June 2000 Federal Election Commission Volume 26, Number 6

Table of Contents

Regulations

1 Election Cycle Reporting

Reports

1 July Reporting Reminder

2 Nonfilers

3 Filing with Federal and State

Governments

3 Advisory Opinions

3 Federal Register

Audits

4 Missouri Democratic Party

6 Michigan Republican Party

Public Funding

7 Presidential Compliance Manual

7 April Matching Fund Payments

Court Cases

8 FEC v. Freedom’s Heritage Forum

8 FEC v. Heckman and Fund for

Conservative Majority

9 FEC v. Al Salvi for Senate

9 Hooker v. FEC

9 FEC v. National Rifle Association

9 FEC v. James Toledano

Publications

8 FEC Issues 1999 Annual Report

Outreach

10 Roundtables

10 Public Appearances

Compliance Regulations

1

 Please note that these changes do not

apply to unauthorized committees, and

the Commission does not expect to

modify the rules applicable to those

committees.

(continued on page 4)

Election Cycle Reporting

Proposed for Authorized

Committees

On April 27, 2000, the Commission approved a Notice of Proposed

Rulemaking (NPRM) that would

require candidate committees to

aggregate and report their receipts

and disbursements on an electioncycle basis rather than on a calendar-year basis, which is the current

system.

The proposed rules are based on

Public Law 106-58, passed by

Congress in 1999. The law requires

the Commission to implement these

new rules, beginning with the first

reporting period after December 31,

2000.

The change to election cycle

reporting is intended to simplify

recordkeeping and reporting.1

 Under

current regulations, candidate

committees track contribution limits

on a per-election basis, but report

contributions on a calendar-year-todate basis. Other receipts and

disbursements are aggregated and

Reports

July Reporting Reminder

Committees filing on a quarterly

basis must file their second quarterly report by July 15. Those filing

on a monthly schedule have a report

due on July 20.

Please note that, in addition to

filing quarterly reports, committees

of candidates active in 2000 primary

and runoff elections must file preelection reports and may have to file

48-hour notices. PACs and party

committees filing on a quarterly

basis may also have to file preelection reports.

Committees of candidates who

are not active in 2000 elections must

file a mid-year report by July 31.

For more information on 2000

reporting, including reporting dates

and when to file 48-hour notices,

see the reporting schedules in the

January and March 2000 Records.

To order the 2000 reporting schedule handout, call 800/424-9530 or

202/694-1100. Or use Faxline: 202/

501-3413 and request document

586. This information is also

available at the FEC’s Web page:

http://www.fec.gov/pages/report.htm.

Where to File Reports

With the exception of Senate

campaign committees and committees that support only Senate

(continued on page 3)
Federal Election Commission RECORD June 2000

2

Federal Election Commission

999 E Street, NW

Washington, DC 20463

800/424-9530

202/694-1100

202/501-3413 (FEC Faxline)

202/219-3336 (TDD for the

 hearing impaired)

800/877-8339 (FIRS)

Darryl R. Wold, Chairman

Danny L. McDonald,

 Vice Chairman

Lee Ann Elliott, Commissioner

David M. Mason, Commissioner

Karl J. Sandstrom, Commissioner

Scott E. Thomas, Commissioner

James A. Pehrkon, Staff Director

Lawrence M. Noble, General

 Counsel

Published by the Information

 Division

Louise D. Wides, Director

Greg J. Scott, Editor

http://www.fec.gov

Nonfilers

The campaign committees listed

in the top chart failed to file preprimary reports in connection with

the May 2 primary elections in

Indiana and North Carolina. The

reports, which were due April 20,

were to include financial activity for

the period April 1 - 12.

The second chart lists campaign

committees that failed to file preprimary reports in connection with

the May 23 primary elections in

Arkansas, Idaho and Kentucky. The

reports covered the period April 1 -

May 3, and were due May 11.

The bottom chart lists campaign

committees that failed to file reports

covering the first quarter of calendar

year 2000. The reports were due

April 15.

The FEC is required by law to

publicize the names of nonfiling

campaign committees. 2 U.S.C.

438(a)(7). The agency pursues

enforcement action against nonfilers

on a case-by-case basis.✦

IN and NC Pre-primary Report Nonfilers:

Candidate Office Sought

Ron Gyure for Congress House IN/02

Ward for Congress House NC/04

Coble for Congress House NC/06

Mike Taylor for Congress House NC/08

Clement for Congress House NC/09

Cass Ballenger for Congress Committee House NC/10

Mel Watt for Congress Committee House NC/12

AR, ID and KY Pre-Primary Nonfilers:

Candidate Office Sought

Jason Sutfin for Congress House AR/01

Rod Martin for Congress House AR/02

Linda Pall Congress 2000 House ID/01

Don Bell for Congress/2000 House KY/04

Quarterly Report Nonfilers:

