July 198

All Other Committees

All other political committees must file a semiannua

report in July covering all activity from the closing dat

of the last report through June 30.

Note: If a committee filed a quarterly report in Apri

the JUly semiannual report should only cover activity

between April 1 and June 30.

dates and that filed on a monthly basis during 1980 ma

choose one of two options:

They may continue filing monthly reports durin

1981. The monthly report, due by July 20. must cove

all activity of the preceding month (June 1-30).

Alternatively, they may file on a semiannual schedule

but only if they notified the Commission of this chang

at the time they filed their last monthly report. The Jul

semiannual report, due July 31, must cover all activit

from the closing date of the last monthly report throug

June 30. 11 CFR 104.5(c).

SPECIAL ELECTION IN PENNSYLVANIA

Pennsylvania will hold a special election in its Thir

Congressional District to fill the seat formerly held b

Congressman Raymond F. lederer. The special electio

is scheduled for July 21, 1981. The principal campaig

committees of candidates running in the election must fil

the appropriate pre- and post-election reports. All othe

political committees which support candidates in th

election (and which do not report on a monthly basis) mu

also follow this reporting schedule.

Note: The seminannual report (due July 31) will be waive

for those committees which are active in the specia

election, but which file the pre-election report on time.

continued

Special Election Filers

The semiannual report may be waived for political corn

mittees (both candidate and noncandidate) active in certai

special elections held during June and July, provided the

filed the appropriate special election reports on time. Fo

more information on reports required for committees activ

in the special elections, consult the special notices prepare

by the Commission or contact the Commission at 202

523·4068 or toll- free 800/424-9530.

THE FEDERAL ELECTION

COMMISSION

· . 1325 KStreet N.W., Washington, D·.C. 20463

Volume 7. Number 7

Note: Authorized Presidential committees may not report

on a semiannual basis. 11 CF R 104.5(b)(2).

Presidential Committees

With Activity Exceeding $100,000

Authorized Presidential committees that received or

spent in excess of $100,000 during the 1980 election year

and which, therefore, reported on a monthly basis during

the election year may choose one of two options:

They may continue filing monthly reports during

1981. The monthly report, due by July 20, must cover

all activity of the preceding month (June 1-30).

Alternatively. they may report quarterly. (If they

wish to change from a monthly to a quarterly reporting schedule, the FEC's Reports Analysis Division

requests that they notify the Commission of their

intention in writinq.] The quarterly report is due by

July 15 and must cover all activity from the closing

date of the last report through June 30.

It These committees also have the option of reporting on a monthly basis. 11 CFR 104.5(b)(2).

Presidential Committees

With Activity Less Than $100,000

Presidential committees whose activity did not exceed

$100.000 during 1980 report on a quarterly basis.* In

addition, Presidential committees active in the 1972 and

1976 elections file quarterly. The second quarterly report.

due July 15, should cover all activity between April 1 and

June 30. 11 C FR 104.5(b)(2).

Noncandidate Committees

That Filed Monthly in 1980

Political committees that are not authorized by candiREPORTS DUE IN JULY

During July, all registered political committees are

required to file semiannual. quarterly or monthly reports.

depending on the type of committee they are, The following paragraphs explain the reporting schedule for the

various categories of filers.
2

The RECORD is published by the Federal Election Commission, 7325 K Street, N.W., Washington, D.C. 20463. Co

missioners are: John Warren McGarry, Chairman; Frank P. Reiche, Vice Chairman; Joan D. Aikens, Thomas E. Har

Vernon W. Thomson; Robert O. Tiernan; l(Villiam F. Hildenbrand, Secretary of the Senate, Ex Officio; Edmund 

Henshaw, Jr., Clerk of the House of Representatives, Ex Officio. For more information, call 202/523-4068 or toll-tr

800/424-9530.

ADVISORY OPINIONS: SUMMARIES

An Advisory Opinion (AO) issued by the Comm

provides guidance with regard to the specific sit

described in the AOR. Any qualified person wh

requested an AO and acts in accordance with the o

will not be subject to any sanctions under the Act. 

persons may rely on the opinion if they are involve

specific activity which is indistinguishable in all m

aspects from the activity discussed in the AO. Those 

ing guidance for their own activity, however, should c

the full text of an AO and not rely only on the sum

given here.

