999 E Street NW Washington DC 20463 Volume 13,Number 

11 INDEX

PUBLIC FUNDING

4 Bush and Dole Eligible

4 Mondale/Ferraro Final Payment

Determination

TABLE OF CONTENTS

1 Advisory Opinions

800 LINE

9 Honoraria

CLEARINGHOUSE

9 Renewal of Clearinghouse Advisory

Panel Charter

REGULATIONS

5 FOIA and Public Disclosure Regulations

STATISTICS

6 Financial Activity of PACs

6 Party Activity Declines

COMPLIANCE

5 Extensions of Time in Enforcement

COURT CASES

9 FEC v. Americans for Jesse Jackson

ADVISORY OPINIONS: SUMMARIES

An Advisory Opinion (AO) issued by the Com

mission provides guidance with regard to th

specific situation described in the AOR. A

qualified person who has requested an AO a

acts in accordance with the opinion will not 

subject to any sanctions under the Act. Oth

persons may rely on the opinion if they a

involved in a specific activity which is indisti

guishable in all material aspects from the activi

discussed in the AO. Those seeking guidance f

their own activity, however, should consult th

full text of an AO and not rely only on t

summary given here. continu

FEDERAL ELECTION COMMISSION

Affiliation between PACs of corporation and its spin-off corporation.

(Date made public: June 12, 1987;

Length: 5 pages, plus 112-page supplement)

Contributions and Donations by

Principal Campaign Committee and

Multicandidate :gAC. (Date made

publice June 8, 1987; Length 1 page)

Solicitations for PAC of U.S. subsidiary of Canadian corporation.

(Date made public: June 9, 1987;

Length: 3 pages)

Subject

1987-19:

1987-21:

1987-20:

AOR

ADVISORY OPINION REQUESTS

The following chart lists recent requests for

advisory opinions. The full text of each AOR is

available to the public in the Commission's Office

of Public Records.

AOR 1987-20: Solicitation for PAC of U.S.

Subsidiary of Canadian Corporation

The requester withdrew the advisory opinion request in a letter of July 7, 1987.

ALTERNATE DISPOSITION

OF ADVISORY OPINION REQUESTS

AOR 1987-19: Contributions and Donations by

Principal Campaign Committee

and Multicandidate PAC

The requester withdrew the advisory opinion request in a letter of July 7, 1987.

August 1987

AOR 1987-10: Contributions to Presidential

Primary Candidate's 1988

Campaign Used to Retire 1984

Presidential Campaign Debts

In a letter of July I, 1987, the Acting General

Counsel stated that, until a final determination is

made by the Commission concerning Mr. Hart's

eligibility for matching funds, the Commission has

decided to suspend and hold in abeyance any

further consideration of the advisory opinion request.

e,
August 1987 FEDERAL ELECTION COMMISSION

AO 1987-11 Use of Excess

Campaign Funds

The Committee to Re-Elect Senator Zorinsky, the

princlpal campaign committe of the late Senator

Edward Zorinsky, may dispose of approximately

$180,000 in excess campaign funds in the following ways:

1. Transfer the excess funds to the late Senator's

wife.

2. Transfer the excess funds to a trust for the

benefit of Mrs. Zorinsky.

3. Create a charitable foundation under Mrs.

Zorinsky's control.

4. Transfer the excess funds to the Zorinsky family.

5. Transfer the excess funds to various qualified

charitable organizations.

6. Transfer the excess funds to local or national

political party committees.

7. Use excess funds to defray costs incurred by

Senator Zorinsky's widow in closing the Senator's Washington office and moving back to

Nebraska.

8. Refund contributions to original donors.

9. Use excess campaign funds to create a state

political action committee to support or oppose

ballot issues and to support candidates for state

and federal offices.

The Act provides that excess campaign funds

may be; used by an individual or candidate to

defray ordinary and necessary expenses incurred

in connection with his or her duties as a holder of

federal office; donated to qualified. charitable

organizations; transferred without limit to any

national, state or local political party committee;

or used for "any other lawful' purpose"; except

that a candidate other than one who was a Senator or Representative in Congress on January 8,

1980, may not use excess campaign funds for

personal use. 2 U.S.C. §439a and 11 CFR 113.2.

However, since Mr. Zorinsky was a member of the

U.S. Senate on January 8, 1980, the distribution of

excess campaign funds for the personal use of his

family members would not be prohibited by the

Act.

Payment of expenses to close down the late

Senator's office and move his widow from

Washington, D.C. to Nebraska are specifically

permitted under the Act because they constitute

ordinary and necessary expenses in connection

with the duties of a Federal office holder. Furthermore, refunding contributions is lawful since

\bIurne 13, Number

the reporting provisions of the Act anticipate th

making of such refunds. 2 U.S.C. S434(b)(4)(F

and (b)(5)(E).