Candidate Office Sought

Judy Smith for Congress House AR/04

People for Royal Hart House PA/04

Dick Stewart for Congress House PA/19

People for Bellissimo House PA/04

Administrative Fines Program Begins in July

Beginning with the July reports, the Commission will implement an

Administrative Fines program for late filing committees. For more

information, see the May Record, p. 1, and watch for further details in the July

Record.
June 2000 Federal Election Commission RECORD

3

Filing with Federal and State Governments

Type of Committee

U.S. Senate Campaigns Secretary of the Senate Yes

U.S. House and FEC Yes, unless waived*

Presidential Campaigns

PACs and Parties FEC Yes, unless waived*

PACs Supporting Only Secretary of the Senate Yes

U.S. Senate Candidates

*

 The Commission has certified that the following states and territories qualify for

filing waivers: Alabama, American Samoa, Arkansas, California, Colorado,

Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky,

Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina,

North Dakota, Ohio, Oklahoma, Oregon , Pennsylvania, Rhode Island, South

Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Virgin Islands,

Washington, West Virginia, Wisconsin and Wyoming. Committees that file their

reports at the FEC need not file copies in these states.

Note, also, that 11 CFR 108.8 exempts the District of Columbia from the state filing

requirement.

Federal Government:

Where to File

State Government:

Is Copy Required? candidates, all committees file their

reports with the Federal Election

Commission. (Reports should never

be filed with the Clerk of the House.)

Senate campaign committees

continue to file their reports with the

Secretary of the Senate.

State Copies of Reports Waived in

Most States

Due to a new state waiver

program, most committees no

longer have to file copies of their

FEC reports at the state level. Under

this new program, committees based

in, or supporting candidates in, 45

states/territories no longer have to

file copies of their reports with the

state because these states have

qualified for the FEC’s waiver. (See

the footnote in the chart (to the

right) for a list of the states/territories that have qualified for the

waiver.) The Commission has

granted waivers to these states and

territories because they give the

public access to FEC reports

through a computer located at their

campaign finance records office.

Note, however, for the present

time, the waiver does not apply to

reports filed by Senate campaign

committees. They must continue to

file copies of their reports with the

state. (Images of Senate reports will

soon be available on the

Commission’s Web site. Once this

occurs, Senate campaigns will be able

to take advantage of the state filing

waivers. Senate campaign filers

should check the FEC’s Web site or

consult their Reports Analyst for the

most up-to-date information.)

Consult the chart (above right) for

guidance on where to file FEC reports.

Administrative Fines

Starting with the July reports, late

filers, nonfilers and committees that

fail to file 48-hour notices will be

subject to administrative fines,

ranging from $125 to $16,000. Read

more about the new program in the

upcoming July issue of the Record.✦

Reports

(continued from page 1)

Federal Register

Federal Register notices are

available from the FEC’s Public

Records Office.

Notice 2000-6

Administrative Fines; Notice of

Proposed Rulemaking (65 FR

16534, March 29, 2000)

Notice 2000-7

Electronic Filing of Reports by

Political Committees; Notice of

Proposed Rulemaking (65 FR

19339, April 11, 2000)

Notice 2000-8

Public Financing of Presidential

Primary and General Election

Candidates; Final Rule;

Announcement of Effective Date

(65 FR 20893, April 19, 2000)

Notice 2000-9

Election Cycle Reporting by

Authorized Committees, Notice

of Proposed Rulemaking (65 FR

25672, May 3, 2000)

Advisory

Opinions

Advisory Opinion Requests

AOR 2000-9

Application of FEC regulations

and advisory opinions to commercial Web site that sells space to

federal, state and local candidates

and issue organizations. (Voter.com,

Inc., May 2, 2000)

AOR 2000-10

Trade association PAC’s use of

Web site to request prior approval

from corporate members.

(America’s Community Bankers

PAC, May 15, 2000)

AOR 2000-11

Reissue of corporate checks for

PAC contributions made through

employee payroll deduction to

replace original checks that PAC

treasurer never deposited. (GeorgiaPacific Corporation, May 15, 2000)
Federal Election Commission RECORD June 2000

4

reported on a calendar-year-to-date

basis. Under the proposed new

rules, authorized candidate committees will itemize and report contributions, other receipts and

disbursements on an election-cycle

basis.

Under current regulations, an

election cycle begins the day after

the general election for the office or

seat that the candidate seeks and

ends on the day of the next general

election for that seat or office. 11

CFR 100.3(b). The length of the

election cycle depends on the office

sought—a two-year cycle for House

candidates, six years for Senate

candidates and four years for

Presidential candidates. Campaign

finance reports are due monthly or

quarterly, depending on the committee, with a pre- and post-election

report, and a year-end report due on

January 31 of the following year.

