11 STATISTICS: 1985-86 Independent Spending

Monthly

Monthly

Quarter

Pre-Prim

Pre-Prim

Report

Not File

SC

OH

NE

State

Volume 14, Number 

President

President

House

House

House

Office

Sought

20463

2 REPORTS: July Schedule

4 SPECIAL ELECTIONS: Illinois

4 ADVISORY OPINIONS

8 COURT CASES

TABLE OF CONTENTS

1 LEGISLATION

COMPLIANCE

Fernandez, B.

Martin-Trigona, A.

Hayes, R. H.

Pease, D.

Wilken, D. A.

Candidate

Nonfilers

FEC PUBLISHES NONFILERS

On April 29, the Commission published t

names of two House campaigns that had failed 

file disclosure reports required by the electi

law. See chart below.

The election law requires the agency to pu

lish the names of nonfiling candidates. Comp

ance actions against nonfilers are decided on 

case-by-case basis. The law gives the Comm

sion broad authority to initiate enforcement a

tions resulting from infractions of the law, inclu

ing civil court enforcement and imposition of ci

penalties.

9 COMPLIANCE: MUR Summary

10 INDEX

Washington DC

FEDERAL ELECTION COMMISSION

June 1988 999E Street NW

FEC RECOMMENDS CHANGES

IN ELECTION LAWS

On April 6, 1988, the Commission transmitted to Congress and the President 26 recommendations for legislative changes in federal

election laws. The recommendations would enhance the agency's ability to administer election

laws. The Commission is statutorily mandated to

submit recommendations each year "for any legis-

'Iative or other action the Commission considers

appropriate....n 2 U.S.C. §438 (a)(9).

Among the 26 proposals submitted this year

were two new proposals, which recom mended

that Congress:

o Clarify state filing provisions for P residen tial

candidate committees making expenditures in

the states; and

o Consider raising the threshold amount of

matchable contributions required to qualify for

Presidential primary matching funds.

A third proposal, offered for the first time in

1987, was modified to exclude committees authorized by candidates (candidate com mittees),

Under this proposal, other types of committees

(PACs and party committees) would no longer

have to file reports with state election offices.

Nor would the state offices have to maintain file

copies of these reports. Instead, state offices

would facilitate direct access to the FEC's computerized disclosure data base.

Other Com mission recorn mendations pertained to: definitions, registration and reporting requirements, enforcement, public financing, expenditure limits, contributions, fraudulent misrepresentations (i.e., fraudulent projects operated by

noncandidate committees and fraudulent solicitation of funds), honoraria and Commission information services.

The full text of the recommendations will be

published in the Com mission's 1987 Annual

Report. Copies of the recommendations are also

available from the FEC's Public Records Office,

999 E Street, N.W., Washington, D.C. 20463.
2

. 

. - 0_- 

JULY REPORTING SCHEDULE

The following chart and paragraphs explain the reporting schedule for the various categories of

filers. Questions and requests for additional forms should be addressed to Information Services,

Federal Election Commission, 999 E Street, N.W., Washington, D.C. 20463; or call 202/376-3120 or

toll free 800/424-9530.

x

x

Monthly

July 20

Volume 14, Number 

x

x

Report

Pre-Primary

x

x

x

x

x

Quarterly

July 15

FEDERAL ELECTION COMMISSION

Connected Organizations/

Cornmunlcatlonsf

1988 Congressional Cornmittees!

1988 Presidential Committees/

$100,000+ 2

1984 Presidential Committees3

1988 Presidential Committees/

Under $100,000

Parties and PACs/Quarterly4

National Party Convention

Committees6

Parties and PACs/Monthly4

June 1988

Type of Filer

lCongressional committees active in other years have only two reports covering 1988 activity:

the semiannual report, due on July 31, 1988, and the 1988 year-end report, due on January 31, 1989.

2presidential committees which have received contributions or made expenditures aggregating

$100,000 or more toward the 1988 Presidential cycle (or which anticipate this level of activity) must

file monthly reports during 1988, even if their candidate is no longer active in the 1988 campaign.

3presidential committees that are not active in 1988 elections may file on either a monthly or

quarterly reporting schedule. See 11 CFR 104.5(b)(2).