Use of excess campaign funds to create 

state political action committee to support o

oppose ballot issues and to support candidates fo

state and federal offices is permitted by the Act

However, the Commission noted that if th

Zorinsky Committee made a contribution to any

federal political committee, the contribution lim

its contained in the Act would apply. (Dat

issued: June 11, 1987; Length: 6 pages)

AO 1987-13 Trade Association's Solicitation

of Contributions

GHAA PAC, the separate segregated fund of th

Group Health Association of America, Inc

(GHAA), an incorporated trade association, ma

not solicit contributions from physicians who

operating as partnerships, provide health car

pursuant to contracts with health maintenanc

programs.

Prepaid health care systems that are eligibl

for membership in GHAA are defined as healt

maintenance organizations (HMOs) and/or com

petitive medical plans. These organization

provide basic health services to enrolle

participants through physicians with whom they

have made prior arrangements. The HMOs ma

provide care in a variety of ways, for example

through organized groups of physicians (grou

practice model), such as physician partnerships

GHAA asked whether these physicians could b

solicited for contributions to the PAC.

Under the Act, an incorporated trade associ

ation may solicit its noncorporate members fo

contributions to its separate segregated fund. 1

CFR 114.7(c). Commission regulations define 

membership organization's members as "all per

sons who are currently satisfying the require

ments for membership in a membership organiza

tion,' 11 CFR 114.l(e). To qualify as a member

the Supreme Court in Federal Election Commis

sion v. National Ri ht to Work Committee 45

U.S. 197 1982) stated that some relatively en

during and independently significant financial o

organizational attachment is required to be 

"member" under the Act. Generally, this ha

meant that persons must have some right t

participate in the governance of the organizatio

and pay regular dues.

The Record is published by the Federal Election Commission, 999 E Street, N.W., Washington,

D.C. 20463. Commissioners are: Scott E. Thomas, Chairman; Thomas J. Josefiak, Vice Chairman;

Joan Aikens; Lee Ann Elliott; Danny Lee McDonald; John Warren McGarry; Walter J. Stewart,

Secretary of the Senate, Ex Officio; Donnald K. Anderson, Clerk of the House of Representatives,

Ex Officio. For more information, call 202/376-3120 or toll-free 800/424-9530. (TDD For Hearing

Impaired 202/376-3136)

2
August 1987 FEDERALELECTION COIVlMISSION Volume 13, Numbe

The physician partnerships had no obligation

to pay dues and no right to participate in GHAA's

governance in their capacity as independent contractors. Moreover, these physicians had chosen

not to become direct, individual members, with

financial obligations and rights to participate in

governing GHAA. Therefore, the Commission

concluded that physician partners under contract

with the HMO members of GHAA would not

themselves be considered "members" for purposes

of solicitation. (Date issued: June 25, 1987;

Length: 3 pages)

AO 1987-14 National Bank's SSF Supporting Only

State and Local Candidates

Even though the separate segregated fund of the

First National Bank of Shreveport will be organized solely for the purpose of financing political

activity in connection with state and local elections, It will be subject to the solicitable class

restrictions, the voluntary contribution requirements and the solicitation notice provisions of the

Act. 11 CFR 114.2(a)(2).

Under the Act, a national bank is prohibited

from making a contribution or expenditure in

connection with any election to any political

office, including local, state and federal offices.

2 U.S.C. §441b(b)(2)(C). However, a national bank

is permitted to establish and sponsor a separate

segregated fund for financing political activity if

it wishes to engage in political activity on a local,

state or federal level. Commission regulations,

however, specifically exempt a separate segregated fund from the registration requirements if it is

established solely to finance state and local election activity. 11 CF R 102. Hc). The Shreveport

Bank fund will not be SUbject to the rules concerning registration, reeordkeeplng, reporting and

contribution limits. However, because the fund is

a "separate segregated fund," under 2 U.S.C.

§44lb, the solicitable class restrictions, the voluntary contribution requirements and the solicitation notice provision contained in the Act will

apply. 2 U.S.C. §441b(b)(3). (Date issued: June

25, 1987; Length: 4 pages)

AO 1987-16 Transfers from State Campaign

Committee to Federal Campaign

Committee

The Dukakis Gubernatorial Committee (the state

committee) may transfer, without limit, computer

equipment and contributor and supporter lists to

the Dukakis for President Committee, Inc. (the

federal committee).

Because the computer and contributor lists

are things of value, they would be considered

contributions-in-kind (or transfers) from the state

committee.

3

Under Commission regulations, transfers m

be made without limit between affiliated comm

tees. II CFR l06.6{a). The state and feder

committees are considered affiliated becau

they were both established and controlled by t

same person, Mr. Dukakis, See 2 U.S.C. §44la(

(5) and 11 CFR 100.5(g)(2) and 110.3(a)(1) (i).