Under this definition of election

cycle, either the post-general

election report or the year-end

report (for authorized candidate

committees not required to file a

post-election report) covers two

election cycles.

The Commission seeks comments

on two alternatives to this definition

of election cycle, neither of which is

actually included in the proposed

rules. Under the first alternative, for

reporting purposes only, the election

cycle would begin on January 1 of

the year following the general

election for a seat or office and

would end on December 31 of the

calendar year in which the next

general election for that seat or

office is held. This approach would

require fewer changes to current

reporting practices and would avoid

the need to include separate election-cycle-to-date figures for two

different election cycles in postgeneral reports (or year-end reports

where no post-general report is

filed). However, under this alternative, post-general-election contribuRegulations

(continued from page 1)

tions received before January 1

would be included in the current

election cycle totals, even though

these contributions might count

toward the limits for a different

election.

Under the second alternative,

which would apply to both reporting

and contribution limits, the election

cycle would begin on the 21st day

after the general election for the seat

or office the candidate is seeking

(the day after the end of the postgeneral election reporting period)

and would end on the 20th day after

the next general election for the seat

or office the candidate is seeking

(the day the post-general reporting

period ends for that election). In

addition, this alternative would

amend the regulations at 11 CFR

110.1 and 110.2 to extend the cutoff date for attributing undesignated

contributions. Under current rules,

undesignated contributions made

after the general election count

toward the next upcoming election.

Under this alternative, undesignated

contributions made through 20 days

after the general election would

continue to be attributed to the

recently held general election. As a

result, the post-general election

report would not cover two election

cycles. However, year-end reports

filed by candidates who do not

participate in the general election

(and therefore do not file a postgeneral election report) would cover

the entire post-election period

through December 31 and, thus, two

election cycles.

Certain changes to FEC Forms 3

and 3P (used by House and Senate

campaigns and by Presidential

campaigns, respectively) will be

necessary under any of the three

alternative approaches. For example, in instances where a single

report (either the post-general or

year-end) covers financial activity

from two election cycles, the

Commission seeks comments on

how best to segregate that activity

on the reporting form.

Audit of Missouri

Democratic Party

An FEC audit of the Missouri

Democratic Party, approved by the

Commission on April 5, 2000,

found that the committee improperly

allocated federal and nonfederal

expenses, misreported the proceeds

of joint fundraisers and received

excessive contributions.

Federal/Nonfederal Allocation

The audit identified $223,458 in

payments from the party’s

nonfederal account that should have

been allocated between the

committee’s federal and nonfederal

accounts. The disbursements were

for administrative and generic voter

drive expenses such as contract

services, travel reimbursements,

salaries, bonuses, printing and voter

registration. Based on the applicable

allocation ratio (22 percent federal

and 78 percent nonfederal), the

party should have paid $49,161 of

these expenses with funds from its

federal account. Furthermore, based

on the FEC’s allocation regulations,

the party should have made the

original payments to vendors from

its federal account and transferred

funds from the nonfederal account

to the federal account to cover the

nonfederal share of the expenses. 11

CFR 106.5(g).

Allocating Refunds and Rebates

The committee also erroneously

deposited into its federal account

$39,584 in refunds and rebates

related to shared federal/nonfederal

expenses. The party failed to

transfer the nonfederal share of

those refunds and rebates ($30,662)

to its nonfederal account. The party

did not provide evidence to refute

these findings.

Audits

(continued on page 6)
June 2000 Federal Election Commission RECORD

5

Since the new regulations will

take effect after the post-general and

year-end reporting periods for 2000

have closed, many candidates will

have already reported receipts and

disbursements related to the 2002,

2004 or 2006 election cycles. To

account for this, the Commission is

creating a one-time worksheet to

help these campaigns aggregate

their election-cycle-to-date figures.

In addition to the changes

directly related to election cycle

reporting, the NPRM also proposes

conforming amendments to the

Commission’s “best efforts” regulations at 11 CFR 104.7. These

amendments would replace references to the $200 per calendar year

itemization threshold with a $200

per election cycle threshold.

The NPRM is available from the

Public Records Office at 800/424-

9530 (press 3) or 202/694-1120;

through the FEC’s Faxline at 202/

501-3413 (document 248); and on

the FEC’s Web site—http://

www.fec.gov. The notice was

published in the Federal Register on

May 3 (65 FR 25672, May 3, 2000).

The Commission seeks comments

on the proposed revisions to 11 CFR

104.3, 104.7, 104.8 and 104.9, on

the alternative definitions of election

cycle discussed above, and on any

other issues raised by the new

statutory requirements regarding

election cycle reporting. All comments should be addressed to

Rosemary C. Smith, Assistant

General Counsel, and must be

submitted in either written or

electronic form. Written comments

should be sent to the Federal

Election Commission, 999 E Street,

N.W., Washington, D.C. 20463.