4All party committees and PACs ti.e., nonconnected committees and separate segregated funds)

are required to file on either a monthly or quarterly basis in 1988.

5Required only if the unauthorized committee makes contributions or expenditures on behalf of

candidates in the primary, which have not been previously disclosed.

6The Republican national convention committee must file a quarterly report by July 10, 1988.

The Democratic national convention committee's quarterly report is suspended. Instead, it must file a

post-convention report due no later than October 19, 1988. Se» 11 CFR 9008.12(b)(2)(i) and (ii).

7Report required if aggregate costs for partisan, internal communications for all 1988 primaries

have exceeded $2,000.
June 1988 FEDERAL ELECTION COMMISSION Volume 14, Number 6

3

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

D.C. 20463. Commissioners are: Thomas J. Josefiak, Chairman; Danny L. McDonald, Vice

Chairman; Joan Aikens; Lee Ann Elliott; John Warren McGarry; Scott E. Thomas; Walter J.

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

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

(TDD For Hearing Impaired 2021376-3136)

Quarterly Filers

Due by July 15, the report should cover all

activity from Apr-il 1 (or from the closing date of

the last report filed in 1988 or from the date of

registration,* whichever is later) through June 30.

Pre-Primary Filers

The report is due 12 days before the primary

election and must be complete as of the 20th day

before the election. If sent by registered or

certified mail, the report must be postmarked no

later than the 15th day before the election.

Monthly Filers

The monthly report must be filed by July 20.

It should cover all activity from June 1 (or from

the closing date of the last report filed in 1988 or

from the date of registration, * whichever is later)

through June 30.

CHANGE IN FILING FREQUENCY

P ACs and party com mittees which plan to

change their reporting schedule in 1988 (e.g.,

from quarterly to monthly) must notify the Commission by submitting a letter with the July

report. A committee may not change its filing

frequency more than once a year. 11 CFR

104.5(c). The FEC requests that Presidential

committees also inform the Commission in writing if they change to a monthly reporting schedule

because their respective campaigns receive or

spend more than $100,000 during 1988.

WHERE REPORTS ARE FILED

Committees must file all reports and statements simultaneously with the appropriate federal

and state officials. 11 CFR 108.5.

Filing with the Federal Government

1. The principal campaign committees of House

candidates and committees supporting or op-

"'In the case of an authorized candidate committee, from the date candidate status is established. The Committee must report all campaign

finance activity incurred by the candidate before

he/she authorized the committee; 11 CFR 101.3-

(a) and 104.3(0) and (b). However, activity which

occurred before 1988 must be reported separately.

posing only House candidates file with th

Clerk of the House, Office of Records an

Registration, 1036 Longworth House Offic

Building, WaShington, D.C. 20515. 11 CFR

l04.4(c)(3) and l05.I.

2. The principal campaign committees of Senat

candidates and committees supporting or op

posing only Senate candidates file with th

Secretary of the Senate, Senate Public Re

cords, Hart Senate Office Building, Room

232, WaShington, D.C. 20510. 11 CFR 104.4

(c)(2) and 105.2.

3. All other committees, including the princip

campaign committees of Presidential cand

dates, file with the Federal Election Com

mission, 999 E Street, N.W., Washington

D.C. 20463. 11 CFR 105.3 and 105.4.

Filing with State Governments

1. The principal campaign com mittees of Con

gressional candidates must file a copy o

every report and statement with the Secre

tary of State or the appropriate election

official of the state in which the candidat

seeks federal office. 11 CFR 108.3.

2. The principal campaign committees of Pres

dential candidates must file copies of repor

and statements with the Secretary of Stat

or the appropriate elections official of th

state in which the committee makes cam

paign expenditures. These reports must con

tain all financial transactions which apply t

that state during the reporting period co

vered. 11 CFR 108.2.

3. PACs and party commmittees making contr

butions or expendi tures in connection wit

House and Senate races file in the state i

which the candidate seeks election. The law

requires a copy only of that portion of th

report applicable to the candidatels) bein

supported. Committees supporting residen

tial candidates must file in the state(s) i

which the Presidential committee and dono

com mittee have their respective headquar

ters.
June 1988 FEDERAL ELECTION COIVIIV11SSl0N Volume 14, Numbe

_ T' ~" _ "_

. . . . . " - .