The Com mission's approval of the ass

transfers was conditioned on its understandi

that the state committee accepted only fun

that were lawful under the Federal Election Ca

paign Act. Therefore, the transfer of assets cou

not be seen as an indirect corporate or lab

contribution, which is prohibited by the Act. 

U.S.C. 5441b. 

Finally, the Commission noted that the

asset transfers should be reported by the feder

committee as an in-kind contribution from t

state committee with a brief description of t

equipment and supporter lists. 

In a footnote, the Commission observed th

the state committee had registered earlier as 

political committee, as required by law, when 

transferred $380,000 to the federal committe

That monetary transfer was SUbject to Comm

sion regulations requiring review, reporting a

exclusion of prohibited contributions received 

the state committee account. Further, becau

the state committee had received contributio

during the current election cycle (i.e., in t

period since the general election in 1986), t

state committee (now registered as a politic

committee under the Act) had to be sure t

transfer did not cause donors to exceed th

contribution limits. To this end, the committ

was required to aggregate contributions ma

after the 1986 election with those made to t

federal committee by the same donor. (Da

issued: July 9, 1987; Length: 6 pages)

AO 1981-11: Combined Membership Dues and

Contribution on Billing Statement

AGFUND, the separate segregated fund of t

Texas Farm Bureau, may use a billing statemen

accompanied by an explanatory notice, that com

bines a dues statement with a solicitation to t

PAC. The billing statement includes the follo

ing information:

AGFUND Voluntary Contribution(s)

Suggested (See Enclosure) $ 1.00

Membership Dues 20.00

Total Amount $21.00

The accompanying notice describing t

political purpose of AGFUND explains that t

contribution printed on the statement is 

suggestion only, and that the member c

continu
August 1987 FEDERAL ELECTION COMMISSION

contribute more or less than $1.00, and that the

decision to contribute or not will not favor or

disadvantage the member. The combined billing

statement and notice are acceptable because:

1. They notify members of the political purpose of

AGFUND and of their right to refuse to

contribute without reprisal.

2. They emphasize the voluntary nature of the

PAC contributions.

3. They convey a clear distinction between the

membership dues portion of the total and the

suggested AGFUND contribution.

In previous advisory opinions, the Commission

has approved several specific proposals for combining contribution solicitations with dues statements. See Advisory Opinions 1982-61, 1982-11,

and 1981-4. Compare AO 1987-6 where the

Commission concluded that the combined billing

statement and contribution solicitation were improper. See May 1987 Record, page 5.

Contributions to AGFUND must otherwise

comply with the Act and FEC regulations, including the requirement that individuals who are solicited on the basis of their membership in the

Texas Farm Bureau must meet the Commission'S

standard for membership. 11 CFR 114.1(e) and

114.7. (Date issued: June 25, 1987; Length. 5

pages)

AO 1987-18: PAC Matches Employee

Contributions with

Commodity Charitable

Donations

Texas Industries, Inc. (TXI) may encourage contributions to its PAC (TXI-PAC) by matching individual contributions with donations to a charity of

the contributor's choice. Under a proposed plan,

TXI would:

1. Allow contributors to designate a charity from

a list of 5-10 selected by TXI;

2. Match voluntary contributions with charitable

donations of money and/or commodities; and

3. Distribute the charitable donations over a twoyear period after the contribution was made to

TXI-PAC.

The Commission noted that this plan was materially indistinguishable from the one previously approved by the Commission in Advisory Opinion

1986-44.

Under the Act, a corporation is prohibited

from making contributions or expenditures in connection with any federal election. 2 U.S.C.

§441b. However, election law allows a corporation

to pay for the establishment, administration and

solicitation expenses of its PAC, provided it does

not use this process as a means of exchanging

treasury monies for voluntary contributions. See

11 CFR 114.5(b). TXPs donations to charities

would be considered a solicitation expense and not

a prohibited exchange of treasury monies.

4

\.bIume 13, Numter8

The Commission noted that, since the com

munication of this plan constitutes a solicitation

TXI and TXI-P AC may offer the plan only to

those persons who may be solicited for contribu

tions. The corporation and PAC must also comply

with the other solicitation requirements of FEe

regulations. (Date issued: July 9, 1987; Length: 

pages)

BUSH AND DOLE DECLARED ELIGmLE FOR

PRIMARY MATCHING FUNDS

On June 8, 1987, Vice President George Bush

was declared eligible to receive federal matching

funds in his bid to win the Republican nomination

for President. On June 15, another Republican

candidate, Senator Robert Dole, also established

matching fund eligibility.

In order to become eligible for matching

funds, a candidate must raise over $100,000 by

collecting more than $5,000 in 20 different state

in amounts no greater than $250 from any indivi

dual. Presidential candidates may begin seeking

eligibility for primary matching funds after Jan

uary 1, 1987. However, matching funds will no

be distributed until after January 1, 1988.

