February 2003 Federal Election Commission Volume 29, Number 2

Table of Contents

Regulations

1 Clarifying Application of Biennial

Limit

2 Interim Final Rules on the

Millionaires’ Amendment

4 Brokerage Loans and Lines of

Credit, Effective Date

4 Notice of Proposed Rulemaking

on Leadership PACs

6 Contribution Limits and

Prohibitions; Correction

6 BCRA Technical Amendments

6 Federal Register

Compliance

1 MUR 5208: Facilitation of

Contributions by National Bank

Court Cases

8 FEC v. Freedom’s Heritage Forum

8 Lenora B. Fulani v. FEC

8 Advisory Opinions

Audits

10 Presidential Audits for 2000

Alternative Dispute Resolution

11 ADR Update

Statistics

12 Congressional Activity Declines

from 2000 Levels

Administrative Fines

13 Committees Fined for Late and

Nonfiled Reports

Outreach

14 Spring Conferences

14 Public Appearances

14 Roundtables

MUR 5208

Facilitation of Contributions

by National Bank

The Commission recently entered

into conciliation agreements with

Amboy National Bank (Amboy), its

President and Board of Directors

Chairman, George Scharpf, and

Jersey Bankers Political Action

Committee (JebPAC), resulting in

$86,000 in civil penalties. The

conciliation agreements settle

violations of the Federal Election

Campaign Act (the Act) resulting

from Amboy’s and Mr. Scharpf’s

facilitation of the making of contributions and from Amboy’s and

JebPAC’s failure to include the

required notices on solicitations.

Facilitation

The Act prohibits a national

bank, such as Amboy, from making

contributions “in connection with

any election to any political office,

or in connection with any primary

election or political convention or

caucus held to select candidates for

any political office.” It is also

unlawful for any officer or director

of a national bank to consent to any

contribution by the bank. 2 U.S.C.

§441b(a). While it may communiCompliance Regulations

(continued on page 7) (continued on page 2)

Clarifying Application of

Biennial Limit

The Commission wishes to

clarify the application of the new

$95,000 biennial limit for individuals as it pertains to contributions to

federal candidates.

The Bipartisan Campaign Reform

Act of 2002 (BCRA) removed

language at 2 U.S.C. §441a(a)(3)

that described how a contribution to

a candidate’s committee affected an

individual’s overall limit on contributions. The pre-BCRA statutory

language required that contributions

to a candidate be applied toward the

individual donor’s overall limit for

the year of the candidate’s election,

regardless of when the contribution

was made. Despite the BCRAenacted change, this language

remains in the corresponding

Commission regulation at 11 CFR

110.5(c).

While the Commission may

revisit this issue as part of a future

rulemaking, individual donors must

abide by the current regulations.

Individuals who make contributions

now to federal candidates running in

a future election cycle (e.g., 2005-

06) must count those contributions

against the biennial limit for that
Federal Election Commission RECORD February 2003

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)

Ellen L. Weintraub, Chair

Bradley A. Smith, Vice Chairman

David M. Mason, Commissioner

Danny L. McDonald,

 Commissioner

Scott E. Thomas, Commissioner

Michael E. Toner, Commissioner

James A. Pehrkon, Staff Director

Lawrence H. Norton, General

 Counsel

Published by the Information

 Division

Greg J. Scott, Assistant Staff

 Director

Amy Kort, Editor

http://www.fec.gov

Interim Final Rules on the

Millionaires’ Amendment

On December, 19, 2002, the

Commission approved interim final

rules to implement provisions of the

Bipartisan Campaign Reform Act of

2002 (BCRA). The new rules

implement the so-called “Millionaires’ Amendment,” which increases

individual contribution limits and

coordinated party expenditure limits

for certain candidates running

against self-financed opponents.

The rules address:

• Monetary thresholds that trigger

the increased individual contribution and coordinated party expenditure limits;

• Computation formulas used to

determine the application of the

increased limits;

• The specific amounts of the

increases in individual contribution

limits;

• New reporting and notification

requirements; and

• Repayment restrictions for personal loans from the candidate.

Threshold Amounts

The provisions of the Millionaires’ Amendment increase the

individual contribution and coordinated party expenditure limits for

House and Senate candidates whose

opponents’ personal spending

exceeds their own by more than

certain threshold amounts. The

difference between the candidates’

expenditures of personal funds can

be reduced by a disparity in other

campaign fundraising. The threshold

amounts for House and Senate

candidates differ. For House candidates the threshold amount is

$350,000; for Senate candidates it is

two times the sum of $150,000 plus

an amount equal to the voting age

population of the state in question

multiplied by $0.04.1

Opposition Personal Funds

Amount

As noted above, opposition

personal spending that exceeds the

threshold amounts does not by itself

trigger increased contribution limits.

The regulations also take into

account expenditures from the

personal funds of the candidate

seeking increased limits under the

Millionaires’ Amendment as well as

fundraising by the campaigns.

Campaigns must use the appropriate “opposition personal funds

amount” formula to determine

whether an opposing candidate has

spent sufficient personal funds in

comparison to the amounts raised by

the campaigns to trigger increased

contribution and coordinated party

expenditure limits. The opposition

personal funds formula takes half

the difference between the gross

receipts of the candidate and the

gross receipts of the opponent and

subtracts that from the amount by

which the opponent is outspending

the candidate using their personal

funds.2

 Hence, a candidate with a

significant fundraising advantage

over a self-financed opponent might

not receive an increased contribution limit. In this way, the new rules

avoid giving increased contribution

limits to candidates whose campaigns have a significant fundraising

advantage over their opponents.

Increased Contribution Limits

When a House candidate’s

opposition personal funds amount

exceeds the $350,000 threshold:

• The contribution limits for the

candidate triple; and

• The national and state party

committees may make coordinated

Regulations

(continued from page 1)

1 Differently formulated: $150,000 +

(.04 x (voting age population)) =

Senate threshold.

2 Depending on the date of computation, the formula is either a – b; a – b –

((c – d)/2); or a – b – ((e – f)/2), where:

• a = opponent’s personal funds

spending;

• b = candidate’s personal funds

spending;

• c = candidate’s receipts

(contributions not from candidate);

• d = opponent’s receipts (contributions

 not from opponent);

• e = candidate’s receipts

(contributions not from candidate);

• f = opponent’s receipts (contributions

 not from opponent).

The values for c and d are determined

on June 30 of the year before the

election (report due on July 15), and

the values for e and f are determined on

December 31 of the year before the

election (year-end report due on

January 31). Prior to July 16 of the

year before the election, values for c, d,

e, and f are not included in the equations, and the “opposition personal

funds amount” formula is a – b.

future cycle. For additional information on the biennial limit, see the

December 2002 Record, page 8.✦

—Elizabeth Kurland
February 2003 Federal Election Commission RECORD

3

expenditures on behalf of the

candidate that are not subject to the

usual 2 U.S.C. §441a(d) limits.

For Senate candidates, the extent

to which a candidate’s opposition

personal funds amount exceeds the

threshold determines the amount of

the increase in contribution limits.

If it exceeds:

• Twice the threshold,3

 then the

contribution limits for the candidate are tripled;

• Four times the threshold,4

 then the

contribution limits for the candidate are raised six-fold;

• Ten times the threshold,5

 then the

contribution limits for the candidate are raised six-fold, and the

national and state party committees

may make unlimited coordinated

expenditures on the candidate’s

behalf.