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• ~.-~ ,.... _ • __ • - - -- __ _ _ r· • 

, \ , .

I •.

- .

CHART I

Candidates Running Only in Primary Election

ILLINOIS SPECIAL ELECTIONS

On July 12, 1988, Illinois will hold a special

primary election in its 21st Congressional District

to nominate candidates to fill the seat vacated by

the death of Representative Melvin Price. A

special general election will be held on August 9,

1988.

Political committees authorized by candidates (candidate committees) who are participating in these special elections must file the appropriate pre- and post-election reports. The reporting schedule will depend on whether the candidate

participates in one or both elections. (See below.)

All other political committees which support

candidates in the special electionis) must also

follow the reporting schedule for the special election(s). Note that monthly filers supporting candidates in the special general election must also

file a post-general election report, if they have

not previously reported this general election

activity.

Report

Pre-primary

JUly quarterly

Period

Covered

4/1-6/22

6/23~/30

Registered/Certified Mail

Date*

6/27

7115

Filing

Date

6/30

7115

ALTERNATE DISPOSITION

OF ADVISORY OPINION REQUESTS

AOR 1987-35: Agreements Between Corporatio

and Political Committees to

Transmit Committees' Political

Message on "900" Telephone Line

On April 29, 1988, the Commission notified 

requester by letter that his request would not 

given further consideration because it failed 

provide a complete factual description of 

activity in question...• n 11 CFR 112.1(b) and (c).

AOR 1987-36: Candidate's Use of Aircraft Leas

By Bank

The requester withdrew the request on April 

1988.

AOR 1988-9: Nonconnected PAC's Allocation 

Expenditures for

Political/Nonpolitical Trips

On April 27, 1988, the Commission sent 

requester a letter notifying him that his requ

did not qualify for an advisory opinion because 

1) presented a hypothetical situation and 2) 

not include a complete description of 

organization's activities and personnel 11 C

112.l(b) and (c).

AOR 1988-15: Corporate Sponsorship of Voter

Education Program for Children

The requester withdrew the request on May 

1988.

ItReports sent by registered or certified mail

must be postmarked by the mailing date. Reports

mailed first class or hand delivered must be

received by the filing date.

CHARTH

Candidates Running in Primary

and General Elections

ADVISORY OPINION REQUESTS

The following chart lists recent requests 

advisory opinions (AORs). The· full text of ea

AOR is available to the public in the Comm

sion's Office of Public Records.

Report

Pre-primary

July quarterly

Pre-general

Post-general

October quarterly

Period

Covered

4/l~/22

6/23-6/30

7/1-7/20

7/21-8/29

8/30-9/30

Registered/Certified Mail

Date*

6/27

7115

7/25

9/8

10/15

Filing

Date

6/30

7/15

7/28

9/8

10/15

4

AOR

1988-19

1988-20

Subject

Solicitability of individuals particip

ting in company's employee stock ow

ership plan. (Date made public: Ap

13, 1988; Length: 2 pages, plus 1

page supplement)

Eligibility of corporation's field rep

sentatives for PAC solicitatio

(Date made public: April 25, 19

Length: 8 pages, plus 12-page supp

ment)
June 1988 FEDERAL ELECTIOI\J COMMISSION Volume 14, Number 

ADVISORY OPINIONS: SUMMARIES

Procedures for Apportioning

Shared Contribution Limits

When making contributions for federal elections, Telenet PAC must apportion half of a

contribution to the limit it shares with GTE's PAC

and half to the separate limit it shares with

United's PAC.

Telenet PAC's contributions may be made

only to the extent that the amount apportioned to

each affiliated PAC does not, when aggregated

with the affiliate's contributions to the same

candidate, exceed the affiliate's limits. If agreed

to by United PAC and GTE PAC, Telenet PAC

could, however, reapportion a given contribution

AO 1987-34: Solicitation of Restricted Class

of Joint Venture Partnership by

its Subsidiary

The Telenet Communications Corporation (Telenet) is solely owned by US Sprint Communications

Company (Sprint JV), a noncorporate joint venture

partnership between the GTE Corporation (GTE)

and United Telecommunications, Inc. (United).