The maximum amount of matching funds a

Presidential candidate may receive is half of the

base spending limit. Since that limit may be as

much as $22 million in 1988, Presidential primary

candidates could qualify for as much as $11

million in federal dollars.

MONDALB/FERRARO

FINAL REPAYMENT DETERMINATION

On July 9, 1987, the Federal Election Com

mission determined that the Mondale/Ferraro

Committee, Ine., (the Committee) must repay

$180,784.59 t.o the United States Treasury in

accordance with the final repayment determina

tion. This amount includes repayments o

$90,642.40 in surplus funds and $90,142.19 in ne

interest income earned by the committee. The

Committee had received $40,309,357.60 from the

Presidential Election Campaign Fund in 1984, bu

its final Statement of Net Outstanding Qualified

Campaign Expenses indicated qualified net expen

ditures of only $11,0,303,656.60. The Com mission

also approved a Statement of Reasons in suppor

of the final repayment determination.

Copies of the Mondale/Ferraro Final Repay

ment Determination may be obtained from the

Commission's Public Records Office. Cal

800/424-9530 or, locally, 376-3140.
August 1987 FEDERAL ELECTION COfVlNllSSION \bIume 13, Numbe

EXTENSIONS OF TIME IN

ENFORCEMENT MATTRRS

On June 4, 1987, the Federal Election Commission adopted several new procedures concerning Commission policy on granting extensions of

time in enforcement matters. The new procedures are intended to expedite responses to requests for time extensions by giving the Office of

General Counsel (OGC) greater latitude to grant

extensions without first obtaining Commission approval.

Under the Federal Election Campaign Act,

respondents have an opportunity to submit responses to allegations made against them at several stages during the enforcement process. The

new procedures focus on the respondent's response

at three stages in particular:

o After being notified about a complaint;

o After the Commission finds "reason to believe"

the Act has been violated; and

o After the General Counsel issues a brief, recommending "probable cause to believe" the Act

has been violated.

The Commission approved the following new

procedures recommended by aGc:

1. The Commission authorized OGC to grant extensions of time of up to 30 days for responses

to complaint notifications. Because this is a

critical stage in the enforcement process, eGC

will limit extensions to no more than 15 or 20

days and will grant 30 days only where exceptional good cause is demonstrated.

2. aGe was given discretion to grant or deny

extension requests of up to 45 days for "reason

to believe" and "probable cause" briefs. Extensions beyond 30 days, however, will be granted

only in exceptional circumstances.

3. Commission approval will no longer be required

for additional requests or requests for extensions of time that are submitted later than 5

days prior to the original due date, as long as

the requested extension does not exceed 30

days from the original due date for responses to

complaints or 45 days from the original due

date for responses to "reason to believe" findings and "probable cause" briefs.

4. The Commission will continue to require that

requests for extensions of time be made in

writing and that requests that do not meet

certain guidelines be SUbmitted to the Commissioners for their approval.

5.0Ge will inform the Commission about any

extensions of time (including the reasons for

the extension and the new due dates) whenever

an extension delays the General Counsel's reports on "reason to believe" or "probable cause"

recom mendations.

5

INTERIM RULES REVISING FOIA AND

PUBLIC DISCLOSURE REGULATIONS

On June 18, 1987, the Federal Election Co

mission approved for publication in the Fede

Register interim rules governing the Freedom 

Information Act (FOrA) and access to Public D

closure Division documents (11 CPR Parts 4 a

5). These interim rules were precipitated by 

enactment of the Freedom of Information Refo

Act of 1986 (the Reform Act) on October 

1986, as sections of the omnibus Anti-Drug Ab

Act of 1986. The Reform Act expanded the l

enforcement protections of the FOIA and a

modified the ForA's fee provisions, including 

fee waiver standard.

The new law enforcement amendments w

effective immediately upon the enactment of 

Reform Act. However, with regard to FOIA fe

the statute specified that the new provisi

would not take effect for 180 days to allow 

Office of Management and Budget to issue agen

guidelines on the new FOIA fee schedules. Th

guidelines were published March 27, 1987. Sin

the Reform Act required that agencies follow 

new fee provisions beginning April 27,1987, 

Commission published a new FOIA fee schedu

on which it sought public comment, as inter

rules. The interim rules, effective on June 

1987, are summarized below. Comments must 

submitted in writing by JUly 24, 1987, to M

Susan Propper, Assistant General Counsel, FE

999 E Street N.W., Washington, D.C. 204

Comments should refer to specific sections of 

proposed regulations.