Avoiding Excessive Contributions

Under the Increased Limits

Campaigns that accept contributions under the increased limits must

continually monitor the opposition

personal funds amount to ensure

their continued eligibility for the

increased limits and to make sure

that they have not accepted excessive contributions. Similarly,

national and state party committees

must monitor the opposition personal funds amount for campaigns

in which they are making coordinated party expenditures in excess

of the regular coordinated party

expenditure limits (at 11 CFR

109.32(b)).

Senate candidates (and their

authorized committees) must not

accept and national and state party

committees making coordinated

party expenditures on behalf of

Senate candidates must not make

any contribution or coordinated

party expenditure that causes the

aggregate contributions accepted

and coordinated party expenditures

made under the increased limits to

be greater than 110 percent of the

opposition personal funds amount.

Similarly, House candidates (and

their authorized committees) must

not accept and national and state

party committees making coordinated party expenditures on behalf

of House candidates must not make

any contribution or coordinated

party expenditure that causes the

aggregate contributions accepted

and coordinated party expenditures

made under the increased limits to

be greater than 100 percent of the

opposition personal funds amount.

Reporting and Notification

In order to facilitate this continual monitoring of fundraising and

personal spending by candidates and

party committees, new reporting and

notification requirements have been

added to the regulations.

At the outset, candidates must

declare on their Statement of

Candidacy (FEC Form 2) the

amount by which their personal

spending on the campaign will

exceed the applicable threshold

amount. 11 CFR 101.1(a). Also, to

facilitate opposition personal funds

calculations, by July 15 of the year

before the election and January 31

of the year in which the election

takes place, each principal campaign

committee must file a report disclosing the aggregate gross receipts for

the primary and general elections,

and the candidate’s aggregate

contributions from personal funds

for the primary and general elections (FEC Form 3Z-1). 11 CFR

104.19.

Additionally, a Senate

candidate’s principal campaign

committee must notify the Secretary

of the Senate, the Commission and

each opposing candidate within 24

hours when the candidate makes an

expenditure from personal funds

that aggregates in excess of the

threshold (FEC Form 10). 11 CFR

400.21(a). A House candidate’s

principal campaign committee must

notify the Commission, each

opposing candidate and the national

party committee of each opposing

candidate within 24 hours when the

candidate makes an expenditure

from personal funds that aggregates

in excess of the threshold (FEC

Form 10). 11 CFR 400.21(b).

From that time on, the committee

must also notify all of the abovelisted entities within 24 hours

whenever the candidate makes an

additional expenditure from personal funds in excess of $10,000. 11

CFR 400.22. Both the initial and

additional notifications must be

made by faxing or e-mailing a copy

of FEC Form 10 to all of the entities

mentioned above.6

 11 CFR 400.24.

Within 24 hours after they

become eligible, candidates who

qualify for increased coordinated

party expenditure limits (or their

principal campaign committees)

must file FEC Form 11 to inform

their national and state party committees and the Commission of the

opposition personal funds amount.

National or state political party

committees that make coordinated

expenditures on behalf of a candidate whose limits have been raised

must notify the Commission and the

candidate on whose behalf the

expenditure is made within 24

hours, using Schedule F. 11 CFR

400.30(c)(2).

Senate candidates operating

under the increased limits (or their

principal campaign committees)

must file FEC Form 12 within 24

hours after the aggregate amount of

3 $300,00 + ($0.08 x VAP).

4 $600,000 + ($0.16 x VAP).

5 $1,500,000 + ($0.40 x VAP).

6 Note that, for Senate candidates, the

original Form 10 will be filed with the

Secretary of the Senate in the manner

that all forms are normally filed.

Similarly, for House candidates, the

original Form 10 will be filed electronically with the Commission.

(continued on page 4)
Federal Election Commission RECORD February 2003

4

contributions accepted and coordinated party expenditures made

under the increased limits reaches

110 percent of the opposition

personal funds amount.

House candidates operating under

the increased limits (or their principal campaign committees) must file

FEC Form 12 within 24 hours after

the aggregate amount of contributions accepted and coordinated party

expenditures made under the

increased limits reaches 100 percent

of the opposition personal funds

amount.

Repayment of Personal Loans

from Candidate

Apart from the calculations and

disclosure requirements surrounding

the increased contribution limits, the

new rules also restrict the repayment

of loans made by the candidate to

his or her committee. The new rules

apply to all candidates, without

regard to any of the Millionaires’

Amendment provisions. For

personal loans7

 from the candidate

to his or her authorized committee

that aggregate more than $250,000,

the following rules apply:

• The committee may use contributions to repay the candidate for the

entire amount of the loan or loans

only if those contributions were

made on or before the day of the

election; and

• The committee may use contributions to repay the candidate only

up to $250,000 from contributions

made after the date of the election.

11 CFR 116.11(b).

Furthermore, if the committee

uses the amount of cash-on-hand as

of the date of the election to repay

the candidate for loans in excess of

$250,000, it must do so within 20

days of the election. 11 CFR

116.11(c). During that time, the

committee must treat the portion of

candidate loans that exceed

$250,000, minus the amount of

cash-on-hand as of the day after the

election, as a contribution by the

candidate. 11 CFR 116.11(c).

Additional Information

The Commission is soliciting

comments on all aspects of the

interim final rules and may amend

these rules, as appropriate, in

response to comments received.

Written comments must be received

on or before March 28, 2003, and

may be submitted via e-mail to

millionaire@fec.gov or via fax to

202/219-3923. For complete instructions for submitting comments,

please see the full Federal Register

notice of the interim final rules.

These rules, and their Explanation

and Justification, are published in

the January 27, 2003, Federal

Register (68 FR 3970) and are

available on the FEC web site at

http://www.fec.gov/pages/bcra/

rulemakings/millionaire.htm. The

interim final rules take effect on

February 26, 2003.✦

—Gary Mullen

Regulations

(continued from page 3)

7 Personal loans include advances or

loans to the committee endorsed by the

candidate.

Brokerage Loans and Lines

of Credit, Effective Date

The Commission’s new rules

regarding brokerage loans and lines

of credit became effective December 31, 2002. This effective date

also applies to the Commission’s

revised reporting forms, FEC Form

C-1, C-P and C-P-1, and their

instructions. See Federal Register

Announcement of Effective Date

(67 FR 79844, December 31, 2002).

The new rules implement an amendment to the Federal Election Campaign Act (the Act) that excludes

from the definition of contribution

“a loan of money derived from an

advance on a candidate’s brokerage

account, credit card, home equity

line of credit, or other line of credit

available to the candidate.”

Under the new regulations,

candidates may receive and repay

advances from their brokerage

accounts, credit cards, home equity

lines of credit and other lines of

credit without such advances

constituting “contributions” and

“expenditures” under the Act. The

new regulations also address the

reporting of the receipt and repayment of such advances. The final

rules and their Explanation and

Justification were published in the

June 4, 2002, Federal Register (67

FR 38353).1 See the July 2002,

Record, page 2.✦

—Amy Kort

1

 Please note that, as part of the

rulemakings implementing the Bipartisan Campaign Reform Act of 2002, the

Commission reorganized 11 CFR 100.7

and 100.8. The new brokerage loans

and lines of credit rules were incorporated into the reorganized sections.