Faxed comments should be sent to

202/219-3923, with a printed copy

follow-up to ensure legibility.

Electronic mail comments should be

sent to ecyclereport@fec.gov. Those

sending comments by electronic

mail must include their full name,

electronic mail address and postal

service address within the text of

their comments. Comments that do

not contain the full name, electronic

mail address and postal service

address of the commenter will not

be considered. No oral comments

can be accepted. The deadline for

comments is June 2, 2000.✦

November

Election

November

Election

Jan. 1 Dec. 31 Dec. 31

November

Election

November

Election

Jan. 1 Dec. 31 Dec. 31

November

Election

November

Election

Jan. 1 Dec. 31 Dec. 31

Close of Books

Post-General Report

Close of Books

Post-General Report

Election Cycle for Congressional Candidates

Current Definition of Election Cycle:

Alternative 1:

Alternative 2:*

* Note that this alternative would also amend the contribution aggregation rules at 11 CFR 110.1 and 110.2.
Federal Election Commission RECORD June 2000

6

Audits

(continued from page 4)

Joint Fundraising

The party participated in three

joint fundraisers from which it

received $150,582 in net proceeds.

The committee disclosed these net

receipts on it FEC reports, but failed

in some cases to itemize the individual contributions included in its

share of the gross proceeds from the

fundraisers. Nor did it maintain

proper records with respect to the

fundraisers. In response to the

interim audit report, however, the

committee filed the required memo

Schedules A, itemizing the contributions, and provided copies of the

necessary records.

Excessive Contributions

The audit identified 18 excessive

contributions totaling $80,250. The

committee transferred nine of the

contributions to its nonfederal

account, and reattributed four others

to spouses. The committee did not,

however, provide evidence that it

had:

•Informed contributors that it had

transferred their funds to the

nonfederal account;

•Informed the contributors of their

option to receive refunds; or

•Retained the donors’ authorization

to reattribute their contributions to

spouses. 11 CFR 110.1(b),

110.1(k) and 110.2(b).

In response to the Commission’s

interim audit report, the committee

refunded three contributions totaling

$25,250, received authorization to

transfer or reattribute 13 others, and

took no action on the two remaining

excessive contributions identified in

the audit. However, since the

committee did not receive the

authorizations to transfer or

reattribute the contributions within

60 days of the treasurer’s initial

receipt of the contributions (as

required by FEC regulations), that

option was not available to the

committee.

This audit was conducted pursuant to 2 U.S.C. 438(b), which

authorizes the Commission to

conduct audits of any political

committee that fails to meet the

threshold level of compliance set by

the Commission. Subsequent to a

final audit report, the FEC may

choose to pursue unresolved issues

in an enforcement matter.✦

Audit of Michigan

Republican Party

An FEC audit of the Michigan

Republican State Committee

(MRSC), approved on April 13,

2000, revealed possible impermissible expenditures on behalf of

federal candidates, shared federal/

nonfederal (allocable) expenses

erroneously paid from nonfederal

accounts, misstatements of financial

activity and reporting errors and

omissions.

Impermissible Expenditures

MRSC used its salaried staff to

operate a get-out-the-vote phone

bank on behalf of the 1996 Presidential and Vice Presidential

nominees and three nonfederal

candidates. Because MRSC used

salaried staff, rather than volunteers,

the phone bank did not qualify for

the regulatory exception that permits

a state or local party committee to

finance a volunteer-operated phone

bank on behalf of Presidential and

Vice Presidential nominees without

considering its payments expenditures. 11 CFR 100.8(b)(18)(v).

Instead, the audit concluded that the

party had made a $5,794 contribution to or independent expenditure

on behalf of Dole/Kemp ’96. MRSC

neither accepted nor refuted this

finding.

Shared Federal/Nonfederal

Expenses

MRSC used an “administrative

account,” which was a nonfederal

account, to defray certain expenses

that it considered to be non-campaign related. The party did not

disclose the receipts and disbursements of this account on its federal

or state disclosure reports. The audit

identified approximately $413,573

in expenses that the party paid from

this “administrative account” that

should have been allocated between

its federal and nonfederal accounts.

11 CFR 106.5. These expenses

related to the State Convention,

State Committee meetings, Republican National Committee meetings/

conferences, as well as the day-today operations of MRSC.

Similarly, MRSC’s “Republican

National Convention” account—

also a nonfederal account—paid

$78,538 in apparent allocable

expenses associated with the 1996

Presidential nominating convention,

and its nonfederal “operating

account” paid $10,951 for allocable

get-out-the-vote activity.

In light of these findings, the

interim audit report recommended

that MRSC transfer $183,353 from

its federal account to its nonfederal

accounts to pay for the federal share

of the allocable expenses and file

memo Schedules H4 to disclose the

activity.