Law Enforcement Provisions

11 CFR 4.5(a)(7)

Congress adopted the new enforcement p

visions primarily to protect law enforcement 

cords sufficiently to enable agencies to enl

informants and to carry out confidential inves

gations. The previous provisions did not prov

sufficient protection because the language p

mitted records to be exempted from disclosu

only when those records would clearly reveal 

informant's identity or a confidential investi

tion. Anything short of that definitive stand

had to be disclosed. The Reform Act revised t

language to exempt from disclosure any inform

tion that could "reasonably be expected" to rev

a confidential source or investigation.

In addition, under the interim rules, inform

tion originally compiled for law enforcement p

poses does not lose its special exemption fro

FOlA disclosure when it is included on anoth

document. For example, when the Commiss

receives records from the Department of Just

continu
August 1987 FEDERAL ELECTION COMMISSION

(as part of a referral) which are subject to an

exemption from FOIA disclosure because they

include information originally compiled for law

enforcement purposes, the records would retain

that exempt status while in the Commission's

possession.

Fee Provisions

11 CFR 4.9(c)

The Reform Act aims to establish a uniform

standard for FOIA fees among all agencies. To

this end, OMB has issued guidelines which permit

agencies to develop their own fee schedules in

conformance with government-wide standards.

Accordingly, the proposed fee schedule, set forth

at 11 CFR 4.9(c)(4), has been revised to reflect

changes in the direct cost for various services

(including" photocopying, computer services, microfilming and staff salaries). As recommended

by OMB, the Commission has determined these

fees on the basis of the Commission's average

costs for the services.

The Reform Act does, however, impose some

restrictions on an agency's ability to assess FOIA

fees. It also divides FOIA requesters into several

categories, each of which may only be charged for

certain services. For instance, except in the case

of a commercial use requester, an agency may not

charge an FOIA fee for the first two hours of

search time and the first 100 pages of duplication.

No fee may be assessed for search time related to

FOIA requests from educational, scientific or

news media organizations. Further, an agency

may not charge a fee to a requester when the

direct cost of the FOIA request is equal to or less

than the agency's cost of routinely collecting and

processing an FOIA request fee.

In addition to revising the FOIA fee provisions, the Reform Act also amended the fee

waiver standard. Under the new standard, incorporated in the interim rules, the Commission will

consider reducing or waiving FOIA fees if it

determines that disclosure is in the public interest

(i,e, promotes public understanding of government) and is not primarily in the commercial

interest of the requester.

Further, the proposed interim rules include

procedures for requesting a fee reduction or waiver. They also would permit the Commission to

charge interest on FOIA fees which are not paid

within 30 days. Finally, there is a provision

prohibiting requesters from aggregating requests

for the purpose of evading the assessment of fees

and another provision detailing the conditions

under which the Commission would require advance payment before responding to an FOIA

request.

Proposed Update of Public Disclosure Fees

11 CFR 5.6

While the fee schedule for regular public disclosure through the Commission's Public Records

6

\k:>lume 13, Number 

Office is distinct from the FOIA fee schedule, i

also needs updating to reflect recent changes i

cost to the Commission. The Commission also

proposed changes to 11 CFR 5.6 reflecting th

costs of microfilm and staff time. These change

are consistent with the new FOIA fee schedule.

FINANCIAL ACTIVITY OF PACS FOR 1985-86

Direct contributions to federal candidates b

PACs continue to increase according to figure

released on May 21 by the Federal Election Com

mission. The figures indicate that PAC contribu

tions to Congressional candidates in the 198

election rose 26 percent compared with th

amount given to candidates seeking Congressiona

seats in 1984.

In compiling figures for the 1985-86 cycle

the Commission reviewed the activity of 4,568

PACs. However, of these PACs, only 3,15

actually contributed to federal candidates durin

the 1985-86 cycle. According to their reports

PACs began 1985 with cash-on-hand of $55 mil

lion. They raised an additional $353 million an

spent a total of $338 million during the 1985-8

cycle. Chart I compares PAC contributions ove

five election cycles. Chart II shows financia

activity for PACs over five election cycles.

PARTY ACTIVITY DECLINES IN 1985-86

A decline in financial activity at the federa

level by both major political parties can be seen

in the newly released Commission figures for th

1985-86 elections. As Charts III and IV show, th

total amount of money raised and spent by both

parties was less than in the previous 1983-84

cycle. Both parties ended the election year with

less cash and higher debts.