Notice of Proposed

Rulemaking on Leadership

PACs

On December 26, 2002, the

Commission published in the

Federal Register a Notice of

Proposed Rulemaking (NPRM)

seeking comments on proposed

rules to address when and under

what circumstances so-called

“leadership PACs” are affiliated

with the authorized committees of

federal candidates or officeholders

and the ramifications of any such

affiliation (67 FR 78753). The

proposed rules were available for

public comment until January 31,

2003. If there are sufficient requests

to testify, the Commission may hold

a public hearing on February 26.

Background

Generally speaking, leadership

PACs are formed by federal officeholders and/or federal candidates.

The committee raises funds in order

to:
February 2003 Federal Election Commission RECORD

5

1 See the “Explanation and Justification

for Final Rules on Prohibited and

Excessive Contributions: Non-Federal

Funds or Soft Money” (67 FR 49063,

July 29, 2002), page 49107.

• Make contributions to other federal

candidates to gain support when

the officeholder seeks a leadership

position in Congress;

• Subsidize the officeholder’s travel

when he or she campaigns for

other federal candidates; and

• Make contributions to party

committees, including state party

committees in key states, or

donations to candidates for state or

local office.

The Federal Election Campaign

Act does not specifically address or

define “leadership PACs.” The

Commission first addressed leadership PACs in a 1978 advisory

opinion where it concluded that a

political action committee formed in

part by a Congressman was not

considered an authorized committee

of that Congressman as long as he

did not authorize the committee in

writing. AO 1978-12. As a result,

contributors to the leadership PAC

were not considered to make

contributions to the Congressman’s

campaign. In the advisory opinion,

the Commission further noted that—

assuming that the committee was

not affiliated with the

Congressman’s principal campaign

committee—persons could contribute up to $5,000 per year to the

leadership PAC, which is the

contribution limit for a PAC. The

Commission has continued to hold

the policy that committees formed

or used by a candidate or officeholder to further his or her campaign

are affiliated; those formed or used

for other purposes are not.

The Bipartisan Campaign Reform

Act of 2002 (BCRA) places new

limits on the amounts and types of

funds that may be solicited, received, directed, transferred or spent

by federal candidates and officeholders, their agents and entities

directly or indirectly established,

financed, maintained or controlled

by, or acting on behalf of, the

candidate or officeholder. These

limits apply to both federal and

nonfederal elections. 2 U.S.C.

§441i(e)(1) and 11 CFR 300.60 and

300.61. In the new “soft money”

rules, the Commission acknowledged that the BCRA’s limitations

apply to leadership PACs.1

 The

Commission now seeks comments

about whether its current approach

to leadership PACs, including the

limitations imposed by the BCRA

already implemented in the

Commission’s other regulations,

adequately addresses the real or

perceived potential for abuse

regarding leadership PACs, and

whether the BCRA requires or

permits the Commission to change

its policy toward leadership PACs.

Proposed Rules

The NPRM offers three alternative amendments to the current

affiliation rules at 11 CFR 105(g) to

address the affiliation of candidate’s

committees and leadership PACs.

The first two options focus on the

relationship between the committees

involved and the candidate or

officeholder with whom the committee is closely associated. If the

factors establishing a certain close

association are present, then a

candidate’s authorized committee

and unauthorized committees will

be considered affiliated committees.

The Commission additionally asks

whether the factors listed in these

two alternatives should establish a

rebuttable presumption of affiliation, rather than per se affiliation. If

so, what factors could be used to

rebut the presumption?

The third alternative, in contrast,

focuses on the actions of the committees involved. Under this scenario, if the activities of an

unauthorized committee mirror or

supplement the activities of an

authorized committee, then the

committees would be affiliated.

Thus, if for example a leadership

PAC took on certain activities to

assist in the election efforts of the

candidate with whom it is associated, the committees would be

deemed affiliated. This alternative

would largely continue the

Commission’s current treatment of

leadership PACs.

In addition to offering these

three alternatives, the NPRM seeks

comments on such issues as:

• Other criteria, if any, that should

be used in determining affiliation

between leadership PACs and

authorized committees;

• Whether affiliated authorized

committees and leadership PACs

should share contribution limits

and, if so, whether they should

share the limits for the authorized

committees or those for PACs;

• What the ramifications would be

for a finding of affiliation in

terms of restrictions on raising

and spending nonfederal funds;

and

• Whether the issue of leadership

PACs should be addressed in a

separate section of the regulations.

 The full text of the NPRM is

available:

• On the FEC web site at http://

www.fec.gov/pages/bcra/

rulemakings/

leadership_pacs.htm; and

• From the FEC Faxline, 202/501-

3413.✦

—Amy Kort

(continued on page 6)
Federal Election Commission RECORD February 2003

6

Contribution Limitations

and Prohibitions; Delay of

Effective Date and

Correction

On December 27, 2002, the

Commission published in the

Federal Register a correction to the

final rules governing contribution

limits and prohibitions1

 (67 FR

78959), which is available on the

FEC web site at http://www.fec.gov/

pages/bcra/rulemakings/

rulemakings_bcra.htm.

The correction makes two

changes to the final rules. First, it

delays until January 13, 2003,2

 the

effective date for revised 11 CFR

110.9, which addresses violations of

the contribution and expenditure

limitations. The new effective date

of this regulation coincides with the

effective date for the final rules on

Disclaimers, Fraudulent Solicitation,

Civil Penalties and Personal Use of

Campaign Funds (67 FR 76962,

December 13, 2002). The effective

date for other provisions of the

contribution limits and prohibitions

rulemaking remains January 1.

Second, the correction revises

portions of the final rules that

address the procedure governing the

reattribution of excessive contributions. The final rules at 11 CFR

110.1(k)(3)(ii)(A)(1) and

(k)(3)(ii)(B)(2), which describe

1 The final rules were published in the

November 19, 2002, Federal Register

(67 FR 69928), and are summarized in

the December 2002 Record, page 8. All

rulemakings related to the Bipartisan

Campaign Reform Act of 2002 (BCRA)

are available on the FEC web site at

http://www.fec.gov/pages/bcra/

rulemakings/rulemakings_bcra.htm.

2 The Commission published a correction to this document to change the

effective date from January 13, 2002, to

January 13, 2003 (68 FR 1793,

January 14, 2003).

steps a recipient political committee

must take when reattributing

excessive contributions from one

contributor to another, inadvertently

included the word “authorized”

before the phrase “political committee.” The reattribution procedure is

available to all political committees,

not just authorized committees.✦

—Amy Kort

Regulations

(continued from page 5)

BCRA Technical

Amendments

On December 26, 2002, the

Commission published in the

Federal Register technical amendments to title 11 of the Code of

Federal Regulations (67 FR 78679).

As part of the Bipartisan Campaign

Reform Act of 2002 (BCRA) the

Commission has published a series

of rulemakings, including a

rulemaking that reorganized the

definitions of “contribution” and

“expenditure” formerly located at 11

CFR 100.7 and 100.8. The technical

amendments correct cites in title 11

that make cross references to these

former sections and to other references that have changed under the

new BCRA regulations. The technical amendments also correct typographical errors in the various rules.

The technical amendments,

which took effect on December 26,

are available on the FEC web site at

http://www.fec.gov/pages/bcra/

rulemakings/

rulemakings_bcra.htm.

1

✦

—Amy Kort

1

These amendments changed regulations that were promulgated but had

not become effective as of December

26, 2002. On January 22, 2003, the

Commission re-promulgated the

technical amendments that did not take

effect with the original BCRA technical

amendments (68 FR 2871).

