voter

Chairman 's Letter to Governors

Compliance

2 M R3528: Amending Reports 10

Disclose Prev iously Missing

Contributor Information

2 MURs Released to the Public

Conferences

3 FEC 10 Hold Conferences in San

Francisco and Washington, DC

Publica tions

3 FEC's 1992 Annual Report Now

Available

Clea ringhouse

3 Updated Editionof Election Case

Law Released

Statistics

4 PAC Contributions Increase

19 Percent

6 Advisory Opinions

7 Ind ex

Reports

8 Reminder: Midyear Report Due

July 31

Federal Election Commission

Regulations

Comments Sought on Changes

to Enforcement Regulations

The Commission is seeking public

comment on proposed changes to its

enforcement regulations, 11 CFR Part

I ll . (Enforcement cases are called

Matters Under Review or MURs.)

The draft rules would revise or clarify

almost every aspect of the enforcement process, from the initial filing of

a complaint to the payment of

penalties. The rulemaking also asks

readers to comment on proposed new

procedures, such as agency hearings

at which respondents or their counsel

could testify.

Comments must be in writing and

are due September 24. 'Those submitting comments may also request to

appear at a public hearing scheduled

for October 20. Written comments

and requests to testify should be

addressed to Susan E. Propper.

Assistant General Counsel, 999 E

Street. NW, Washington, DC 20463 .

The Notice of Proposed Rulemaking published in the Federal

Register is available for review at the

FEC's Public Records Office. Copies

may be ordered at a cost of 5¢ per

page. Call 800/424-9530 (ask for

Public Records) or 20212 I9-4140 . ..

Volume 19. Num

Motor Voter

FEC Chairman's Letter

to Governors Promises He

with Motor Voter Law

In a May 2 1 letter, FEC Chai

Scott E. Thomas assured state g

nors that the Commission would 

with state officials to help them

implement the National Voter R

tration Act of 1993, which was 

by President Clinton on May 20

Chairman Thomas announce

formation of an ad hoc discussio

group to clarify issues and ident

, options for implementing the la

group is composed of State and 

election officials and representa

from interest groups and agenci

affected by the new legislation. 

its first meeting on June 25-26.

In 1995. when the motor vote

becomes effective, states will ha

• Permit individuals to register t

at the same time they obtain or

renew their drivers license;

• Designate public assistance ag

and certain other offices as vot

registration agencies;

• Permit voter registration by m

(national mail-in form to be de

signed by the FEC); and

• Limit purges of voter lists.

(continued Oil p
Federal Election Commission RECORD

Motor Voter

(continuedfrom page /)

In closing, the Chairman reassured

the governors "that the Commission

recognizes the legislative, financial

and technical constraints under which

your State must implement the

provisions of the Act, and that we

take seriously our responsibility to

provide your State officials with the

[necessaryJinformation and assistance...."

The June meeting of the ad hoc

group was organized by the FEe's

National Clearinghouse on Election

Administration. The Clearinghouse

plans to publish a detailed summary

of the law and a practical guide for

implementing it. Later this year, the

office plans to hold conferences with

state officials. +

Federal Election Commission

999 E Street. NW

Washington, DC20463

800/424-9530

2CPJ2 19-3420

2= 19-3336 (TOO)

Scott F_ Thomas, Chairman

Trevor Potter, Vice Chairman

Joan D, Aikens, Commissioner

Lee Ann Elliott,Commissioner

Danny L. McDonald,

Commissioner

John Warren McGarry,

Commissioner

Walter J. Stewart, Secretary

of theSenate. ExOfficio

Commissioner

Donnald K, Anderson, Clerk

of the House of Representatives,

Ex OfficioCommissioner

John C. Surtne, StaffDirector

Lawrence M. Noble, General

Counsel

Published by the Information

Division

Louise D. Wides, Director

StephanieFitzgef".l.ld. Editor

Blake Lange,GraphicsAdvisor

2

Compliance

MUR3528

Amending Reports to Disclose

Previously Missing

Contributor Information

In MUR 3528. the Commission

clearly stat ed that if a committee

receives missing contributor information for a previously reported contribution, it must disclose the new

information in an amended report.