In addition, the figures show that the Repub

lican Party continued to lead in overall fund

raising and spending. In direct support of federa

candidates, the Republicans maintained a slightly

less than two-to-one lead. The press release

detailing the amounts raised and spent by both

major parties, as well as contributions made to

federal candidates and monies spent on thei

behalf, may be obtained from the Commission'

Public Records Office. The FEC Report on

Financial ActiVity. 1985-86: Party and Non-Party

Political Committees. Final Report will be pub

lished in the Fall of 1987.
August 1987 FEDERAL ELECTION COMMISSION Volume 13, Numt€

CHART I

PAC CONTRIDUTIONS TO SENATE AND HOUSE CANDIDATES, 1985-86

350 40

1983-84 1985-86

Reeeipts

CJ Disbursements

200

7

1981-82

Millions of Dollars

150

1979-80

o 50 100

1977-78

CHART II

PAC FINANCIAL ACTIVITY

1983-84

1985-86

Millions or Dollars

150 '

1981-82

19'17-78

1979-80
August 1987 FEDERAL ELECTION COMMISSION \k)lume 13, Number 

CHARTm

DEMOCRATIC PARTY ACTIVITY, 1985-86*

o 10 20 30

Millions of Dollars

40 50 60 70 80 90 

3

Spen

Raised

250

1"

!

I

I

Contributions

Coordinated

Expenditures

!

j

..Contributions

~.Coordinated

Expenditures

200

i

i

-,

I

I

I

j

j

;