In response, MRSC reimbursed

its nonfederal account $21,402 for

the federal share of expenses it

acknowledged were allocable. The

party also demonstrated that $7,173

of the alleged allocable expenses

identified in the audit were solely

nonfederal. MRSC further contended that payments from its

convention account were for social

functions that did not relate to

federal elections.

Ultimately, the final audit report

concluded that MRSC should

transfer $154,778 from its federal

account to its nonfederal account

to cover the federal share of

allocable expenses. This figure took

into account the $21,402 transfer the

party had already made and the

$7,173 in expenses that were solely

nonfederal.
June 2000 Federal Election Commission RECORD

7

Misstatement of Financial Activity

A comparison of MRSC’s

reported activity to its bank records

revealed misstatements of beginning

cash, total receipts and total disbursements disclosed on the

committee’s 1995 and 1996 reports.

In response to the interim audit

report, MRSC filed amended reports

to correct the misstatements.

Reporting Errors and Omissions

MRSC’s reports contained a

number of errors and omissions.

Among the errors, the committee

failed to itemize and report:

•Payroll disbursements of $284,919

(and related transfers from the

nonfederal account to the federal

account) on Schedules H3 and H4;

•Transfers of $634,239 from the

nonfederal operating account to the

federal allocation account for the

nonfederal share of payments to

vendors;

•Bank charges and disbursements to

vendors totaling $756,462;

•Transfers of $13,500 to the

nonfederal account; and

•An $80,842 independent expenditure on behalf of a federal candidate.

In response, MRSC filed all

schedules as recommended.✦

Public Funding

April Matching Fund

Payments

On April 28, 2000, the Commission approved an additional

$5,415,234.76 in matching fund

payments to seven Presidential

candidates. With these latest certifications, the FEC has now declared

nine candidates eligible to receive a

total of $54,514,698.57 in federal

matching funds for the 2000 election.

Due to a shortfall in the Presidential Election Campaign Fund, the

U.S. Treasury Department has been

making partial payments to the

qualified candidates, based on the

Commission’s certifications. The

chart below lists the most recent

certifications and cumulative

payments for each candidate.✦

Presidential Compliance

Manual Available

The 2000 edition of the Financial

Control and Compliance Manual for

Presidential Primary Candidates

Receiving Public Financing is now

available. The manual helps publicly funded Presidential campaigns

manage their accounting, reporting

and recordkeeping, in compliance

with the federal election laws.

Matching Funds for 2000 Presidential Candidates:

April Certification

Candidate Certification Cumulative

 March 2000 Certifications

Gary L. Bauer (R) 1 $ 68,422.52 $ 4,618,611.55

Bill Bradley (D) 2 $ 277,762.50 $12,390,505.77

Patrick J. Buchanan (Reform) $ 117,809.16 $ 3,447,936.19

Al Gore (D) $ 996,715.38 $14,122,762.38

John Hagelin (Natural Law) $ 134,910.00 $ 234,910.00

Alan L. Keyes (R)3 $ 359,607.58 $ 2,592,093.75

Lyndon H. LaRouche, Jr. (D) 4 $0.00 $901,338.93

John S. McCain (R) 5 $3,360,007.62 $14,004,015.00

Dan Quayle(R) 6 $0.00 $2,102,525.00

1 Gary L Bauer publicly withdrew from the race on February 4, 2000.

2 Bill Bradley publicly withdrew from the race on March 9, 2000.

3 Alan L. Keyes became ineligible for matching funds on April 20, 2000.

4

 Lyndon H. LaRouche, Jr. became ineligible for matching funds on April 6, 2000.

5 John S. McCain publicly withdrew on March 9, 2000.

6 Dan Quayle publicly withdrew from the race on September 27, 1999.

The manual includes the

Commission’s revised “Computerized Magnetic Media Requirements

for Title 26 Candidates/Committees

Receiving Federal Funding”

(CMMR). The CMMR sets forth

technical standards designed to

ensure the compatibility of magnetic

media, provided for Commission

use during the matching fund

submission process, and mandatory

audits of these publicly funded

campaign committees.

Copies of the manual are available from the FEC’s Public Records

office at 800/424-9530 (press 3) or

202/694-1120. The manual is also

available on the Commission’s Web

site, as a PDF file, at http://

www.fec.gov/pdf/

Compliance2000.pdf.✦
Federal Election Commission RECORD June 2000

8

Court Cases

FEC v. Freedom’s Heritage

Forum

On April 28, 2000, the U.S.

District Court for the Western

District of Kentucky granted in part

and denied in part the Freedom’s

Heritage Forum’s motion to dismiss

certain portions of the FEC’s

complaint against it.

Background

The Forum, a political committee

that promotes pro-life and other

social issues, made expenditures in

connection with the planning and

holding of a political meeting and

the mailing of several political

flyers during the 1994 Republican

primary in Kentucky.