To comply with the law, committees must use "best efforts" to "obtain,

maintain. and submit" all required

reporting information [emphasis

added]. 2 U.S.C §432(i); II CFR

104.7(, ).

With respect to contributions from

individuals, committees are required

to report the name, address. occupation and employer of each donor

whose aggregate contributions exceed

$200 in a calendar year. 2 U.s.c.

§§43 1(I 3)(A) and 434(b)(3)(A). To

satisfy the "best efforts" standard for

obtaining this information. committees must make at least one clear

request, persolicitation. The request

must state that the reporting of the

information is required by law.

II CFR 104.7(b).'

In MUR 3528, a campaign comminceused best efforts to "obtain and

maintain" required information, but

failed to "submit" it in amended

reports.

The committee filed two consecutive reports lacking occupation and

employee Informationfor several

contributors. Subsequently. the

committee wassuccessful inobtaining the missing information from 38

contributors whose contributions

I The Commission has proposed revisions

to us "best efforts" regulations at

11CFR 104.7(b). See 57FR 44137.

September 24, /992. See also the

following Record issues: November /992

(page I ): May /993 (page I): and Julie

/993 (page3).

July 1

totaled $28,475, but it did not ame

the reports until after the Commiss

found reason to believe that the

committee had violated the reporti

provisions. The committee mistake

believed it had satisfied the "best

efforts" requirement by obtaining a

maintaining the information. The

Commission said that the statute

required the information to be

"submitted" as well.

The commiuee agreed to pay a

$2,000 civil penalty. •

MURs Released to the Publi

Listed below arc FEC enforcem

cases (Matters Under Review or

MURs) recently released for public

review. The list is based on the FE

press release of May 24, 1993. File

on closed MURs are available for

review in the Public Records Offic

M UR 3234

Respondents: New York State

Conservative Party, Michael R. Lo

chairman

Complainant: Moynihan for Sena

Committee

Subj ect: Acceptance and use of

prohibited funds; failure to register

and report on time; disclaimer

Disposition: $30,000 civil penalty

MUR3618

Respondents: TGI Friday's Incorp

rated Employees Political Action

Committee, Daniel Thompson Cro

treasurer (T X )

Complainant: FEC initiated

Subject : Failure to file reports on

time

Disposition : $4,225 civil penalty .
•

•

•

}U!Y 1993

Conferences

FEC to Hold Conferences

in San Francisco and

Washington, DC

FEe conferences offer basic and

advanced workshops on the federal

campaign finance law and provide the

opportunity to discuss problems and

questions with FEC Com missioners

and staff. The agency will hold two

conferencesthis year: 1

• A San Francisco regional conference, September 30 - October 1, for

candidate committees, party committees, and corporate and labor

PACs and their connected organizations. (More information given

below.)

• A November conference in Washington. DC. for corporations, trade

associations, labor organizations and

their PACs. (Date not yet available;

details to appear in future issue.)

To place your name on a mailing

list to receive registration materials

for either conference, call 800/424-

9530 or 202/21 9-3420. (Registration

materials will not be sent until later

this year.)

San Francisco Regional Conference : September 30 - October 1

The San Francisco regional

conference will offer FEC workshops

for the committees and organizations

listed above. Additionally. representatives of the Internal Revenue Service

and the California Political Fair

Practices Comntission will be on hand

to answer questions.

I The FEC willalso hold three conferences in 1994: a Washington, DC,

conference for candidate committees

(February); a New Orleans regional

conference (March); and a Piusburgh

regionalconference (April). It is too early

10 calf the FECfor dates or registration

information. Lookfor announcementsin

future Record issues.

The $135 fee for the conference (I

and 1/2days) covers three meals (two

continental breakfasts and a lunch)

and a reception. The conference will

be held at the Hotel Nikko San

Francisco (415/394-111 1). To receive

the group rate of $120 per night,

notify the hotel that you will be

attending the FEC conference. •

Publications

FEC's 1992 Annual Report

NowAvailable

The FEC recently released its

annual report for 1992, a year of

intense activity for the agency. The

report features several items of special

interest:

• A recap of the unique aspects of the

1992 election year: Ross Perot's

candidacy; the swelled number of

Congressional candidates; the huge

volume of campaign finance

activity; and the record workload

generated by these factors.