,

Millions of Dollars

50 100 150

Raised 

~~~~~~~~~===~~§gl

Spent 

<.~ Raised

Spent ""-"'-'L...-"""'"""":!---"'T"""-----:---:----:'I b7.~m~~~~~~""ii'["'1t~~ Raised

~~---:.- ,.._--.....,...-... Spent

tD0~~~~~~7'!JRaised

---I Spent

I ",.e" ".0 ~;,-:"'~ :. Raised

~"""""'-.l.- ---: ---:-"Spent

a

1977-78

1977-78

8

1981-82

1985-86

1985-86

1983-84

1979-80

1979-80

1983-84

1981-82

*With regard to the bar called "spent," the difference between the total spent, on the one hand,

and contributions and expenditures for candidates, on the other, reflects a. variety of party building

and administrative costs, including (but not limited to) staff salaries, fundraising expenses, research,

contributions to state and local party com mittees, etc.

CHART IV

REPUBLICAN PARTY ACTIVITY, 1985-86'*
Volume 13, Number 8

"'P. L. 92-463; 5 U.S.C. App,

continued

The Definition of an Honorarium

An honorarium is a payment of money (o

anything of value) to an officer or employee o

the federal government in consideration of an

appearance, speech or article. 11 CFR 110.12 (b).

An appearance means attendance at a public

or private gathering, convention, meeting, socia

event, or like gathering, and the incidental con

versation or remarks made at that time. 11 CFR

110.12(b)(2).

A speech means an address, oration or othe

form of oral presentation, regardless of whethe

presented in person, recorded or broadcast ove

the media. 11 CPR 1l0.12(b)(3).

An article is a writing, other than a book

which has been or is intended to be published, 1

CPR 110.12(b)(4).

The law covers appointed and elected offi

cials of the federal government and federal gov

ernment employees. 11 CFR 1l0.12(b)(l). Federa

candidates who are not simultaneously federa

offieeholders or employees are not SUbject to the

honoraria provisions. See Advisory Opinion Re

quest 1976-59.

HONORARIA

The Federal Election Commission often re

ceives calls concerning the laws for giving and

receiving honoraria. This article is intended to

highlight some of the pertinent points in the

Federal Election Campaign Act and the cor

responding regulations that deal with the SUbject.

The Limit for an Honorarium

The law places a limit of $2,000 on anyone

honoearim. 2 U.S.C. 44li(a) and 11 CFR 110.12

(a). The Act no longer mandates a total annua

limit. (However, incumbent members of Congres

should consult Senate and House Rules concerning

"outside income.") An honorarium donated to a

charitable organization is not SUbject to the hono

rarium limit. 2 U.S.C. 441i(b) and II CFR 110.12

(b)(5).

a balanced representation from state election

officials and local election administrators. The

Advisory Panel reports to the Commission through

the Staff Director and the Director of the Clearinghouse on Election Administration, who also

coordinates all activities of the Panel.

Under the Charter, the Advisory Panel will

terminate in two years unless terminated earlier

or renewed by the Commission.

9

FEDERAL ELECTION COMMISSION

.;I·r " .'. '

;:;-.;~INGHQUSE.:O"~~.:~; ,,) > c. ".' • \ ;

August 1987

RENEWAL OF CLEARINGHOUSE ADVISORY

PANEL CHARTER

On June 4, 1987, the Federal Election Commission, pursuant to the Federal Advisory Committee Act,* approved the biennial renewal of the

Clearinghouse Advisory Panel Charter (Advisory

Panel), beginning July 1987.

The objective of the Advisory Panel is to

advise the Commission, through its Clearinghouse

on Election Administration, on ways in which the

administration of Federal elections may be improved. Drawing upon the expertise of its members and other sources, the Advisory Panel makes

recommendations regarding possible topics of

Clearinghouse research efforts as well as suggestions for other means of assisting election

administrators in the performance of their tasks.

The Advisory Panel consists of sixteen

members, nominated by the Clearinghouse Director through the Staff Director of the Federal

Election Commission and appointed by the Federal Election Commission. When selecting

members to fill vacancies, care is taken to ensure

FEe v, AMERICANS FOR JESSE JACKSON

On May 21, 1987, the United States District

Court for the District of Maryland issued a consent order in FEC v. Americans for Jesse Jackson

(CA No. Y-86-3766). Americans for Jesse Jackson

was a 1984 political committee that was not

authorized by Presidential primary candidate

Jesse Jackson. In the consent order, the parties

agreed that Americans for Jesse Jackson violated

the Act in several ways:

o The committee failed to file a statement of

organization with the Commission after it had

spent over $1,000 expressly advocating the

election of Presidential candidate Jesse

Jackson. 2 U.S.C. S433(a).

o It failed to file the required reports of receipts

and expenditures with the Com mission.

2 U.S.C. S434.

o It used the name of Jesse Jackson in its name

even though the committee was not authorized

by the candidate. 2 U.S.C. §432(e)(4).

o It failed to include, on a mail solicita tion for

contributions, the name of the person who paid

for the communication. 2 U.S.C. S441d(a)(3).

The defendant agreed to pay a civil penalty

of $500 and to file all outstanding reports with

the Commission within 30 days.
August 1987 FEDERAL ELECTION COMMISSION Volume 13, Numbe

What is Not an Honorarium

Certain kinds of payments are not considered

honoraria and, consequently, are not subject to

the limits of the Act on honoraria. An honorarium does not, for example, include payments for

transportation, housing or meals for the

officeholder, a spouse or an aide. 11 CFR 110.12

(b). In effect, then, the recipient of the honorarium may accept such payments over and above

what he or she receives as honorarium. For

example, in Advisory Opinion 1984-29, the Commission said that a Senator could accept payments

for the travel expenses of his older daughter (who

functioned as an aide) and not count them as part

of the honorarium, but payments for the Senator's

infant daughter would be counted as part of the

honorarium.

Payments for agent's fees and commissions

are also not considered part of the honorarium.

11 CFR nn.no»,

The definition of an honorarium does not

include an award, a gift or a stipend. 11 CFR

110.12(c). An award is a gift of money or

anything of value given primarily in recognition of

some achievement. An award is based on an

established selection process and does not require

the recipient to take any action to compete for,

or to receive, the award. 11 CFR 1l0.12(c)(I).

For example, in AO 1975-85, a medal and a $5,000

prize received by a Senator in recognition of his

public service in the field of human rights was

considered an award -- not an honorarium. The

Senator was not required to make an appearance

or speech or prepare an article in order to receive

the prize.

A gift is a voluntary conveyance of real or

personal property which is made gratuitously and

is not supported by consideration. II CFR