AO 1981·19: Combined Funds of Political

and Administrative Accounts

Invested in Money Market Fund

The Louisiana State Medical Society Political A

Committee (LAMPAC), the separate segregated fund 

Louisiana State Medical Society (the Society), may 

in a money market fund by using the combined fun

its federal political account (which contains only 

funds that were voluntarily contributed for use in f

elections) and its administrative account (Which co

the Society's treasury funds and other monies which 

not be used in connection with federal elections). 

from the political account alone are sufficient to inve

money market fund. Funds from the administrati

count, however, are not. Under the proposed plan, 

from both accounts would be joined to invest in a m

market fund, thus permitting the administrative acco

take advantage of the high interest rate offered by a m

market fund. Interest paid to each account wou

proportionate to its investment. 

The joint investment would be permissible because

the investment would not result in a prohibited cor

contribution from the administrative account to the 

cal account since the administrative account would n

conferring a financial benefit on the political accou

the contrary, any financial benefits resulting from th

investment would be conferred on the adminis

account; while the political account has sufficient fu

make the money market investment by itself, th

ministrative account could only meet the minimum 

ment requirement by adding its funds to those o

political fund.

Secondly, the joint investment would be perm

because it would not result in a commingling of po

and treasury funds, prohibited by 2 u.S.C. §441b. 

time during the investment transaction would tre

funds be transferred from the administrative account 

political account (for political or investment purp

Rather, each account would pay separately for its p

of the investment.

Date l\IB:Ie I\b. of

AOR SWject Public Pages

1981-25 Excess funds [undesig- 5/20/81 2

nated) used for travel expenses of wife accompanying Congressman to

district.

1981-26 Costs of party on behalf 5/21/81

of incumbent who is not

vet a candidate.

1981·27 Act's preemption of 5/25/81 3

notices required by city

on political advertising,

locatlv posted.

ADVISORY OPINION REQUESTS

Advisory Opinion Requests (AORs) pose questions on

the application of the Act or Commission Regulations to

specific factual situations described in the AOA. The following chart lists recent AORs with a brief description of

the subject matter, the date the requests were made public

and the number of pages of each request. The full text of

each AOR is available to the public in the Commission's

Office of Public Records.

National and state party committees may each make

coordinated expenditures of up to $16,710 on behalf of

candidates in the special election. 2 u.S.C. §441 ald],

Expenditures by county, district and local party committees are subject to the state party limit.

The FEC has sent notices on reporting requirements and

filing dates to all individuals on the ballot in the election.

All other committees supporting candidates in the Pennsvlvania special election should contact the Commission for

more information on required reports. Call 202/523-4068

or toll-free 800/424-9530.
•

•

•

The Commission expressly conditioned its approval of the

joint investment on LAMPAC's compliance with the

following investment guidelines, which would ensure that

funds of the two accounts remained strictly segregated:

1. No Preferred Treatment for Joint Investment. The

money market fund may not provide any more benefits

to the joint investment (e.g., a higher interest rate or

more favorable terms of withdrawal) than it would have

given to an investment of a similar amount made by the

political account alone. Additionally, if the political account earned a higher interest income as a result of the

joint investment, its share of the interest income would

have to be reduced to avoid an in-kind contribution

from the administrative account.

2. Reporting of Interest Paid. lAMPAC must report any

interest earned on the political account's portion of the

investment. Itemized information on the money market

fund must be disclosed when total interest on the

political account's portion of the investment income

exceeds $200 during the calendar year. 11 CFR

104.3(a)(4)(iv).

3. Withdrawal of Investment. lAMPAC may withdraw its

investment from the money market fund by usingeither

one of the following methods:

a. The money market fund may issue separate checks to

the political and administrative accounts, respectively, each check representing the principal invested by

the account and the proportionate interest earned on

the funds provided by that account; or

b. The money market fund may issue a single combined

check to lAMPAC. The check must be deposited in a

special clearing account established with a depository

(e.g., a bank) designated by LAMPAC and identified

on LAM PAC's Statement of Organization (FEC Form

1). 11 CFR 102.2 and 103.2. The principal and

earned interest payable to each fund would then be

separated and transmitted to the respective accounts.