• A summary of the Presidential

elections and the public funding

program, complete with graphs.

• More campaign finance graphs on

the activity of PACs, party and

Congressional candidates.

• A discussion of the Commission's

efforts to speed up the Presidential

audit process.

• An overview of legal developments

in advisory opinions. litigation and

regulations.

• A complete set of the most farreaching recommendations for

legislative change ever adopted by

the Commission.

The report was sent to the President and Congress on June 1, 1993; it

is available to the public free of

charge. Use the order form on

page 7. •

Federal ElectionCommission RE

Clearinghouse

Updated Edition of Electio

Case Law Released

Election Case UlW. an overvi

election-related law as applied b

federal and state appellate courts

recently updated by the FEC' s

National Clearinghouse on Elec

Administration. Election Case L

covers cases reported in the Wes

Publishing Company system thr

the end of 1992.

Each chapter surveys thejudi

treatment of an election issue. A

the topics covered are reapportio

ment, ballot access, voter registr

and the Voting Rights Act.' The

chapters open with a comprehen

summary of the currentstate of 

law in the subject area, followed 

summaries of the leading appell

court cases. Each chapter also

contains synopses of other selec

cases and a bibliography of sele

literature.

To order the publication,send 

$15 check payable to the Superi

dent of Documents along with th

and stock number (Election Cas

93, 052-006-00053-8) and your 

and address to: Superintendent o

Documents, Government Printin

Office. Washington. DC 20402. 

I Campaignfinancematters are gen

beyond the scope ofthe publication

although four cases are included be

they bear on election regulation in

general. Summariesof cases specif

related to the FederalElection Cam

Act are found in SelectedCourtCa

Abstracts. To order a free copy. cal

424-9530or 2021219·3420.
Federal Election Commission RECORD ---- - - - - - - --

Statistics

PAC Contributions Inc rease

19 Percent

In the 1991-92 election cycle. PAC

contributions to federal candidates

totaled $188.7 million, up 19 percent

from the $159 million PACs gave to

candidates in each of the two previous

election cycles. Most of the money-

$ 179.2 million-went to House and

Senate candidates seeking election in

1992; less than $800,000 was given to

1992 Presidential contenders.

For the first time since 1977, PACs

spent more than they raised. Drawing

on surplus funds from previous

cycles, they spent $394 million, $9

million more than they raised in the

1992 cycle. PAC spending rose more

than 10 percent over the previous

cycle, while fundraising increased

only 4 percent.

The jump in the overall campaign

finance activity of PACs and other

committees may be due to an unusual

set of factors at work in the 1992

cycle: Congressional redistricting; a

large number of House retirements;

three Senate special elections,

including one in California, and

another open-scat Senate race in

California.

lilly 

TIle accompanying graphs are

based on an April 29 FEepress

release, which provides comprehe

sive PAC data for the 1991-92 cyc

and summary statistics for six prev

ous cycles. The release also ranks 

"top 50" PACs in terms of receipts

contributions to candidates. disbur

ments and ending cash on hand.

For a copy of the release, call 8

424-9530 (ask for Public Records) 

202/219-4 140. A complete rankin

all PACs making contributions to

candidates in the 1991-92cycle is

also available from the Public

Records Office. •

Distri bution of PAC Contributions to Candidates

1991-92 Election Cycle

_ Perce ntage of Totcll PACs within Cageto

Percentage of Total PAC Contr ibut ions

to Ca ndida tes, within Category

To ta l Contr ibutions Cor porate

$68.41 Million I

1,930 Committees 2

La bor

$41.34 Million

372Committees

Nonconnected

$ 18. 19 Million

1,377 Committees

T rade/Membersh

Health

$53.76 Million

836 Committees

Greater Than $ 1.000.000

$500.00 1-$ 1,000.000

$250,00 1-$500,000

$100,00 I- $250,000

$50,001-$ 100,000

$5,00 1-$50,000

$1 -$5,000

$0

25% 50% 25% 50% 25% 50

Explanation

For each type of PAC, the firstset of bars (dark)shows the percentage ofcommittees whosetotal contributions to candidates fell

within a given dollar range. For example, in the corporate category, the longest barshows that about 35 percent of corporate PACs g

between $5,00 1<U1d $50.000 in contri butions to candidates, Less than one percent ofcorporate PACs (toosmall to register on the

graph) made total candidate contributions greater than$500,000 or $ J million.