In its complaint, the Commission

alleged that the Forum had violated

sections §§441(a)(1)(A), 434(b) and

441d(a) of the Federal Election

Campaign Act (the Act) by making

excessive contributions, failing to

report contributions and failing to

include disclaimers on its communications. Specifically, the Commission maintained that the Forum had

made coordinated expenditures

(which are considered in-kind

contributions) on behalf of a federal

candidate that exceeded the Act’s

contribution limits, and that the

Forum had distributed communications (seven flyers) containing

express advocacy without the

required disclaimers.

On September 29, 1999, the court

ruled that the Forum’s expenditures

were permissible independent

expenditures—not coordinated

expenditures (not contributions).

The court also maintained that only

one of the four flyers it reviewed

(exhibit 2) contained express

advocacy and, thereby, required a

disclaimer. For a summary of the

decision, see the December 1999

Record, p. 6.

the statement was merely a “comment on the status of the election,”

not express advocacy.

Civil Action No. 3:98CV-549-S,

U.S. District Court for the Western

District of Kentucky at Louisville,

April 28, 2000.✦

On February 4, 2000, the Ccourt

denied an FEC motion to reconsider

its decision with respect to express

advocacy and disclaimers.

Current Decision:

Express Advocacy

The court’s most recent decision

relates to the Forum’s motion to

dismiss Count VII of the

Commission’s Second Amended

Complaint. In Count VII, the FEC

had alleged that seven flyers the

Forum had distributed in connection

with the 1994 elections—including

the four on which the court had

already ruled—contained express

advocacy, but lacked the disclaimers

required by 2 U.S.C. §441d(a).

Having already ruled on four of

the flyers, the court concluded that

two of the three remaining flyers

contained express advocacy and

should have had disclaimers.

The first of them was a “Congressional Candidate Report” that

compared one candidate’s positions

on certain issues to those of his

opponents. It contained in a highlighted box: “IMPORTANT!

Registered Democrats and Republicans can vote for [the named

candidate] who actively opposes the

liberal Clinton agenda. Vote November 8, 1994, 6 a.m. to 6 p.m.”

The court found that this statement

was an exhortation to vote for the

named candidate and therefore was

express advocacy.

The second express advocacy

flyer was a sample ballot that

readers were to take to the polls on

election day. It “explicitly urge[d]

the reader to vote for the ‘profamily’ candidates identified.”

The other flyer was an invitation

that included the statement: “We

have the Pro-Abortionists right

where we want them, divided and

fighting each other. Now [the named

candidate] can win with only 40%

of the vote!” Because the flyer

lacked Lacking an explicit exhortation to vote, the court concluded that

FEC v. Heckman and Fund

for a Conservative Majority

On April 28, 2000, the U.S.

District Court for the Eastern

District of Virginia granted the

FEC’s motion to hold Robert

Heckman and Fund for a Conservative Majority (FCM) in contempt of

court for failing to pay a courtimposed civil penalty and for failing

to file disclosure reports, as the

court had ordered.

The court ordered Mr. Heckman

and FCM to pay the outstanding

civil penalty plus interest (amounting to $5,540); to pay a $5,000

contempt fine; and to file all outstanding disclosure reports. If Mr.

Heckman and FCM fail to comply

with the court’s orders within 10

days, the court will impose additional contempt fines of $100 per

day until they do so.

FEC Issues 1999

Annual Report

The FEC’s Annual Report 1999

is now available. The report describes the agency’s actions during the last calendar year and includes the package of legislative

recommendations the Commission recently transmitted to the

President and Congress.

Free copies of are available by

calling the FEC’s Information Division at 800/424-9530 or 202/

694-1100. It is also available

through the FEC’s Web site at

http://www.fec.gov/pdf/ar99.pdf.
June 2000 Federal Election Commission RECORD

9

FEC v. Al Salvi for Senate

Committee

On March 8, 2000, the U.S. Court

of Appeals for the Seventh Circuit

affirmed a district court order

dismissing a civil enforcement

action the FEC had brought against

the Al Salvi for Senate Committee

and its treasurer.

In its original suit, filed on March

3, 1998, the Commission had asked

the U.S. District Court for the

Northern District of Illinois to find

that the Salvi committee had

misreported and failed to report in a

timely manner more than $1.1

million in contributions and loans.

(See the April 1998 Record, p. 4.)

The district court dismissed the

case on technical grounds: The court

held that the FEC had failed to

obtain local counsel to process

papers and handle emergencies.1

The Commission refiled the suit. On

November 30, 1998, the district

court dismissed the Commission’s

second suit because it was identical

Hooker v. FEC (3-99-0794)

On April 12, 2000, the U.S.

District Court for the Middle

District of Tennessee granted the

FEC’s motion to dismiss John Jay

Hooker’s constitutional challenges

concerning interstate campaign

contributions and the Presidential

Primary Matching Payment Act.