In either case, the political fund could not make any expenditures from the investment until both the principal and

interest had been returned to a designated campaign depository. 11 CFR 103.3(a).

The Commission did not address any tax issues involving

the investment since they are not within its jurisdiction.

(Date issued: June 4, 1981; length: 8 pages)

AD 1981-20: Joint Purchase of Treasury Bill by State

and Federal Separate Segregated Funds

If the federal and state separate segregated funds (Federal

and State PACs) of Sunkist Growers, Inc. (Sunkist) jointly

invested their excess funds in a single treasury bill, the State

PAC would make a prohibited contribution to the Federal

PAC.

Under procedures proposed by Sunkist for purchasing the

treasury bill, each PAC would issue a separatecheck to the

bank. When the bill matured, the bank, as the depository

for the investment, would issue a separate check to each

PAC representing the PAC's original investment plus any

accrued interest. Under these procedures the investment

would, nevertheless, result in a prohibited contribution

from the State to the Federal PAC because the State PAC

would confer a financial benefit (I.e., a "thing of value") on

the Federal PAC. 2 U.S.C. §441b(b)(2)(A). Specifically. by

3

combining its funds with the Federal PAC's funds to mee

the treasury bill's requirement for minimum purchase pric

the State PAC would give the Federal PAC the ability to

make an investment with a higher interest rate than tha

which would have been earned on an investment using onl

funds of the Federal PAC.

A joint investment would be permissible, however, if th

State PAC:

1. Registered, filed reports and operated as a politica

committee underthe Act; and

2. Divested itself of any contributions not permissibl

under the Act (e.g., corporate contributions). 2 U.S.C

§§433 and 434; 11 CFR 104.12.

Since the joint investment proposed by Sunkist woul

result in a prohibited corporate contribution to the Federa

PAC, the Commission did not address the issue of whethe

it would result in a prohibited commingling of State an

Federal PAC funds. (Date issued: June 4.1981; Length: 

pages)

AD 1981-21: Funds Transferred from Employees'

Individual Accounts with State

Committees to Federal Committee

An executive or administrative employee of Hallmark, Inc

who participates in a voluntary payroll deduction pla

administered by HAllPAC, the separate segregated fund o

Hallmark, may authorize the payment of funds from

his/her individual account, administered by the company

state committee, to an individual account in the federa

committee, HAllPAC-Federal. Each committee (HALL

PAC·Missouri, HAlLPAC·Kansas and HAllPAC·Federal

maintains and administers the individual accounts, wit

each employee retaining control over funds that are ear

marked as contributions to candidates from his or he

account. Since HAlLPAC-Federal is a registered "politica

committee," funds paid to the employee's individua

account in HAlLPAC·Federal would constitute "contri

butions" from that employee rather than a "transfer" o

funds from the state to the federal committee. Thes

contributions would be subject to the Act's prohibition

and the following limits and reporting requirements:

1. For each employee, total contributions to HAlLPAC

Federal would be subject to the $5,000 limit on contri

butions to a multicandidate committee (11 CFR

110.l(c)). HAllPAC·Federal would report the contri

butions according to the procedures of 11 CFR Par

104.

2. Since the employee would retain control over th

contributions he or she later earmarked to specifi

candidates from his/her individual account in HALL

PAC·Federal, the earmarked contributions would

be subject to the $1,000 per candidate, per election

limit. 11 CFR 110.1(a). HAllPAC-Federal, as th

conduit for the earmarked contributions, would repor

them according to the special earmarking procedures o

11 CFR 110.6(c).

Note: The Commission specifically declined to addres

the issue of whether contributions the employee ea

marked for federal candidates from the individual ac

count with HALlPAC-Federal would also be counted

against HAllPAC·Federal's per election contributio

continued
limits because the advisory opinion request did not

provide information on that issue. (Date issued: June 4,

1981 ; Length; 4 pages)

AO 1981-22: Funds Raised to Retire Interest on

Candidate's Primary Debt

Funds collected to pay the outstanding debts of John M.

Cogswell's 1980 primary campaign constitute "contributions" to the primary campaign and are subject to the Act's

prohibitions and dollar limits for the primary. 2 U.S.C.

§441a(a)(1)(A) and 11 CFR 110.1(a)(1); 2 U.S.C.