(GTE and United each own a 50 percent interest

in Sprint JV and jointly manage the partnership.)

Since Sprint JV is affiliated with Telenet by

virtue of its sole ownership (and thus control) of

Telenet, a separate segregated fund established

by Telenet, Telenet PAC, may solicit the solicitable personnel of Sprint JV. 2 U.S.C. §441b(b)(3J;

11 CFR 102.5(a) and 114.5(g)(l). Moreover, either

Telenet or Sprint JV may sponsor a voluntary

payroll deduction plan to facilitate Telenet PAC

contributions by both organizations' solicitable

personnel, provided the plan complies with FEC

rules. 11 CFR 114.5(a)(l)-(5).

Since Telenet is also affiliated with United

and GTE by virtue of the corporations' joint

ownership of Sprint JV, Telenet PAC shares a

single contribution limit with the PACs of GTE

and United, respectively. 2 U.S.C. §441a(a)(5);

11 CFR lOO.5(g)(2) and 110.3(a)(l). The PACs of

GTE and United do not, however, share a single

limit because their joint venture, by itself, does

not make GTE and United affiliated with each

other. Under these circumstances, Telenet PAC

must apportion its contributions to the separate

limits it shares with the GTE and Union PACs.

See AO 1979-56 and the procedures described

below.

•

•

•

AOR

1988-21

Subject

Act's preemption of California ordinance limiting contributions from lobbyists. (Date made publics April 26,

1988; Length: 2 pages, plus lu-page

supplement)

5

between the limits it shares with each PAC 

avoid making an excessive contribution.

To help recipient candidates and com mitte

monitor the PACs' shared limits, Telenet PA

should provide written instructions on the lim

to recipient committees. Telenet should al

keep the instructions for three years as part of 

contribution records. 2 U.S.C. §44Ia(f); 11 CF

llO.9(a).

Finally, GTE PAC and United PAC will ha

to identify Telenet PAC as an affiliated PAC 

their respective statements of organization. Si

ilarly, Telenet PAC will have to identify 

affiliation with its two parent corporation PAC

2 U.S.C. S433(b)(2). The three PACs will, ho

ever, remain separate entities for reporting pu

poses. 2 U.S.C. §434(a)(4); 11 cFR 104.1(

Com missioners Joan D. Aikens and Lee Ann El

ott filed a joint dissent. Commissioner Scott 

Thomas filed a concurring oplnlon.. (Date issue

April 18, 1988; Length: 13 pages, including co

curring and dissenting opinions)

AO 1988-10: Individual and Group Activities

Related to Post-Primary

Delegate Selection

The election of precinct committee persons in t

May 17 Oregon Presidential primary would n

constitute an "election" or a level of the Pre

dential delegate selection process subject to t

Act and FEC regulations, The Presidential p

mary, however, would be an "election" SUbject 

regulation because it would be held to express 

Presidential nomination preference. 2 U.S.

S43l(1)(D). Consequently, while activities M

William E. Taylor and his associates plan 

undertake solely to influence their election 

precinct committee persons would not be SUbj

to the Act or FEC rules, certain activities th

may engage in to influence the outcome of t

Presidential primary would be subject to reg

lation. Finally, post-primary activities unde

taken by Mr. Taylor and his associates to infl

ence the selection of delegates to the Democra

National Convention would be considered part 

the delegate selection process. Thus, they wou

also be subject to the Act and FEC regulation

particularly the FEC's delegate selection rules.

I. Selection of Precinct Committee Persons

At the time it holds its Democratic Preside

tial primary, Oregon also elects Democratic pr

cinct committee persons to two-year term

Among their duties is the selection of delegat

to the Democratic National Convention and to 

state convention which, in turn, selects som

delegates to the Convention. Under these c

cumstances, activities undertaken by individu

solely for the purpose of promoting their electi

as precinct committee persons would not be co

continu
June 1988 FEDERAL ELECTION COMMISSION Volume 14, Number

sidered part of the delegate selection process

subject to the Act and FEC rules because: I) the

number of delegates apportioned to each Presidential candidate is determined by voters in the

Oregon Presidential preference primary-not by

precinct com mittee persons; and 2) although candidates for precinct committee person in the May

primary could declare a Presidential preference

on their respective filing papers, these preferences would not appear on the primary ballot.