Mr. Hooker had alleged that the

Federal Election Campaign Act

preempts state laws that prohibit

interstate campaign contributions,

which he believes are unconstitutional. The court barred this challenge because Mr. Hooker had

raised and litigated the same issue in

prior cases that were dismissed.

Mr. Hooker had also contended

that the Presidential Primary Matching Payment Act was unconstitutional because Congress lacked the

power to enact it and because it

violated the Guarantee Clause of the

Constitution. The court dismissed

this challenge for lack of standing.

For more information, see page 5

of the October 1999 Record..

Case No. 3-99-0794, U.S. District

Court for the Middle District of

Tennessee, Nashville Division,

April 12, 2000.✦

1

 The Commission has had a longstanding policy of asking courts to

waive the requirement to use local

counsel when the agency is involved in

cases outside the Washington, DC,

area. Rather than relying on a local

U.S. attorney (with the U.S. Department

of Justice), the Commission has

preferred to provide its own counsel in

an effort to ensure the agency’s

complete independence. In the vast

majority of cases, district court judges

have routinely waived the requirement

to use local counsel. In this case, the

judge chose not to grant the

Commission’s request for the waiver. (continued on page 10)

For more information, see the

Record, January 1997, p. 5, and

November 1997, p. 1.

Civil Action No. 96-1567-A, U.S.

District Court for the Eastern

District of Virginia, Alexandria

Division, April 28, 2000.✦

to the first, which the court had

dismissed with prejudice.

After learning that the court’s

initial dismissal had been with

prejudice, the Commission filed

motions to vacate that dismissal and

thereby permit consideration of the

second suit, and to alter or amend

the court’s judgment in the second

suit. Both motions were denied, and

the Commission filed an appeal.

The appeals court affirmed the

district court’s decisions.

U.S. Court of Appeals for the

Seventh Circuit, 99-1508 and 99-

2183.✦

FEC v. NRA (85-1018)

On April 3, 2000, the U.S.

District Court for the District of

Columbia ordered the National Rifle

Association (NRA) and its lobbying

organization, the NRA America

Institute for Legal Action, to pay a

$25,000 civil penalty for violating

the ban on corporate contributions

and expenditures. 2 U.S.C.

§441b(a). The court levied an

identical penalty against the NRA

Political Victory Fund, the NRA’s

political action committee.

The violations related to the use

of corporate funds for electioneering

activities in connection with federal

elections in 1978, 1980 and 1982.

Specifically, the NRA and its

lobbying arm, the NRA Institute for

Legislative Action, spent treasury

funds to support federal candidates

and were subsequently reimbursed

by the NRA Political Victory Fund.

On April 24, 2000, the NRA

appealed the district court’s decision

to the U.S. Court of Appeals for the

District of Columbia Circuit.

Case No. 85-1018 (JGP), U.S.

District Court for the District of

Columbia, April 3, 2000.✦

New Litigation

FEC v. James Toledano

On April 17, 2000, the FEC filed

suit asking the U.S. District Court

for the Central District of California

to find that James Toledano, former

Chair of the Orange County Democratic Central Committee (Orange

County Party), violated 2 U.S.C.

§432(b) by failing to forward two

$5,000 contributions to the treasurer

of the Orange County Party within

10 days after receiving them.

The contributions in question

were made by Debra and Paul

LaPrade in early 1996. At the time,

Ms. LaPrade’s brother, James M.

Prince, was a candidate for the
Federal Election Commission RECORD June 2000

10

Public Appearances

June 1, 2000

Investigative Reporters and

Editors

New York, New York

Bob Biersack

June 2, 2000

The Urban Institute

Washington, D.C.

Commissioner Mason

Commissioner Thomas

Louise Wides

June 2, 2000

Campaigns for People

Austin, Texas

Bob Biersack

Date Subject Intended Audience

Roundtable Schedule

August 2 Update on New and Proposed • PACs

9:30 - 11 a.m. FEC Filing Regulations • House and Senate

• State Filing Waiver Campaigns

• Mandatory Electronic Filing • Political Party

• Administrative Fines Committees

for Reporting Violations • Lawyers, Accountants

• Election Cycle Reporting and Consultants to

Above

June 7 Partner/Partnership • Partnerships

9:30 - 11 a.m. Federal Election Activity • Lawyers, Accountants

and Consultants to

Above

FEC Roundtables

The Commission will host

roundtable sessions in June and

August.

FEC roundtables, limited to 12

participants per session, focus on a

range of subjects. See the table for

dates and topics. All roundtables are

conducted at the FEC’s headquarters

in Washington, DC.