§§441b, 441c, 441e and 441f. A special committee

authorized by John Cogswell to collect contributions to

pay the interest on the campaign debt, the Cogswell for

Citizen Committee (Citizen Committee), is therefore

a "political committee,"subject to the Act's registration

and reporting requirements. 2 U.S.C. §431(4). The Citizen

Committee and the candidate's principal campaign committee, the Cogswell for Senate Committee, are together

subject to a single contribution limit. Thus, an individual's

combined contributions to both the Citizen Committee and

the senate Committee may not exceed $1,000. (Date

issued: May 29,1981; Length: 4 pages)

ANNUAL REPORT

The Commission submitted its Annual Report 1980 to

the President and Congress on June 1, 1981. A set of

legislative recommendations contained in Chapter I of the

Report offers both substantive and technical changes aimed

at reducing the reporting burdens on political committees

While preserving the core of the federal campaign finance

law. The rest of the Report focuses on the Commission's

administration of the public funding program for the 1980

Presidential elections and its implementation of the 1979

Amendments to the Federal Election Campaign Act of

1971. Summaries of major legal issues are included as well.

Fourteen appendices provide supplemental information on

the Commission and its activities. Several appendices

contain information on the 1980 Presidential elections as,

for example, an appendix on Primary Matching Fund

Certifications and Audits.

The FEC's Annual Report 1980 is available from the

Superintendent of Documents, U.S. Government Printing

Office, Washington, D.C. 20402; telephone 202/275-2091.

The order number is 052-006-00017-1. Purchase price,

payable in advance to the Superintendent of Documents,

is $4.75.

4

"TESTING·THE-WATER" ACTIVITES

Must an individual who raises and spends funds for the 

purpose of determining the feasibility of a potential ca

dacy register and report this activity with the FEC?

No. Funds used solely to determine whether an indiv

al should become a candidate are not considered "con

butions" or "expenditures" under the Act, unless the i

vidual subsequently becomes a candidate. (See belo

Therefore, such testing-the-water" activity would 

trigger candidate status for the individual or the registra

and reporting requirements of the Act 11 CFR 100.7(b

and 100.8(b)(l). AO 1979-26.

Must records be kept of funds received or spent 

"testing-the-water" activities?

Yes. Records must be kept of the name and add

of each donor and the date and amount of funds recei

Records must also be kept of all payments made. 11 C

100.7(b)(1), 100.8(b)(1) and 101.3.

What types of payments mayan individual make to 

a potential candidacy?

Permissible "testing-the-water" payments would incl

(but are not limited to) payments for a poll, telephone c

or travel that help determine whether an individual sho

become a candidate. 11 CFR 100.7(b)(11 and 100.8(b)(

Are there payments that would not be considered "test

the-water" payments exempted under the Act?

Yes. Funds received or spent for general public poli

advertising (e.s., purchase of television or newsp

advertising) or for activities designed to amass camp

funds to be used when the individual becomes a candi

(e.s., a fundraiser or mail solicitation) are examples 

payments that would not be considered exempted "test

the-water" payments. 11 CFR 100.7(blll) and 100.S(b

Such payments are considered "contributions" and 

penditures" under the Act. Therefore, once funds accu

lated or spent for such activities exceeded $5,000, t

would be subject to the Act's registration and repor

requirements. 11 CFR 100.3

May an individual spend more than $5,000 on "testing-

water" activities and still not be required to register 

candidate?

Yes, unless the individual becomes a candidate. (See 

low.)

What happens if an individual who has been "testing-

waters" becomes a candidate?

Once an individual becomes a candidate, any fu

previously received or disbursed to test-the-waters are 

sidered contributions and expenditures, subject to 

contin
Act's limits and prohibitions. These contributions and

expenditures must be reported on the first report filed by

the candidate's principal campaign committee, regardless

of when the funds were received or spent. 11 CFR

100. 7(b)(1) and 100.8(b)(11.

Does the amount that a donor has given to an individual

for "testing-the-water" activities count against the amount

the donor may contribute when the individual becomes a

candidate?

Yes. Funds donated to the individual for "testing-thewater" activities, when added to funds contributed to his/

her election campaign (e.g., Senate primary campaign),

would be subject to a single contribution limit for that

election ($1,000 'per election on contributions from an

individual and $5,000 per ejection on contributions from

a multicandidate committee).