Federal Register

Federal Register notices are

available from the FEC’s Public

Records Office, on the FEC web

site at http://www.fec.gov/

register.htm and from the FEC

faxline, 202/501-3413.

Notice 2002-8

Brokerage Loans and Lines of

Credit Correction (68 FR 611,

January 6, 2003)

Notice 2002-26

Final Rules on BCRA Reporting

(68 FR 404, January 3, 2003)

Notice 2002-27

Final Rules on Coordinated and

Independent Expenditures (68 FR

421, January 3, 2003)

Notice 2002-28

Notice of Proposed Rulemaking

on Leadership PACs (67 FR

78753, December 26, 2002).

Notice 2002-29

BCRA Technical Amendments

(67 FR 78679, December 26,

2002)

Notice 2002-30

Contribution Limitations and

Prohibitions: Delay of Effective

Date and Correction (67 FR

78959, December 27, 2002)

Notice 2002-31

Brokerage Loans and Lines of

Credit: Announcement of

Effective Date (67 FR 79844,

December 31, 2002)

Notice 2003-1

Contribution Limitations and

Prohibitions: Correction (68 FR

1793, January 14, 2003)

Notice 2003-2

BCRA Technical Corrections (68

FR 2871, January 22, 2003)
February 2003 Federal Election Commission RECORD

7

Compliance

(continued from page 1)

cate with its executive personnel on

any subject, Amboy, which does not

have a corporate PAC, may not use

its resources or facilities to engage

in fundraising activities—including

the collecting and forwarding of

contributions. 2 U.S.C.

§441b(b)(2)(A) and 11 CFR

114.2(f) and 114.3(a)(1); see also

AO 1987-29.

In the early 1990s, Amboy’s

Board of Directors approved an

expense account program whereby

senior officers made political

contributions from these accounts.

Peggy Ann Dembowski, a Vice

President at Amboy, performed

activities during regular business

hours in connection with opening

the expense accounts, ordering

checks for drawing on these accounts, drafting, signing and transmitting contribution checks and

updating spreadsheets to track

contributions made from each

account. When political solicitations

were received by Amboy or by

individual officers, they were

generally forwarded to Ms.

Dembowski. Mr. Scharpf and Ms.

Dembowski coordinated the political contributions and attendance at

fundraising events in an informal

manner. Political contributions were

coordinated to avoid duplicating

contributions and to make the

greatest business impact for Amboy.

Attendance at events was also

coordinated to ensure Amboy was

represented through its senior

officers.

Eleven senior officers used their

expense accounts between February

1996 and January 2002 to make at

least 149 contributions totaling

$55,322. The contributions were

primarily made to nonfederal

candidates and party organizations,

but also included eleven contributions to federal candidates and party

committees, totaling $8,000. The

majority of contributions were made

by Mr. Scharpf and Ms.

Dembowski. By using its staff and

other resources to set up and administer the expense account program,

including collecting and forwarding

contributions paid from these

accounts, Amboy facilitated the

making of these contributions. In

addition, Mr. Scharpf directed his

executive assistant to collect and

forward during work hours contributions to JebPAC that were made

from staff members’ personal bank

accounts. Again, by using staff and

resources to collect and forward

JebPAC contributions, Amboy

facilitated the making of those

contributions.

Right to Refuse to Contribute

The Act requires that a solicitation for a contribution to a trade

association’s PAC include a notice

informing the solicitee of the

political purpose of the fund and of

his or her right to refuse to contribute without reprisal. The solicitation

may suggest a guideline for contributions, but it must also state that

the solicitee is free to contribute

more or less than that amount and

that he or she will not be favored or

disadvantaged because of either the

amount contributed or his or her

decision not to contribute. 11 CFR

114.5(a)(2)-(5). See also AOs 1998-

19 and 1985-12.

JebPAC is the separate segregated fund of the New Jersey

Bankers Association. As a member

of this trade association, Amboy has

authorized JebPAC annually to

solicit its executive and administrative personnel. JebPAC sent copies

of contribution materials to Amboy,

which were then forwarded to

Amboy’s officers and branch

managers, along with a solicitation

memorandum signed by Mr.

Scharpf. JebPAC’s contribution

forms, which have remained the

same since 1996, included suggested contribution amounts corresponding with various “Membership

Categories.” The contribution forms

did not inform the individual that he

or she could contribute less than the

suggested amount, nor that JebPAC

would not favor or disadvantage

anyone based on his or her decision

not to contribute.

In his memorandum accompanying these contribution forms, Mr.

Scharpf also listed a minimum

contribution amount that “would be

appreciated.” The memorandum did

not inform the individual that he or

she could contribute more or less

than the suggested amount—which

was usually either $25 or $50—or

that Amboy would not favor or

disadvantage anyone based on his or

her decision not to contribute.

Conciliation Agreements

In their conciliation agreement,

Amboy and Mr. Scharpf contended

that, while they were aware of the

prohibition on political contributions by national banks at the time

of the activity in question, they did

not understand that the expense

account program or the collecting

and forwarding of individual officer

contributions constituted a violation

of the Act. However, Amboy

admitted to facilitating the making

of contributions and to failing to

include required notices on its

solicitations to JebPAC. 2 U.S.C.

§§441b(a) and 441b(b)(3) and 11

CFR 114.5(a). Amboy agreed to

cease and desist from violating these

provisions and to pay a $60,000

civil penalty. George Scharpf

admitted to consenting to the

facilitation of these contributions,

and agreed to pay a $24,000 fine

and to cease and desist from further

violations of 2 U.S.C. §441b(a).

In its conciliation agreement,

JebPAC admitted to failing to

include the required statements in its

solicitations and agreed to pay a

$2,000 civil penalty. JebPAC will

cease and desist from further

violations of 2 U.S.C.

§441b(b)(3).✦

—Amy Kort
Federal Election Commission RECORD February 2003

8

Court Cases

FEC v. Freedom’s Heritage

Forum, et al.

On December 5, 2002, the U.S.

District Court for the District of

Kentucky at Louisville denied the

defendants’ requests to alter, amend

or vacate the court’s March 28,

2002, order in this case and to file

counter claims. The court found that

the March ruling was sound, and

that there was no reason to reduce

the fine of $1,000 per violation

assessed against Freedom’s Heritage

Forum for violations of the disclaimer rules at 2 U.S.C. §441d(a).

See the August 2002, Record, page

2.

U.S. District Court for the

District of Kentucky at Louisville,

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

—Amy Kort

Lenora B Fulani v. FEC

On January 3, 2002, the U.S.

District Court for the District of

Columbia granted the Commission’s

motion to dismiss this case, finding

that Dr. Fulani lacked standing to

bring the lawsuit.

Background

Dr. Fulani was a Presidential

candidate in the 1988 and 1992

elections. In the summer of 1995,

she planned to campaign against

President Clinton in the 1996

Democratic primaries. However, in

August of that year the Commission

issued a repayment determination

for approximately $612,000 against

her 1992 Presidential campaign. Dr.

Fulani alleged that as a result she

lacked the financial resources to run

in the 1996 elections. Dr. Fulani

then filed a complaint with the

Commission alleging, among other

things, that President Clinton

violated laws relating to primary

spending limits. The Commission

did not find reason to believe that

the violations had occurred and

closed the matter, MUR 4713, in

March 2000.