1l0.12(c)(2). Neither an award nor a gift may be

made to serve in place of an honorarium or a

contribution.

A stipend is a payment for services on a

continuing basis. This includes payments by news

media for commentary on events other than the

campaign of the individual being compensated. 11

CFR 110.12(c)(3). In AO 1980-140, the Commission said that payments received by a Senator

for making periodic radio commentaries while

under contract to a production company were

stipends. In AO 1985-4, payments received by a

Senator for conducting seminars on government

and public affairs at a university were stipends,

not honoraria.

Honorarium for Article vs, Royalty for Book

Although compensation for an article is an

honorarium, compensation for a book -- a royalty -- is not. In AO 1978-59, the Commission said

that payments to a Senator for republication of

his works as articles were honoraria even though

the works were originally published in book form.

10

On the other hand, payments for works th

are republished in a book, regardless of th

original form, are not considered honoraria. 

AO 1979-78, the fee paid to a Senator for seria

zation of his book in a magazine was considered 

book royalty rather than an honorarium becau

the Senator's publisher negotiated the serializ

tion fee, received the fee from the magazine a

paid the Senator his percentage of the fee.

Honorarium vs. Contribution

It is important to understand the distincti

between a contribution and an honorarium. 

contribution is a gift, SUbscription, loan (oth

than by a qualified lending institution), advance 

deposit of money or anything of value made 

any person for the purpose of influencing 

election for federal office. 11 CFR 100.7(a)(

An honorarium, which is specifically exempt

from this definition (II CPR lOO.7(b)(I9»), is 

payment given in consideration for an appearan

speech or article. 11 CFR no.izu».

The Commission has recognized that fede

officeholders, who are also candidates for reele

tion, may receive lawful honoraria for non-ca

paign related appearances. (See AO 1984-29). 

AO 1978-32, the Commission said that, as 

general rule, the principal campaign committee 

an incumbent should regard a receipt as a cont

bution when the donor indicates, orally or 

writing, that the payment is for the purpose 

supporting the candidate's reelection and is not 

honorarium for the candidate's appearance as 

federal officeholder. When determining wheth

a receipt is a contribution or an honorarium, 

the facts and circumstances of a given situati

are relevant.

Reporting Requirements

Under the Federal Election Campaign A

candidates are not required to report the rece

of an honorarium. However, a candidate m

need to disclose honoraria under the provisions 

the Ethics in Government Act. For further d

tails on reporting honoraria, House candida

should contact:

Committee on Standards of Official Conduct

HT-2 Capitol Building

Washington, D.C. 20515

202/225-7103.

Senate candidates should contact:

The Select Committee on Ethics

220 Hart Senate Office Building

Washington, D.C. 20510

202(224-2981.

A corporation or a labor union that gives 

honorarium is not required, under the Fede

Election Campaign Act, to report that disbur

ment unless the honorarium is paid from its PA

(i.e, its separate segregated fund).
FEDERAL ELECTION COMMISSIOI\J

Conference Schedule

"The first day of the conference is for

registration and, in some cases, a reception.

Vdume 13, Numte

Madison, Wisconsin

FEC and Wisconsin

State Election Board

October 15-16 *

November 15-17 * Austin, Texas

FEC and Texas

Secretary of State

September 16-18* Burlington, Vermont

FEe and Vermont

Secretary of State

CONFERENCE SERIES REMINDER

The three Fall conferences on election

laws are proceeding on schedule. For more

information on the series, contact the

FEe's Information Services Division at:

~02/376-3120 or toll-free 800/424-9530.

800 LINE

After the election: winding down, 3:9

Personal financial reports, 5:7

Honoraria, 8:9

COURT CASES

FEC v, Americans for Jesse Jackson, 2:9; 8:9

FEe v ; Bank One, 7:5

FEC v, Beatty for Congress Committee, 3:6

FEC v, Citizens for the President '84,6:6

FEe v. Citizens Party, 1:8; 2:8

FEe v, Congressman Charles E. Rose, 2:7

FEe v; Ernest Halter and AIDS, 4:7

FEC v. Furgatch; FEe v. Dominelli, 3:5; 6:6

FEC v; John R. Clark, Jr., 2:8;

FEe v, Jolyn Robichaux, et at, 2:9

FEC v. Mark Barry, 4:7

FEC v, MCFL, 2:4

FEC v; NCPAC, 7:5

FEC v; Pryor for Congress Committee, 6:6

FEe v, Ted Haley Congressional Committee, 5:6

FEC v, 1984 Victory Fund, 3:6

Common Cause v: FEe (fourth suit), 2:6; fif

suit, 2:9

Congressman Stark v. FEC, 6:6

Furgatch v. FEC (second suit), 6:6

11

INDEX

In addition to the provisions of the Federal

Election Campaign Act and corresponding regulations, candidates and political committees should

consult Senate and House Rules and the Ethics in

Government Act.

This cumulative index lists advisory opinions,

court cases and 800 Line articles published in the

Record during 1987. The first number in the

citation refers to the "number" (month) of the

Record issue; the second number, following the

colon, indicates the page number in that issue.

OPINIONS

1986-37: Presidential candidate appearances at

convention of nonprofit corporation, 1:6

1986-38: Individual's financing of media ads to

promote conservative candidates, 1:7

1986-39: Excess campaign funds used to establish

trust fund for minor, 2:3

1986-40: Corporate donations to state party

committee's building fund, 2:3

1986-41: Trade association's plan to compensate

employees who make contributions, 2:4

1986-42: Affect of corporate reorganization on

PACs, 3:4

1986-44: Contributions to PAC matched with corporate donations to charity, 3:4

1986-45: Interest payments by his committee to

candidate, 4:4

1987-1: Campaign's compensation of lost wages to

candidate prohibited, 4:5

1987-2: Campaign's purchase of car for candidate's reelection and official duties, 4:5

1987-3: Refund for terminated Presidential campaign,4:6

1987-4: Excess campaign funds transferred from

individual's 1986 to his 1984 campaign, 5:4

1987-5: Solicitability of membership organization's members, 5:5

1987-6: Trade association PAC's combined dues

payment/solicitation plan prohibited, 5:5

1987-7: Voter guides distributed to public by

nonprofit corporation, 6:3

1987-8: Multimedia presentation of Presidential

interviews and profiles, 6:4

1987-11: Use of excess campaign funds, 8:2

1987-13: Trade association's solicitation of contributions, 8:2

1987-14: National Bank's SSP supporting only

state and local candidates, 8:3

1987-16: Transfers from state campaign committee to federal campaign committee, 8:3

1987-17: Combined membership dues and contribution on billing statement, 8:3

1987-18: PAC matches employee contributions

with commodity charitable donations, 8:4

August 1987
Official Business

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August 1987