FEC FILES SUBPOENA ENFORCEMENT

SUITS AGAINST DRAFT COMMITTEES

Between December 1980 and January 1981, the FEC

filed four separate suits in U.S. district courts seeking

enforcement of subpoenas it had issued to three "draft

Kennedy" political committees registered with the Commission, which had been engaged in promoting the Presidential candidacy of Senator Edward Kennedy during

1979, and to the Machinist Non-Partisan Political League

(MNPL), the separate segregated fund of the International

Association of Machinists, which had supported the for- .

mation of "draft Kennedy" groups in several states during

1979. The Commission filed suit against MNPL and Citizens

for Democratic Alternatives in 1980 in the U.S. District

Court for the District of Columbia (FEC v, Citizens for

Democratic Alternatives in 1980, Civil Action No. 800-

0009 and FEC v. Machinists Non-Partisan Political League,

Civil Action No. 79-02911, against Wisconsin Democrats for

Change in 1980 in the U.S. District Court for the Western

District of Wisconsin (FEC v. Wisconsin Democrats for

Change in 1980, Civil Action No. 80-C-124) and against the

Florida for Kennedy Committee in the U.S. District Court

for the Southern District of Florida (FEC v, Florida for

Kennedy Committee, Civil Action No. 79-5964,CIV-JLKI.

Complaint

The suits resulted from defendants' failure to comply

with subpoenas to produce information, which the FEC

had issued as part of an investigation of alleged violations of

the election law. 2 U.S.C. §437d. The FEC had received a

complaint from the Carter/Mondale Presidential Committee, Inc. on October 4, 1979, alleging that nine named

political committees were affiliated within the meaning of 2

5

U.S.C. § §433, 441 a(a){5j and 11 CFR 110.3(al(i)(ii)(D

The complaint claimed that, as affiliated political comm

tees, the nine committees were subject to a single $5,00

limit on contributions they accepted from a multicandida

committee. 2 U.S.C. §441 a(a)(1) (C)(2)(C). The complai

further alleged that the draft committees had received, an

MNPL had given to them, contributions in excess of th

$5,000 limit 2 U.S.C. §441a(al.

After finding reason to believe that the draft committe

and MNPL had violated the Act, the Commission issued 

subpoenas to various draft committees and to MNPL in 

effort to investigate the draft committees' alleged affi

ation.

Enforcement of the Subpoenas

Continued refusal by the four defendants to comp

with their subpoenas prompted the FEC to seek enforc

ment of the subpoenas in the U.S. district courts. The FE

argued that the subpoenas clearly conformed to the guid

lines for the enforcement of an administrative agency

subpoenas established by the Supreme Court in Unite

States v, Morton Salt Co. Specifically, the FEC's inquiri

were authorized by 2 U.S.C. §437dla)(1}, they we

not too indefinite and the information they sought w

reasonably relevant to the FEC's investigation. Further, 

seeking court-mandated enforcement of the SUbpoenas,th

Commission had followed the procedures prescribed by 

U.s.C. §437dlbl.

Defendant committees raised collateral issues that cha

lenged the Commission's jurisdiction over political comm

tees organized to draft candidates for federal office an

that raised First Amendment questions. Defendants argue

that, for purposes of the Act, the Supreme Court ha

restricted the definition of a "political committee" 

Buckley v, Va/eo to a group whose major purpose is 

influence the nomination or election of a candidat

(Buckley v. Valeo, 424 U.S. at 79.)

District Court Rulings

The district courts ordered enforcement of the Com

mission's subpoenas. The courts maintained that th

SUbpoenas met the guidelines for enforceability and we

within the authority of the agency.

The Wisconsin Democrats for Change in 1980 compli

with the Wisconsin district court's subpoena enforceme

order. However, Citizens for Democratic Alternatives 

1980 and MNPL filed notices appealing the D.C. distri

court's decisions to the U.S. Court of Appeals for th

District of Columbia Circuit, and the Florida for Kenned

Committee filed a notice appealing the Florida distri

court's decision to the U.S. Court of Appeals for the Fif

Circuit.