Registration is $25 and will be

accepted on a first-come, firstserved basis. Please call the FEC

before registering or sending money

to be sure that openings remain in

the session of your choice. Prepayment is required. The registration

form is available at the FEC’s Web

site—http://www.fec.gov—and

from Faxline, the FEC’s automated

fax system (202/501-3413, request

document 590). For more information, call 800/424-9530 (press 1,

then 3) or 202/694-1100.✦

Outreach

Court Cases

(continued from page 9)

Democratic nomination for Congress in California’s 46th congressional district.

The LaPrades, who had already

given the maximum to the Prince

campaign, contributed to the Orange

County Party. Upon receipt of the

funds, Mr. Toledano opened a new

bank account in the name of the

party, with only his own signature

required for withdrawals, and

deposited the LaPrades’ $10,000

check into the account. He then

spent the money to finance a slate

mailer that advertised the California

Democratic Party’s endorsement of

Mr. Prince.

Unaware of the contributions and

expenditures, the Orange County

Party’s treasurer was unable to

fulfill the Orange County Party’s

registration and reporting obligations under the federal election law.

The treasurer learned of the

LaPrades’ contributions and the

existence of the new bank account

only one day before the primary.

The Commission learned of Mr.

Toledano’s actions through a letter

sent by the Orange County Party

itself, and a complaint filed by

another individual. After finding

probable cause to believe that Mr.

Toledano had violated §432(b), the

Commission attempted, but failed,

to reach a conciliation agreement

with him.1

 Unable to resolve the

matter, the Commission voted to

authorize this suit.

SACV-00-376-DOC (ANx), U.S.

District Court for the Central

District of California (Southern

Division), April 17, 2000.✦

1

 In MURs 4389 and 4652, both related

to this case, the LaPrades (the contributors) and the Prince for Congress

Committee entered into conciliation

agreements with the Commission.
June 2000 Federal Election Commission RECORD

11

Index

The first number in each citation

refers to the “number” (month) of

the 2000 Record issue in which the

article appeared. The second

number, following the colon,

indicates the page number in that

issue. For example, “3:4” means

that the article is in the March issue

on page 4.

Advisory Opinions

1999-24: Web site sponsored by

LLC featuring information on

candidates, 1:17

1999-29: Fundraising exemption

from state limits for direct mailing

by Presidential committee, 1:19

1999-30: Application of allocation

ratio in state with single house

legislature, 1:20

1999-31: Application of one-third

rule to prizes and premiums used

in connection with payroll

deduction, 1:21

1999-32: Indian tribe’s utility

authority treated as separate from

the tribe, 3:4

1999-33: Delayed transmittal of

payroll deductions, 3:5

1999-34: Use of campaign funds to

finance charity event, 2:2

1999-35: Soliciting for SSF through

electronic deduction system, 2:4

1999-36: Fundraising via electronic

checks and Internet fund transfers,

3:5

1999-37: PAC distribution of

express advocacy communications through Web site and email, 4:1

1999-39: Disaffiliation of SSFs after

corporate restructuring, 4:5

1999-40: Solicitation of members of

rural electric cooperatives, 5:6

2000-1: Paid leave of absence for

attorney seeking federal office,

4:5

2000-2: Campaign rental of candidate-owned office, 5:7

2000-3: PAC’s payment for corporate communication, 5:8

2000-4: Automatic Deductions for

credit union PAC, 5:8

Compliance

MUR 3774: Failure to allocate

expenses between federal and

nonfederal accounts for get-outthe-vote drive conducted by third

party, 3:3

MUR 4322 and 4650: Violations by

candidate, campaign committees,

treasurer and relative, 2:1

MUR 4648: Failure to disclose

purpose of expenditures and other

violations, 3:4

Court Cases

_____ v. FEC

– Christine Beaumont, et al., 3:9

– DNC, 4:6

– DSCC, 1:2

– Hooker, John Jay, 6:9

– Virginia Society for Human Life,

Inc., 3:8

FEC v. _____

– Christian Coalition, 4:7

– Freedom’s Heritage Forum, 6:8

– Friend for Fasi, 3:9

– Fund for Conservative Majority

(Heckman), 6:8

– National Rifle Association, 6:9

– Salvi for Senate Committee, 6:9

– Toledano, James, 6:9

Other

– Fireman v. USA, 1:13

– Mariani v. USA, 1:3

– Reform Party v. Gargan, 5:9

– Shrink PAC v. Nixon, 3:7

Regulations

Administrative Fines, 5:1

Coordination, 1:14; 4:3

Election Cycle Reporting, 6:1

Electronic Filing, 5:1

Electronic Freedom of Information

Act, 4:1

Express Advocacy, 4:2

Presidential Public Funding, 5:3

Repayments by Federally Financed

Presidential Primary Campaign

Committees, 4:2

State Waivers, 4:3

Reports

Reports due in 2000, 1:5

Reports due in July, 6:1

State Filing Waiver, 1:2; 2:5, 4:3,

5:5, 6:3

Virginia Convention Reports, 5:5
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Federal Election Commission RECORD June 2000