Thesecond set of bars ineach category shows what percentage oftotal contributions tocandidateswere made by PACs whose

candidatecontributionsfell within a given dollar range, In the corporate category, the longest barshows that PACs whose contributi

to candidatestotaled between $ 100,00I and$250,000 accounted for about 30 percentof the $68.41 million contributed byallcorpo

PACs.

I For each category, this fig ure represents the total contributions to candidates made by all PACs ill the category.

! For each category, thisfig ure represents the total number ofregistered PACs in the category.

4
July /993 Federal Election Commission REC

-------------

•

PAC Contributions to Candidates by Party Affiliation

1991-92 Election Cycle

(Millions of Dollars)

Democrats

Republicans

o 30 60 90 120 

Corpora te

Lab or

Noncon nected

Trade/MembershiplHealth

I Other

To ta l

I J

.1

D

:I

11II

r I 

r I

, - - .. -----

Ind ependent Expenditures by PACs

Over Four Presidential Election Cycles

(M illions of Dollars)

20 - -

For House and Senate Candidates

Against House and Senate Candid

For Presidential Cand ida tes

Against Presidential Candidates

•

15 r-- -

5 1- - - - -

1979- 80 1983-84 1987- 88 1991- 92

I "Other" consists ofPACsformed by cooperatives rout corporations without capital stock:
(J ElectionCommission RECORD

Advisory

Opinions

AO 1993-6

Use of Excess Funds

by Fonner HouseMember

Although Citizens for Congressman Panella. the campaign committee

of former House Member Leon E.

Panetta, may not use excess campaign

funds for Mr. Panetta's personal use,

it may use them to pay hotel expenses

related 10 closing down hisCongressional office; 10 pay his travel expenses for certain party-related

appearances; and 10 make charitable

donations. However, the committee

may norcover travel expenses for

days spent on personal activity orfees

for his membership in tax-exempt

organizations, as these would constilUte a prohibited personal use of

excess funds. In addition to making

permissible disbursements from

excess funds. the committee may use

campaign funds for operating expenditures to wind down its activities.

Although for merlyeligible 10

convert excess campaign funds CO

personal use because he was a

Member of Congress on January 8.

1980 (i.e., a "grandfathered"

Member), Mr. Panetta lost thatstatus

when he was sworn in as a Member

of the I03d Congress on January 5,

1993. (The Ethics Reform Act of

1989 amended 2 U.S.c. §439a by

prohibiting Members of the 103d or

later Congresses from converting any

excess campaign funds to personal

usc.)

Mr. Panetta resigned his Congressional seat on January 21 and was

sworn in to his new position, Director

of the Office of Management and

Budget (OMB), on January 22.

Hotel Expenses

During the two-week period

ending January 29, Mr. Pancna and

his family stayed at a Washington.

OC, hotel. He used part of the space

as an office 10 wind down his Con6

gressional duties (assisted by his wife)

and to conduct OMB business.

Because the law permits the use of

excess campaign funds 10 defray

expenses in connection with the

individual's duties as a federal

officeholder,' the committee may pay

thai portion of hotel expenses related

to Mr. Panetta's Congressional duties.

2 US c. §439a. Sec also AO 1978·23

(retired Congresswoman permitted to

usc excess campaign funds to employ

staff and pay " incidental expenses"

for duties imposed by her status as a

former Member of Congress).

Because the term " federal office"

applies only to elected federal offices,

however, the committee may nor pay

hotel expenses related to Mr.

Panetta's duties as OMS Director, an

appointed position.' Payment of those

expenses would constitute personal

use of excess campaign funds.

So too would the committee's

payment of the Panetta family' s

personal Jivi ng expenses, based on

AO 1980-138 (Senator-elect not

permitted to use excess campaign

funds [0 pay personal living expenses

incurred during the transition period.

before he assumed office, because

they would have existed regardless of

the outcome of the ele-ction).