The Florida for KennedY Committee has not yet compli

with the FEC's subpoena because the appeals court for t

fifth circuit granted its application for a stay of the distri

court's order pending its appeal. The situation was differe

in the case of MNPL and Citizens for Democratic Altern

tives in 1980. The D.C. district and appeals courts deni

the stay applications requested by Citizens for Democrat

Alternatives in 1980 and MNPL; the Supreme Court al

denied a further application made by MNPL. The appellan

then produced all documents requested by the Commissio
D.C. Appeals Court Decision

On May 19, 1981, the appeals court for the D.C. circuit

issued its opinions in FEC v, MNPL and FEC v. Citizens for

Democratic Alternatives in 1980. The appeals court found

that the Commission "lacked subject matter jurisdiction

over the draft activities it sought to investigate." (FEC v.

MNPL, slip op, at 7; FEC v, Citizens for Democratic Alternatives in 1980, slip op, at 2). The appeals court vacated

the D.C. district court's orders enforcing the subpoenas and

remanded the cases to the district court for further proceedings consistent with its ruling. The appeals court

limited its decision to the provisions of the Federal Election

Campaign Act prior to the 1979 Amendments: "Whatever

the post-1979 situtation, it is clear to us that in this case

the contribution limitations did not apply to the nine

groups whose activities did not support an existing 'candi·

date.": (FEC v. MNPL, slip op, at 31). The court did note

that the 1979 Amendments to the Act appeared to require

that "draft" committees comply only with the Act's reporting requirements.

The appeals court departed from the standard for judicial

review of agency subpoenas and establ ished a new "extracareful scrutiny" standard for judicial enforcement of FEC

subpoenas. The appeals court reasoned that such a standard

was warranted since "the activities which the FEC normally

investigates differ in terms of their constitutional significance" from those of concern to other federal agencies.

On June 9, 1981, the Commission decided to seek review of

the D.C. appeals court's decisions by pstltloninq the

Supreme Court for a writ of certiorari.

Motions to Intervene Filed

On June 3, 1981, shortly after the D.C. appeals court

had handed down its decisions, the Democratic Senatorial

Campaign Committee and the Democratic Congressional

Campaign Committee filed a motion to intervene in the

FEC's suit against MNPL, claiming that the appeals court's

decision in the suit "dramatically and adversely" affected

their interests and those of the candidates they represented.

The committees argued that the "court's decision to

exclude 'draft' committees from the statute's contribution

limitation strikes at the very heart of the law and its proper

enforcement," creating two classes of political committees:

one which observes limits in collecting funds for a clearly

federal-election-related purpose, and one which observes no

such limits at all.

On June 5, 1981, the FEe filed a motion opposing the

Democratic Senatorial Campaign Committee's and the

Democratic Congressional Campaign Committee's joint

motion to intervene in the MNPL suit. The FEC argued

that it had exclusive primary jurisdiction over enforcement

of the Act and that the intervenors' petition was untimely

since it was filed after the appeals court had issued its

decision. The court's order on the motion has not yet been

entered.

6

JOHN B. ANDERSON v, FEe

On April 10, 1981, the U.S. District Court for 

District of Maine dismissed John B. Anderson v. 

(Civil Action No. 80-0272P) in response to a mo

to dismiss the suit filed by plaintiffs on the same day. 

suit had been remanded to the district court after certi

tion of constitutional questions to the U.S. Cour

Appeals for the First Circuit. Several plaintiffs - Joh

Anderson, a candidate in the 1980 Presidential electi

the National Unity Campaign 441a(d) Committee and t

individual plaintiffs - had brought suit on Septembe

1980, asking the district court to certify the follow

constitutional questions to the appeals court;

Does §441a(a)(1 )(B), which entitles a national p

committee to receive contributions of up to $20,000 

year from individuals, infringe on plaintiffs' First 

Fifth Amendment rlqhts: and

Does §441 ald), which permits a national party com

tee to make special "coordinated party expenditures

behalf of its Presidential candidate. infringe on plaint

First and Fifth Amendment rights?

Plaintiffs had also sought a preliminary injunction from 

district court, directing the Commission to permit 

application of Sections 441a{aj(1j(B) and 441a(d) to 

National UnitY Campaign 441 a(d) Committee, which 

registered as a political committee the day before plain

filed suit.