2. Group Activities Supporting

Presidential Candidates

Regardless of whether Mr. Taylor and his

associates campaign for precinct com mittee persons, if they receive contributions or make expenditures in excess of $1,000 to influence the

Presidential primary, they will become a political

committee under the Act.

Activities Subject to Contribution Limits. In

addition to counting against the registration

threshold, payments to influence the election of a

Presidential candidate will also count against: I)

the $1,000 contribution limit for the Presidential

candidate and 2) the candidate's public funding

spending limits.* (Moreover, if these payments

are made in coordination with the candidate's

campaign, the campaign should report them as

both in-kind contributions and expenditures. II

CFR 109.1(c) and (d)(l) and 110.8(g).) Electioninfluencing payments would include:

o Payments for disseminating, through public political advertising, ** campaign materials that

advocate the election of the precinct committee person candidates and also refer to their

Presidential candidate; and

o Payments made to disseminate a Presidential

candidate's campaign materials, in conjunction

with either the campaign for precinct committee person or volunteer activity on behalf of

the Presidential candidate. 2 U.S.C. S441a(a)-

(7)(1J).

Activities Exempt from the Contribution

Limits. Mr. Taylor and his associates may also

engage in certain activities that are exempt from

the contribution limits and which would not count

• Publicly funded Presidential primary candidates are SUbject to both an overall spending limit

and state-by-state spending limits.

••Public political advertising, in this situation,

includes broadcasting, newspapers, magazines,

billboards and direct mail.

6

against their registration threshold as a politic

committee. These would include:

o Uncompensated volunteer services (along wi

living expenses associated with those services)

o Disbursements for any unreimbursed travel e

penses (under $1,000 per traveler, per electio

made by Mr. Taylor or his associates; and

o Disbursements for campaign materials that a

vocate their election and also refer to the

Presidential candidate but which are distribut

by volunteers. 2 U.S.C. S431(8)(B)(xi).

Allocation of Expenditures. Any expend

tures made for the campaigns of both the precin

committee person(s) and the Presidential cand

date would have to be allocated on the basis 

the benefit the candidates reasonably expected 

derive. The portion of expenditures allocated 

the Presidential candidate's campaign would ha

to be: l) made from funds permissible under th

Act and 2) reported by Mr. Taylor's group, once 

achieved political committee status. 2 U.S.

S431(8)(B)(xi)j II CFR 106.(a).

Affiliation of Committees. Commission re

ulations provide for the affiliation of committe

if the committees are established, finance

maintained or controlled by the same person. Th

regulations set out various factors considered 

determining affiliation. The Commission note

that it did not have sufficient facts to deci

whether affiliation would exist between Mr. Ta

lor's proposed group and a Presidential candidate

campaign. II CF R II 0.3(a)( l)(ii) and (iii).

3. Activities Subject to the

Delegate Selection Regulations

Since Oregon's post-primary conventions s

lect individuals to fill apportioned delegate slot

activities undertaken by Mr. Taylor and his ass

ciates to influence the selection of individuals 

delegates to the Democratic National Conventio

would be subject to the Act and FEC regulation

particularly the delegate selection regulation

See generally II CFR 110.14.* Accordingly, 

Mr. Taylor and his associates receive or spen

more than $1,000 during 1988 to influence th

delegate selection process, they would become 

political committee subject to the Act's registr

tion and reporting requirements.

The rules governing activities to influen

delegate selection provide that:

o Payments for campaign materials distributed b

volunteers are exempt from contribution an

expenditure limits;

• For a summary of the delegate selecti

regulations, see the November 1987 Record, p

1-4.
June 1988

g

FEDERALELECTION COMMISSION Volume 14, Number

o Payments to distribute a Presidential candidate's own materials are considered contributions to the Presidential candidate (and, in

some cases, expenditures by the Presidential

campaign as well); and

o Allocation rules must be observed, where an

activity benefits both the Presidential and committee person candidates.