The committee may therefore pay

a percentage of the hotel expenses

based on the time and hotel space

devoted to winding down the Congressional office compared with that

I Campaign contributions to maint ain an

"unofficial office account " or to defray

"offi cial" expenses are ge~ alJy barred.

2 U.s.c. §59e(d'. See also House Rules

43 and 45 and Senate Rule 38.

1Under 2 U.s.c. §oI3/(3,. the term

'f ederal office" is limited /0 the Presidency. lhe Vice Presidency and seats in

the U.S. Congress. /n this regard. t~

Commission concluded thasAO / 98()./ 13

is superseded 10the eueor it held /hat

§-I39apermits a forme r ~deraJ candidate

to spend campaign f undsfor expenses

related 10 lhe individual 's position as a

holder ofstate office or any office nO/

defined as a f ederal office.

July 

devoted to OMB duties and person

activities.

T ravel Expenses for Party

Appearances

The committee may pay Mr.

Panetta' s round-trip [ravel costs to

appear as the invited honoree or

featured speaker at Democratic pa

events held in his former Californi

district. This would be a permissib

use of excess campaign funds und

§439a, which allows excess campa

funds to be transferred in unlimite

amounts 10 party committees.The

travel payments would qualify as

transfers in lind to the party comm

tee. since the commiuee would

receive the samebenefit from the

payments as from an actual transfe

the funds.

[f a trip combined both partyrelated and personal activities, the

committee could pay no more than

transportation 10 and from the part

committee event and related lodgi

and per diem costs (generally no m

than one night per event). Paymen

Mr. Panetta's expenses for days sp

in personal activity would be a

prohibited use of excess campaign

funds.'

Payments to Tax-Exempt

Organizations

Section 439a states that excess

campaign funds "may be contribut

to any organization described in

§l70(c) of title 26." which include

the kind of charitable nonprofit

organizations (26 u .s.c. §50 1(c)(3

to which the Panena committee wo

like to make payments.

However, the charitable donatio

referred 10 in §439a do not include

payment of dues or other members

fees on behalf of Mr. Paneua, who 

J The campaign travel regula/ions at

1I CFR 106.3. which go travel by 

on ~1ulJf ofa federal candidate, do n

apply M re. since Mr. Panella is a fo rm

candidall' and the proposed 'l' it

appears. would nOI beon beJuJlfofan

current f~deral candidase.
July /993 Federal Election Commission REC

Name

Organization

Order Fonn: Annual Report 1992

~---------------------

Index

The first number in each citat

refers to the "number" (month) o

1993 Record issue in which the a

appeared. The second number, fol

ing the colon, indicates the page n

ber in that issue.

Advisory Opinions

1992-38: Loan from Presidential

campaign's legal and complian

fund 10 public funding account

1992·40: Commissions earned by

state party committees. 2:5

1992-41: Solicitation of members

J992-42: Bank deposit lost in ma

3:3

1992-43: Preemption of Slate law

fundraising restrictions, 3:4

1992-44: Qualifying as nationalp

committee, 6:5

(continued on pa 

purchase new headquarters: preem

tion of state law prohibiting corpo

donations to building funds. (Mic

gan Republican State Committee

June 22, 1993; 6 pages) .

Send your order to: Federal Election Commission

Information Division

999 E Street, NW

Washington, DC 20463

Vice Chairman Trevor Potter filed

a dissenting opinion. Date Issued:

May 14, 1993; Length: 10 pages(plus

3-page dissent) •

Advisory Opinion Request.

Recent requests for advisory

opinions (AORs) are listed below.

The full text of each AOR is available

for review and comment in the tEC's

Public Records Office.

AOR 1993-7

Name change of connected organization and its PAC. (pacific Power &

Light Company;June 8, 1993; 4

pages)

AOR 1993-8

Slate law prohibiting federal and

nonfederal contributions by federal

committee incorporated for liability

purposes only. (Congressman John 1.