District Court Ruling

On October 14, 1980, the district court certi

plaintiffs' constitutional questions to the appeals c

but denied plaintiffs' motion for a preliminary injunct

The court held that plaintiffs had not exhausted the 

ministrative relief available to them under the election 

Moreover, the court noted that any injunction gran

would have been permanent, rather than temporary, s

the election would be held within two and one-half we

of its ruling.

Appeals Court Ruling

On October 30, 1980, the appeals court granted 

FEe's motion to remand the case to the district court 

further fact finding. The court noted that, if plaintiffs 

sought an advisory opinion from the FEC before filing 

the court" ...would likely have had more facts befor

than we do presently and would have been better able 

evaluate plaintiffs' constitutional claims."

Plaintiffs Seek Administrative Relief from FEe

On November 4, 1980, prior to seeking dismissal of t

suit. plaintiffs requested an advisory opinion from 

Federal Election Commission on the status of the Natio

Unity Campaign and the National Unity Campaign 441 

Committee as national party committees operating on 

Anderson's behalf. In AO 1980-131, issued on Novem

20, 1980, the Commission determined that neither comm

tee qualified as the national committee of a polit

party and, therefore, that neither committee was enti

to receive up to $20,000 in contributions from individ

or to make coordinated party expenditures. (See 

January 1981 issue of the Record for a summary of 

1980-131.1
•

NEW LITIGATION

FEC v. National Rifle Association of America

The FEC seeks a declaratory judgment from the U.S.

District Court for the District of Columbia that the National Rifle Association of America (NRA), an incorporated

association, the Institute for Legislative Action (ILAI,

NRA's lobbying organization, and the NRA Political

Victory Fund (PVF), NRA's separate segregated fund,

violated 2 U.S.C. §441b(a). Specifically, the FEC alleges

that:

NRA and 1LA made corporate expenditures in connection with the 1978 and 1980 Congressional elections

and the 1980 Presidential elections;

NRA and ILA made corporate contributions to PVF in

the form of advanced payments of expenditures on

behalf of PVF, for which they were later reimbursed by

PVF; and

PVF received corporate contributions by accepting (and

subsequently reimbursing) the advanced payments of

expenditures by NRA and ILA.

The FEC asks the court to permanently enjoin the NRA,

ILA and PVF from violating §441b(aJ in the future and to

assess a civil penalty of $5,000 against each defendant or, in

the alternative, to assess penalties equal to total prohibited

contributions made in 1978 and 1980.

(U.S. District Court for the District of Columbia, Civil

Action No. 81-1218, May 26,1981)

SUMMARY OF MURs

Selected compliance cases, Which have been closed and

put on the public record, are summarized in the Record.

Compliance matters stem from possible violations of the

Federal Election Campaign Act of 1971, as amended, which

come to the Commission's attention either through formal

complaints originating outside the Commission or by the

FEC's own monitoring procedures. The Act gives the FEC

the exclusive jurisdiction for the civil enforcement of the

Act. Potential violations are assigned case numbers by the

Office of General Counsel and become "Matters Under

Review" (M URs). All MUR investigations are kept confidential by the Commission, as required by the Act.

MURs may be closed at anyone of several points during

the enforcement process, including when the Commission:

Determines that no violation of the Act has occurred;

Determines that there is no reason to believe or no

probable cause to believe a violation of the Act has

occurred;

7

Enters into a conciliation agreement with the respo

dent;

Finds probable cause to believe a violation has occurr

and decides to sue; or

Decides at any point during the enforcement process 

take no further action.

After the MUR is closed and released by the Office 

General Counsel, the Commission makes the MUR f

available to the public. This file contains the complain

the findings of the General Counsel's Office and the Co

mission's actions with regard to the case, lncludlnq the fu

text of any conciliation agreement. The Commissio

actions are not necessarily based on, or in agreement wi

the General Counsel's analysis.

Selection of MURs for summary is made only from MU

closed after January 1, 1979. The Record article does n

summarize every stage in the compliance process. Rath

the summary provides only enough background to ma

clear the Commission's final determination. The full text 

these MURs and others which were closed between 19

and the present are available for review and purchase in't

Commission's Public Records Office.

MUR 1101: Contributions by Husband and Wife

On December 15, 1980, the Commission entered into 

conciliation agreement with an individual who, during 19

and again in 1979, had exceeded the $25,000 per year lim

on contributions by individual donors.