Court Case

In her court complaint, Dr. Fulani

alleged that the Commission’s

dismissal of MUR 4713 was

arbitrary, capricious, an abuse of

discretion and contrary to law. She

argued that, based on the information developed by the Commission’s

General Counsel’s office, there was

both reason to believe and probable

cause to believe that President

Clinton, his primary campaign

committee and the Democratic

National Committee violated the

Presidential Primary Payment

Account Act. She asked the court to

compel the Commission to act on

the complaint.

Standing. In order to have

standing to bring such a lawsuit, a

plaintiff must demonstrate:

1. An injury in fact;

2. A causal connection between the

injury and challenged conduct;

and

3. A likelihood that the injury will

be redressed by a favorable

decision of the court.

The plaintiff’s injury must be

“concrete and particularized,” as

well as “actual” or “imminent.”

Lujan v. Defenders of Wildlife, 504

U.S. 555, 560 (1992).

Decision. The court found that

while Dr. Fulani did suffer a concrete injury when she was stopped

from running for office, the

Commission’s failure to pursue her

administrative complaint did not

cause this injury. Dr. Fulani argued

that the Commission’s repayment

determination caused her injury, but

that determination was not before

the court in this case. Moreover, the

Commission’s alleged failure to act

on Dr. Fulani’s administrative

complaint occurred well after her

failure to run for the Presidency in

1996. Finally, the court found that

Dr. Fulani could not demonstrate

how her alleged injury could be

redressed by the court. The court

granted the Commission’s motion to

dismiss the case.

U.S. District Court for the

District of Columbia, 00-1018

(WBB).✦

—Amy Kort

Advisory

Opinions

AO 2002-12

Disaffiliation of

Corporations and their PACs

Due to significant restructuring

on the part of their connected

organizations, American Medical

Security, Inc., PAC (AMSPAC) and

Blue Cross and Blue Shield United

of Wisconsin PAC (BCBSPAC) are

disaffiliated for the purposes of the

Federal Election Campaign Act (the

Act).

Background

Originally, Blue Cross Blue

Shield of Wisconsin (BCBS) was

the sole owner of United Wisconsin

Service (UWS). BCBS is the

connected organization of

BCBSPAC.

In 1996, UWS became the parent

company of American Medical

Security, Inc. (AMS). BCBS owned

38 percent of AMS through its sole

ownership of UWS. AMS is

AMSPAC’s connected organization.

In the midst of this corporate

restructuring, both BCBSPAC and

AMSPAC filed amended Statements

of Organization, where each listed

the other’s connected organization

as its own.

In 1998, UWS changed its name

to American Medical Security

Group (AMSG). AMSG owned 100

percent of AMS.

In 2001, BCBS became a forprofit company and, as a result of

this restructuring, was a whollyowned subsidiary of the Cobalt

Corporation. As of January, 2002,
February 2003 Federal Election Commission RECORD

9

Cobalt owned 45 percent of AMSG

through BCBS. AMSG, in turn,

owns 100 percent of AMS. By

October of 2002, Cobalt’s share had

reduced to 12.3 percent.

Affiliation

Under the Act and Commission

regulations, committees established

by the same corporation, person or

group—including any parent,

subsidiary, branch, division, department or local unit of a given entity—are affiliated. 2 U.S.C.

§441a(a)(5) and 11 CFR 100.5(g)(2)

and 110.3(a)(1). Affiliated committees are considered to be a single

committee and share contribution

limits. Therefore, contributions

made to or by affiliated committees

are considered to have been made to

or by a single committee. 2 U.S.C.

§441a(a)(5) and 11 CFR

100.5(g)(2), 110.3(a)(1) and

110.3(a)(1)(ii).

In cases where the relationship of

one company to another—and, by

extension, one company’s PAC to

another’s—does not constitute per

se affiliation under the regulations,

Commission regulations provide a

list of factors that the Commission

considers when, on a case-by-case

basis, it examines the relationship to

determine whether or not the

companies are affiliated. 11 CFR

100.5(g)(4)(i) and (ii)(A)-(J) and

110.3(a)(3)(i) and (ii)(A)-(J). This

list is not exhaustive, and other

factors may be considered. The

relevant factors to consider with

respect to corporations that are not

membership organizations include

whether:

• An entity has controlling stock or

securities in the sponsoring

organization of another committee;

• A committee, through formal rules

or through formal or informal

practices, has the authority or

ability to direct or participate in the

governance of another sponsoring

organization or committee;

• A sponsoring organization has the

authority or ability to hire, appoint,

demote or otherwise control the

decision-making agents of another

sponsoring organization or committee;

• Committees share officers or

employees in a manner which

indicates a formal or ongoing

relationship between the organizations or committees;

• A sponsoring organization or

committee had any members,

officers or employees of another

sponsoring organization which

indicated a formal or ongoing

relationship between them;

• They share a pattern of contributions or contributors which indicates a formal or ongoing

relationship;

• A sponsoring organization or

committee provided funds or

goods, or caused or arranged for

funds or goods, in a significant

amount or ongoing basis to another

organization or committee; and

• One sponsoring organization or

committee had an active or significant role in the formation of

another.

11 CFR 110.3(a)(3)(ii)(A), (B),

(C), (E), (F), (G), (H), (I) and (J).

Analysis

Since 1996, the relationship

between Cobalt/BCBS and AMSG

has changed significantly, thereby

ending the affiliation of their PACs.

Over time, Cobalt/BCBS has sold

the majority of its stock in AMSG,

reducing its share from 45 percent to

12.3 percent. Despite partial ownership of ASMG, BCBS’s ownership

share is noncontrolling. The corporate structure requires a plurality

vote of a quorum at the annual

shareholder meeting to elect directors. Also, large supermajorities are

required to replace a director or to

amend the articles of incorporation.

There are no current overlaps of

directors, officers or employees

between Cobalt/BCBS and AMS,

except for one person whom BCBS

can appoint to AMSG’s board of

directors so long as BCBS’s stock

ownership remains over ten percent.

It appears that the largest common

shareholders do not each hold

significant percentages of each

company’s stock.

Solicitations and contributions

are made separately by each PAC

and do not indicate a common

pattern. They do not make joint

solicitations, nor do they transfer

funds between them. Largely,

communications between

BCBSPAC and AMSPAC are

restricted to their effort to ensure

that contributions by each do not

exceed their shared contribution

limits.

Finally, though BCBS could be

said to have had a role in the

formation of AMS, the substantial

corporate restructuring since that

point has made that factor insignificant.

Given the separation of the two

connected organizations in terms of

ownership, control and personnel,

and given the separation of the

PACs in terms of their financial

independence, different staffs and

different contribution patterns,

AMSPAC and BCBSPAC are no

longer affiliated for the purposes of

the Act.

Date Issued: December 10, 2002;

Length: 8 pages.✦

—Phillip Deen

Advisory Opinion Request

AOR 2002-15

Affiliation of trade associations

and joint administration of trade

association PAC (American Association of Clinical Urologists and

the American Urological Association, December 23, 2002)✦
Federal Election Commission RECORD February 2003

10

Audits

Commission Makes Final

Determination on Audits of

Presidential Candidates for

2000

The Commission recently made

final determinations of the amount

of money that the Buchanan, Bush,

Gore, Keyes and Nader Presidential

campaign committees must repay to

the U.S. Treasury (the Treasury) for

public funds they used during the

2000 elections. The Commission

made its determination after conducting audits of the committees, as

required under the Presidential

Election Campaign Fund Act and

the Presidential Primary Matching

Payment Account Act. 26 U.S.C.