Duncan, Jr.;June 8, 1993; 3 pages

plus 5-page attachment)

AO R 1993-9

Use of party building fund to payoff

land contract for existing party

headquarters; use of proceeds from

sale of party's interest in contract to

Reporting the Payments

While the above campaign-related

expenses would be reportable as

operating expenditures, the other

payments (hotel expenses, party travel

and charitable donations) would be

reportable as "other disbursements."

The purpose of the party travel

payments should be described as

"travel expenses/transfer (in kind) to

party committee of excess funds."

II CFR 104.3(b)(4)(i)(A).

neither a federal candidate nor a

federal officeholder. Such payments

would benefit him financially and

thus co nstitute a prohibited personal

use of campaign funds.'

winding-Down Expenses

The Panetta committee's funds

may be used 10 hire individuals to

complete the committee's 1993

midyear report, to pay storage costs

for campaign records and to pay other

costs of winding down campaign

activity, However, the committee may

not continue 10 use campaign funds

indefinitely; it may need to seek

another advisory opinion if it intends

to make campaign expenditures after

July 31,the midyear repon filing date.

Tax Ramifications

The Commission expressed no

opinion on the federal or state tax

ramifications of the proposed payments since those issues are not

within itsjurisdiction. The opinion

citedms Reg. 1.527-5(c)(1) and an

mstraining manual, Exempt Organizations, 1992, at 469, 470 (principal

campaign committee of former

candidate not allowed to remain in

existence for longer time period than

reasonably necessary to wind up

affairs of past campaign).

•

•

• * If ordering more than 25copies, please include your phone number.

•The Commissionhas been undecidedin

the past as 10 whether payment of

membershipfees on behalf of a current

federal candidate orfederal officelwlder

constitutes persona/ lise of campaign

funds. See. e.g.. concurring opinions

regarding AOs 1992-4and 1992·1.

Address

City

Number of Copies

Slate

Phone Numher e

Zip Code
FederalElectionCommission RECORD

--- - - - - - - ---- July 

- ----- - - - ---

Index

(continued from page 7)

1993-1 : Campaign's rentalof storage

unitfrom candidate, 4:8

1993-2: Application of partyspending

limitstoTexas specialrunoff, 4:9

1993-3: Retroactive reallocation of

1991 -92 activity, 5:1

1993-4: Electronic payment of bills

through computer, 6:5

1993-5: 1992 contributions rnisplaced

at post office, 6:6

1993-6: Use of excessfunds by

former House member, 7:6

ourt Cases

FE v.

- America's PAC, 4:10

- International Funding Institute, 1:2;

5:2

- Miller, 6:8

- National Republican Senatorial

Committee (93·0365), 6:8

- People& Politics, Inc., 3:3

v. FEC

ommonCause (92-0249 (JHG»,

4:10

FEDERAL ELECTION COMMISSION

999 E Street, NW

Washington, DC 20463

Official Business *

Printed on recycled pape r

- Common Cause (92-2538), ):8

- LaRouche (92-1 100), 6:8

- Lakouche (92-1555), 1:8

- National Rifle Association (92-

5078),4: 10

- Spannaus(91-0681), 6:7

- White (93-771), 6:8

U.S. SenatorJohn SeymourCommittee v, Dianne Feinstein, ):8

Reporting

Last-minute contributions: 48-hour

reporting, 4:7

Reporting problems, letter to new

candidates, 4:8

Schedule for 1993, ):3; 6:I

Special elections in California,

Mississippi, Ohio,Texas and

Wisconsin, 3:1; 4:7; 6:4

800 Line Articles

Credit card contributions, 5:5

Party committee allocation: carrying

debtsfrom previous election cycle,

2:7

$25,000annual limit, 4:2

Reminder: Midyear

Report Due July 31

PACs and party committees

(except monthly filers) and

authorized committees of House

and Senate candidates must file a

midyear report by July 31.

(Because this is a nonelection yea

most committees file on a semiannual, rather than quarterly,

basis.) For more information, see

the January or June issues. You ca

also order a 1993 reporting

schedule from the Commission

(800/424-9530 or 20212 19-3420).

Please call the Commission wit

your reporting questions.

Bulk Rate Mail

Postage and Fees Paid

Federal Election Commissio

Permit Number G-31