Complaint: On December 11, 1979, the Reports Analy

Division referred to the Office of General Counsel the nam

of an individual who appeared to have violated 2 U.S.

§441a(al(3) by contributing more than $25,000 to vario

party committees in both 1977 and 1979.

General Counsel's Report: In reviewing contribution info

mation on the G Index and reports filed by party com

mittees, the General Counsel discovered that the 

spondent had contributed $27,000 to party committe

during 1977 and $34.994 during 1979. The responde

filed a statement asserting that the contributions we

made from community property, held jointly by him a

his wife. Therefore, he maintained that 50 percent of ea

contribution should automatically have been attribut

to the respondent's wife. The General Counsel note

however, that Sections 104.8(c) and (d) of Commissi

Regulations stipulate that if a contribution in the form o

check (or other written instrument) is to count as a cont

bution from both a husband and a wife, both individua

must sign the check (or another written instrument 

companying the check) and specify that portion of t

contribution to be attributed to each.

The General Counsel concluded that, since the informati

required for joint contributions by spouses had not be

included on the respondent's contributions or in a

accompanying letters, the contributions could only 

attributed to the respondent - regardless of Californi

continu
community property laws. The General Counsel therefore

recommended that the Commission find probable cause to

believe the respondent had violated 2 U.S.C. §441 a(a)(3).

Commission Determination: On February 4, 1980, the

Commission determined there was reason to believe that

the respondent had violated 2 U.S.C. §441a{a)(3) by

making contributions totaling more than $25,000 in each

of two years: 1977 and 1979. On December 15, prior to

finding probable cause to believe the respondent had

violated the Act, the Commission entered into a conciliation agreement with him in which he agreed to pay a civil

penalty of $250 for the violation. The respondent also

agreed that he and his wife would file a joint statement

with each recipient committee, indicating their intent to

attribute one-half of the contribution to each spouse,

FEe PUBLISHES NAMES OF

PRESIDENTIAL NONFILERS

On May 1, 1981, as required by law, the Commission

published the names of five authorized Presidential committees that had failed to file their April quarterly reports

by April 15, 1981. Three of the committees, authorized by

1980 Presidential candidates, had failed to disclose financial

activity related to the 1980 Presidential elections. The

remaining two committees, authorized by 1976 Presidential

candidates, had failed to report activity for their 1976

Presidential campaigns. (Under the election law, a candidate's authorized campaign committee may terminate only

when its debts and obligations have been extinguished and

when all the debts of any affil iated authorized committees

have also been extinguished. 11 CFR 102.3.)

During the 1981 nonelection year, authorized committees

of Presidential candidates have the option of reporting

on a monthly or quarterly basis. (See p, 1 for reporting

requirements of Presidential committees.) The five committees cited by the Commission chose the quarterly

reporting option, but then failed to file the April quarterly

report on time.

FEC TESTIFIES ON IMPACT OF MEDIA

PROJECTIONS ON VOTER TURNOUT

On May 7, 1981, FEC Chairman John Warren McGa

testified before the Senate's Committee on Rules 

Administration concerning the impact of election p

jections made by broadcast media commentators on vo

turnout in 1980. He was accompanied by Dr. Gary Gre

halgh, Assistant Staff Director for the FEC's Informat

Services Division and Director of the FEC's Natio

Clearinghouse on Election Administration. In its testimo

the Commission noted that this issue was in need of "s

stantial additional study." There is no consensus on "

exact nature and extent of the impact of media elect

projections." Moreover, structural changes in the elect

system designed to eliminate the impact of media p

jections would have substantial cost impacts.

The Commission's testimony suggested that research 

analysis conducted on the issue should assess:

Whether med ia election projections actually affected 

turnout of voters at the polls - for both federal 

state or local elections;

Whether media election projections affected the turn

of one group of voters (e.g., voters identified by s

cationallevel or age) more than another; and

Whether media election projections affected the w

individualsvoted

The Commission offered a few cautionary notes:

- Surveys of voters, and nonvoters, can be very inaccura

- The memories of voters, and nonvoters, have a tende

to fade over time; and

Any study on voter turnout in the November 19

elections will have to distinguish the impact of me

election projections from the impact of Presid

Carter's concession speech.

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