§§9007(a), 9008(g) and 9038(a).

Buchanan Committees

Patrick Buchanan’s primary

committee, Buchanan Reform, Inc.,

(BRI) did not receive primary

matching funds in excess of its

entitlement and did not need to

make any repayments to the U.S.

Treasury (the Treasury). The

Commission determined, however,

that $151,277 in expenditures were

for general election expenses and

that this amount is due from Mr.

Buchanan’s general campaign

committee.

Additionally, the Commission

found that in 356 instances BRI had

failed to timely refund excessive

contributions, and in 4,820 instances

BRI failed to itemize contributions

from individuals. 2 U.S.C.

§§441a(a)(1)(A) and 434(b)(3)(A);

11 CFR 110.1, 110.1(b), 110.1(k)

and 103.3(a). The audit concluded

that BRI’s difficulties in aggregating

contributions contributed to both its

failure to itemize some contributions

once they exceeded $200 and its

failure to refund contributions that

exceeded $1,000 from an individual.

Finally, the audit found that BRI

misstated some financial activity,

primarily by failing to report

receipts and disbursements from its

Convention 2000 account. BRI filed

amended reports to correct these

misstatements and to itemize

contributions that exceeded $200.

Mr. Buchanan’s general election

campaign, Buchanan Foster, Inc.,

(BFI), must repay $58,033 to the

Treasury. This amount represents

$33,479 in surplus funds and

$24,554 that the committee received

in interest on invested public funds.

The audit also found that BFI

purchased a mailing list from the

primary committee, BRI, at a cost

that was $147,496 in excess of the

fair market value of the list. In

determining BFI’s assets, the Audit

staff listed this overpayment as an

amount receivable due from BRI to

BFI.

The audit also found that BFI

failed to itemize 76 contributions

from individuals, totaling $34,230.

BFI amended its reports to itemize

these contributions.

Bush Committees

Bush-Cheney 2000, Inc.,

(BC2000), President Bush’s general

election committee, must repay

$224,518 to the Treasury. A portion

of this repayment, $95,509, represents contributions the committee

received when it paid the first-class

fare for air travel on licensed

commercial charter carriers, rather

than the charter rate.1

 The remaining

repayment represents the amount

that BC2000 exceeded the

$67,560,000 expenditure limitation

for publicly-funded Presidential

candidates in the 2000 general

election.

BC2000 has already repaid

$255,003 to the Treasury, representing income that the committee

received from interest earned on

invested public funds and from

selling the use of film footage

related its media ads. An additional

$7,701, representing stale-dated

checks, was repaid by BC2000, and

the Bush-Cheney Compliance

Committee, Inc., has also made a

$33,415 repayment representing

stale-dated checks.

President Bush’s primary election

committee did not accept public

funds and, thus, was not required to

be audited.

Gore Committees

Gore 2000, Inc., former Vice

President Al Gore’s primary committee, must repay $118,485 to the

Treasury. Most of this amount,

1 Commission regulations provide that

the campaign may pay the first-class

rate if the airplane is owned or leased

by a corporation, other than a corporation licensed to offer commercial travel

services, and the travel is between cities

served by regularly-scheduled commercial service. 11 CFR 114.9(e)(1). If the

corporation is licensed to offer commercial air travel services and the

campaign pays the first-class rate,

rather than the charter rate, then the

difference between the first-class and

charter rates represents a contribution

to the campaign. If the Commission

determines that a major party Presidential candidate who has accepted public

funding also accepts contributions to

defray qualified campaign expenses

(other than contributions to make up

deficiencies in payments from the

Presidential Election Campaign Fund),

then the candidate must repay that

amount to the Treasury. 11 CFR

9007.2(b)(5).

Updated FECA

Available

The new edition of the Federal

Election Campaign Act (FECA)

is now available. Current as of

November 2002, this edition

incorporates amendments made

by the Bipartisan Campaign

Reform Act of 2002 (BCRA).

The Commission has mailed

copies of the new edition of the

FECA to registered political

committees. Free copies are also

available to the public. Simply

call 800/424-9530 (press 1, then

3) or 202/694-1100.
February 2003 Federal Election Commission RECORD

11

$116,000, represents primary

matching funds that Gore 2000, Inc.,

received in excess of its entitlement.

This repayment is in addition to a

$54,591 repayment the committee

has already made representing

surplus funds. The remaining $2,485

represents stale-dated checks.

Mr. Gore’s general election

committee, Gore/Lieberman, Inc.,

(Gore/Lieberman), and the Gore/

Lieberman General Election Legal

and Accounting Compliance Fund

must repay $3,262 to the Treasury,

representing stale-dated checks.

Gore/Lieberman has already repaid

$11,625 representing interest earned

on invested public funds.

The audit also found that Gore/

Lieberman failed to properly

disclose payments totaling $599,410

that the committee received as a

result of payments made to a charter

program it had hired to arrange air

travel for Senator Joseph

Lieberman, campaign staff, members of the press and others. In

response to the audit finding, Gore/

Lieberman filed reports disclosing

this activity.

Keyes Committee

Keyes 2000, Inc., (Keyes 2000)

Ambassador Alan Keyes’s primary

committee, did not receive public

funds in excess of its entitlement,

but must repay $104,448 to the

Treasury representing nonqualified

campaign expenses and costs

associated with continuing to

campaign. The largest portion of

this repayment, $74,439, represents

nonqualified campaign expenses. In

most cases, Keyes 2000 lacked

adequate documentation to show the

purpose of these expenses. Keyes

2000 must also repay $30,009,

representing public funds it spent

continuing to campaign after the

candidate’s date of ineligibility. In

addition, Keyes 2000 must pay the

Treasury $8,003, representing staledated checks. See 11 CFR

9034.3(a)(3)(ii) and 9034.4(b)(3).

The audit additionally found that

Keyes 2000 made cash disbursements in excess of the $100 limit for

petty cash disbursements, which

totaled $107,863 in the aggregate.

11 CFR 102.10 and 102.11. Moreover, Keyes 2000 accepted cash

contributions in excess of the $50

limit for such contributions. In the

aggregate, these excessive cash

contributions totaled $15,013, which

the committee must disgorge to the

Treasury.

Keyes 2000 must also disgorge to

the Treasury $95,286 representing

excessive contributions. The audit

found that while Keyes 2000

disclosed excessive contributions in

its FEC reports as early as 1997, it

only began to address these contributions in April 2000. Commission

regulations allow a 60-day window

for remedying excessive contributions, at the end of which time the

excessive contribution must be

refunded. 11 CFR 110.1(k)(3)(i) and

110.1(k)(3)(ii)(A) and (B). The

Audit staff initially projected an

amount of $168,200 for unresolved

excessive contributions. However,

the Commission has recently

adopted regulations allowing

committees greater latitude to

reattribute contributions to joint

account holders, and has applied

these new provisions to current

matters. See the December 2002

Record, page 8. Accordingly, the

Audit staff reduced its projection to

$95,286.

Nader Committee

Ralph Nader’s primary committee, Nader 2000 Primary Committee, Inc., (NPC) did not receive

public funds in excess of its entitlement, but must repay to the Treasury $11,398, representing

stale-dated checks. The audit also

found that NPC erroneously received 1,550 contributions that were

instead intended for the general

election campaign. Thus, the audit

did not include the resulting $96,744

in contributions when calculating

the amount of matching funds NPC

was entitled to receive after Mr.

Nader’s date of ineligibility. Additionally, the audit found that NPC

materially misstated receipts and

disbursements, resulting in a

$337,424 overstatement of its cashon-hand. In response to the audit,

NPC amended its reports to correct

misstatements of receipts, disbursements and cash-on-hand.✦

—Amy Kort

Alternative

Dispute

Resolution

ADR Program Update

The Commission recently

resolved three additional cases

under the Alternative Dispute

Resolution (ADR) program. The

respondents, the alleged violations

of the Federal Election Campaign

Act (the Act) and the penalties

assessed are listed below.

1. The Commission reached

agreement with the Ensign For

Senate committee, its treasurer,

Linzel L. McBride, and Internet

Auto Rental & Sales concerning

corporate contributions. Ensign for

Senate and its treasurer agreed to

designate a staff member as the FEC

compliance officer and to have this

individual attend an FEC-sponsored

seminar for candidate committees

this year. Internet Auto Rental &

Sales agreed to distribute a memorandum to management personnel

reiterating the prohibitions on

corporate contributions to federal

candidates and to gain an understanding of the prohibitions and

requirements of the Act before

interacting with federal candidates.

The Commission decided to dismiss

matters arising from the same

complaint that involved the SevenUp Bottling Co. of Reno and

Custom Concrete Cutting, Inc., and

directed the ADR Office to close the

file. (ADR 046 MUR 5131).

(continued on page 12)
Federal Election Commission RECORD February 2003

12

Congressional Campaign

Financial Activity Declines

from 2000 Levels

General election candidates for

the U.S. House and Senate spent a

total of $772.3 million between

January 1, 2001, and November 25,

0

50

100

150

200

92 94 96 98 00 02 100

150

200

250

0

50

100

150

200

92 94 96 98 00 02 100

150

200

250

Median Spending by Challengers in House Races—1992-2002

Democrats Republicans

Disbursements

Number of Candidates

Thousands of Dollars Candidates Thousands of Dollars Candidates

2. The Commission dismissed the

matter concerning A.J. Fusco, Jr.,

Esq., A.J. Fusco & Associates,

Friends of Senator D’Amato and its

treasurer Linda Schwantner, after

concluding that alleged violations of

the Act’s prohibitions on the

corporate facilitation of contributions were unsubstantiated. (ADR

076 MUR 5245).

3. The Commission reached

agreement with Meeks for Congress

2000 and its treasurer, Joan E.

Flowers, concerning the

committee’s failure to provide

contributor information in its

disclosure reports. In addition to

paying a $3,500 civil penalty and

amending previously-filed reports,

Meeks for Congress 2000 will take

the following steps to ensure

compliance with the reporting

requirements of the Act:

• Use a computer program to note

and record the name, address,

occupation and employer of each

contributor;

• Advise contributors when this

information is missing;

• Train new committee staff in the

Act’s reporting requirements;

• Enroll new staff in an FECsponsored seminar for campaign

committees during the next 15

months; and

• Designate a committee staff

member as the individual responsible for FEC compliance.

(ADR 070-AR 02-02).✦

—Amy Kort

Alternative Dispute

Resolution

(continued from page 11)

Statistics

2002, representing a decline of 10

percent from the record amounts

spent in a comparable period during

the 2000 election cycle. Fundraising

by these candidates totaled $821.8

million through late November, also

10 percent lower than in the previous cycle.

The decline in financial activity

was limited to Senate campaigns,

where receipts totaled $282.3

million and disbursements were

$272.6 million. These figures

represent declines of 23 percent in

receipts and 25 percent in disbursements when compared with the 2000

campaign. Senate races are inherently difficult to compare, however,

because the states holding elections

vary from year to year, and because

individual races or candidates can

have a significant impact on the

overall totals. For example, the open

seat campaigns in New York and

New Jersey in 2000 generated large

spending totals that were not

matched in the most expensive 2002

races.
February 2003 Federal Election Commission RECORD

13

Committees Fined for

Nonfiled and Late Reports

The Commission recently

publicized its final action on 19 new

Administrative Fine cases, bringing

the total number of cases released to

the public to 483.

Civil money penalties for late

reports are determined by the

number of days the report was late,

the amount of financial activity

involved and any prior penalties for

violations under the administrative

fines regulations. Penalties for late

Administrative

Fines

Committees Fined and Penalties Assessed

1 This civil money penalty has not been collected.

2 A partial payment has been made.

1. American Academy of Ophthalmology Inc.

Political Committee (OPHTHPAC) $1,950

 2. Baker & Hostetler PAC $1,500

 3. Campbell for Senate $6,500

4. D.C. Republican Committee Federal

Campaign Committee $3,975

 5. Dreier for Congress Committee $650

 6. Florida Sugar Cane League PAC $4,5001

 7. Hudson Valley PAC December Monthly 2001 $900

 8. Hudson Valley PAC Year End Report 2001 $1,800

 9. Hudson Valley PAC February Monthly 2002 $900

10. Hudson Valley PAC March Monthly 2002 $900

11. Humana Inc. PAC $900

12. Lazio 2000 Inc, $8,350

13. Local 500 Political Action Fund $900

14. National Air Traffic Controllers Association PAC

(NATCA PAC) $3,500

15. Natural Law Party of the United States of America $7,5002

16. Operating Engineers Local 12 Voluntary

Legislative Fund $275

17. Uniformed Firefighters Association PAC

(FIRE PAC) $2,100

18. Voters for Choice/Friends of Family Planning $2,700

19. Wareing for Congress $21,200

In the 2002 election cycle, House

candidates raised $539.5 million,

nearly unchanged from 2000 totals,

and spent $499.7 million, up one

percent from the previous cycle. In

contrast, House candidates’ financial activity increased by about 30

percent between 1998 and 2000.

There were substantial declines in

median activity for House challengers of both parties, and fewer

competitive House races overall, in

spite of reapportionment and

redistricting following the 2000

census. See the graph on page 12.

Additional Information

A press release dated January 2,

2003, provides detailed information

about the financial activity of House

and Senate candidates, including

tables chronicling overall receipts

and disbursements dating back to

1990. The press release is available:

• On the FEC web site at

www.fec.gov/news.html;

• From the Public Records office

(800/424-9530, press 3) and the

Press Office (800/424-9530, press

5); and

• By fax (call the FEC Faxline at

202/501-3413 ).✦

—Amy Kort

reports—and for reports filed so late

as to be considered nonfiled—are

also determined by the financial

activity for the reporting period and

any prior violations. Election

sensitive reports, which include

reports and notices filed prior to an

election (i.e., 12 day pre-election,

October quarterly and October

monthly reports), receive higher

penalties. Penalties for 48-hour

notices that are filed late or not at all

are determined by the amount of the

contribution(s) not timely reported

and any prior violations.

The committees and the treasurers are assessed civil money penalties when the Commission makes its

final determination. Unpaid civil

money penalties are referred to the

Department of the Treasury for

collection.

The committees listed in the chart

below, along with their treasurers,

were assessed civil money penalties

under the administrative fines

regulations.

Closed Administrative Fine case

files are available through the FEC

Press Office, at 800/424-9530 (press

2), and the Public Records Office, at

800/424-9530 (press 3).✦

—Amy Kort
Federal Election Commission RECORD February 2003

14

Conference Schedule

for 2003

Conference for House and

Senate Campaigns and Political

Party Committees

March 12-13, 2003

Washington, DC

Conference for Corporations

and their PACs

April 29-30, 2003

Washington, DC

Conference for Trade

Associations, Membership

Organizations and their PACs

May 21-22, 2003

Boston, MA

Conference for Labor

Organizations and their PACs

June 17-18, 2003

Washington, DC

Regional Conference for House

and Senate Campaigns,

Political Party Committees and

Corporate/Labor/Trade PACs

September 9-10, 2003

Chicago, IL

Regional Conference for House

and Senate Campaigns,

Political Party Committees and

Corporate/Labor/Trade PACs

October 28-29, 2003

San Diego, CA

FEC Conferences in March

and April

Conference for House and Senate

Campaigns and Political Party

Committees

The Federal Election Commission will hold a conference in

Washington, DC, for House and

Senate campaigns and political party

committees. The conference will be

held March 12-13, 2003, and will

consist of a series of interactive

workshops presented by Commissioners and experienced FEC staff,

who will explain how the requirements of the federal election law

apply to House and Senate campaigns and political parties. Discussion topics will include fundraising

and reporting, and many workshops

will address provisions of the

Bipartisan Campaign Reform Act of

2002 that apply to federal candidates and officeholders, campaign

committees and political parties. In

addition, a representative from the

Internal Revenue Service will be

available to answer election-related

tax questions.

Conference for Corporations and

their PACs

The Commission will hold a

conference for corporations and

their PACs April 29-30, 2003, in

Washington, DC. Commissioners

and experienced FEC staff will

conduct workshops to explain how

the requirements of the federal

election law apply to corporations

and their PACs, including provisions governing fundraising, contributions, reporting and

communications, and some workshops will address new requirements

under the BCRA. In addition, a

representative from the Internal

Revenue Service will be available to

answer election-related tax questions.

Registration Information

The registration fee for each

conference is $385, which covers

the cost of the conference, materials

and meals. Registrations for the

March conference must be received

by February 19, and registrations for

the April conference must be

received by March 28. A ten dollar

late fee will be assessed for late

registrations.

The conferences will be held at

the Loews L’Enfant Plaza Hotel,

480 L’Enfant Plaza, SW., Washington, DC. The hotel is located near

the L’Enfant Plaza Metro and

Virginia Railway Express stations.

A room rate of $189 per night is

Outreach

available to conference attendees.

This room rate is only available for

reservations made on or before the

registration deadline for each

conference.

Complete conference registration

information is now available online.

Conference registrations will be

accepted on a first-come, firstserved basis. Attendance is limited,

and FEC conferences have sold out

in the past, so please register early.

For registration information:

• Call Sylvester Management

Corporation at 800/246-7277;

• Visit the FEC web site at

www.fec.gov/pages/

infosvc.htm#Conferences; or

• Send an e-mail to

toni@sylvestermanagement.com.✦

—Amy Kort

FEC Roundtables

The Commission will host three

roundtable sessions in February,

addressing the FEC’s new regulations governing:

• Disclaimers, use of campaign

funds and fraudulent solicitations;

Public Appearances

February 4, 2003

George Washington University

Washington, DC

James Kahl

February 5, 2003

American University

Washington, DC

Vice-Chairman Smith

February 11, 2003

United States Naval Academy

Washington, DC

Patricia Young

February 24, 2003

Presidential Classroom

Washington, DC

Commissioner Thomas
February 2003 Federal Election Commission RECORD

15

Date Subject Intended Audience

Roundtable Schedule

February 5 • Requirements for print television • Campaign committee

and radio advertisements treasurers

9:30 - 11 a.m. and solicitations • Political committees

• Permitted and prohibited uses • Attorneys and

 of campaign funds consultants to

• Salary payments to candidates above

• Prohibitions on fraudulent

misrepresentation

 • Prohibitions on contributions

 and expenditures by foreign

 nationals

Date Subject Intended Audience

February 12 • Communications coordinated • Party committee

with candidates, campaigns treasurers

9:30 - 11 a.m. or party committees • Political committees

• Definitions of “coordination” • Attorneys and

 and “independent expenditure” consultants to

• Rules for the timing of above

 independent expenditures and

 coordinated expenditures by

 political committees

Date Subject Intended Audience

February 19 • Requirements for Statements • House and Senate

of Candidacy candidates

9:30 - 11 a.m. • Modified contribution limits • Treasurers for above

for opponents of candidates • Attorneys and

spending large amounts of consultants to

personal funds above

• Reporting and recordkeeping

requirements for candidates

expending personal funds and

for their opponents

New Rules on Disclaimers, Use of Campaign Funds and Fraudulent

Solicitations

New Rules on Coordinated and Independent Expenditures

New Rules on the “Millionaires Amendment” Index

The first number in each citation

refers to the “number” (month) of

the 2003 Record issue in which the

article appeared. The second

number, following the colon,

indicates the page number in that

issue. For example, “1:4” means

that the article is in the January

issue on page 4.

Advisory Opinions

2002-12: Disaffiliation of corporations and their PACs, 2:8

Compliance

Cases resolved under Alternative

Dispute Resolution program,,

2:11

• Coordinated and independent

expenditures; and

• The so-called “Millionaires

Amendment,” which addresses

contribution limits for candidates

whose opponents spend large

amounts of personal funds on the

campaign.

 Each roundtable is limited to 35

participants, and will be conducted

at the FEC’s headquarters in Washington, DC. The roundtables will

begin at 9:30 a.m. and last until

11:00. Please arrive no later than

9:15, in order to allow for security

screening.

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. Prepayment is required.

The registration form is available at

the FEC’s web site at http://

www.fec.gov/pages/infosvc.htm 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.✦

—Amy Kort

(continued on page 16)
FEDERAL ELECTION COMMISSION

999 E Street, NW

Washington, DC 20463

Official Business

Penalty for Private Use, $300

Presorted Standard

Postage and Fees Paid

Federal Election Commission

Permit Number G-31

Printed on recycled paper

Federal Election Commission RECORD February 2003

Committees fined under Administrative Fine program, 1:25; 2:13

MUR 5187: Corporate reimbursements of contributions; 1:22

MUR 5208: Facilitation of contributions by national bank. 2:1

Court Cases

_____ v. FEC

– Cunningham, 1:19

– Freedom’s Heritage Forum, 2:8

– Hawaii Right to Life, Inc., 1:20

FEC v. _____

– Beaumont, 1:20

– Fulani, 2:8

– Toledano, 1:20

Regulations

BCRA reporting, final rules, 1:14

BCRA technical amendments, 2:6

Biennial limit, clarification, 2:1

Index

(continued from page 15)

Brokerage loans and lines of credit,

effective date, 2:4

Contribution limits increase, 1:6

Contribution limitations and prohibitions; delay of effective date

and correction. 2:6

Coordinated and independent

expenditures, final rules, 1:10

Disclaimers, fraudulent solicitation,

civil penalties and personal use of

campaign funds, final rules, 1:8

Leadership PACs, Notice of Proposed Rulemaking, 2:4

Millionaires’ Amendment, interim

final rules, 2:2

Reports

Draft forms and e-filing formats

available for public comment, 1:2

Reports due in 2003, 1:3