The delegate selection rules also provide for

the affiliation of a delegate com mittee with a

Presidential candidate's committee and list factors that may be considered in determining such

affiliation. II CF R 11 O.14(j). The Com mission

noted that, although in this case it had insufficient information to address the affiliation issue,

it had focused on the issue in an advisory opinion

posing somewhat similar circumstances. See AO

198B-l. (Date issued: April 15, 1988; Length: 7

pages)

AO 1988-11: Solicitation of Teachers by

Trade Association of Schools

NATTS PAC, the separate segregated fund of the

National Association of Trade and Technical

Schools (~ATTS), a trade association representing

incorporated private schools engaged in vocational and technical training, may solicit teachers

employed by NATTS member schools, provided

the teachers:

o Are salaried employees of the school; and

o Are not represented by a labor union.

Under the Act and FEC regulations, a trade

asssociation or its separate segregated fund (PAC)

may solicit the stockholders and the executive

and administrative personnel of the assoclation's

corporate members, provided each corporate

member: 1) approves the solicitation in advance

and 2) has not approved a solicitation by another

trade association for the same calendar year. 2

U.S.C. S441b(b)(4)(D); 11 CFR 114.8(c).

For purposes of PAC solicitations, the Act

and FEC regulations define executive and administrative personnel as those individuals who: 1)

are employed by a corporation, 2) are paid on a

salaried, rather than an hourly, basis and 3) have

policy making, managerial, professional or supervisory responsibilities. 2 U.S.C. §441b(b)(7); 11

CFR 114. 1(c)(2)(i).

To determine whether an employee qualifies

as an executive or administrative employee, FEC

regulations state that the Fair Labor Standards

Act (FLSA) and its regulations may serve as a

guideline. II CFR 114.1(c)(4). Under FLSA

regulations, an "employee employed in a bonafide

professional capacity" includes:

o Any individual whose primary duty consists of

the performance of "teaching, tutoring, instructing, or lecturing";

o Any individual whose work requires the "consistent exercise of discretion and judgment (i.e.,

an individual whose work is "predominantly in7

tellectual in character"); and

o Any individual who is compensated more th

$170 per week. 29 CFR 541.3(1987).

The teachers employed by NATTS membe

qualify as professionals under FSLA rules becau

all perform "teaching" duties and earn in exce

of $170 per week.

Since FEC rules exclude professional emplo

ees who are represented by a labor organizati

from the term ·"executive and administrativ

personnel, NATTS PAC may not solicit tho

teachers who are so represented. II CF

114.I(c)(2)(i). (Date issued: April 15, 198

Length: 3 pages)

AO ]988-14: Joint PAC Sponsol'ed by

Affiliated Corporations

Two affiliated corporations, Atlantic Marine, In

(AMI) and Atlantic Dry Dock Corporation (ADD

may jointly sponsor a separate segregated fun

(l.e., a PAC) to accept contributions from th

solieitable personnel of both corporations and 

make contributions to federal elections. 2 U.S.

§441b(b)(4)(A)(l); 11 CFR 114.5(g). Under FE

regulations, however, an individual who is 

stockholder of AMI or ADD may not serve as 

custodian for the joint PACts twice year

solicitations of employees who are not executiv

or administrative personnel or stockholders 

either corporation. 11 CFR 114.6(d)(5); AO 197

49.

The official name of the joint PAC mu

include the full name of both corporations. 

U.S.C. §432(e}(5)j II CFR 102.l4(c). For exam

ple, an acceptable name would be "Atlantic M

rine, Inc. and Atlantic Dry Dock Corp. Separa

Segregated Fund." The joint PAC's full offici

name must appear on its Statement of Organiz

tion, on all FEC reports and on all its disclosu

notices. 11 CFR 109.3 and 110.11.

Affiliation of AMI and ADD

Under the election law, a PAC's corpora

sponsors are considered affiliated if one corpor

tion exercises direction or control over the other

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

(Although the election law specifically address

contribution solicitations by the separate PACs 

affiliated corporations, the law does not preclud

the case of solicitations by the affiliate

corporations' join t PAC.)

The relattonsnip between AMI and A DD sati

fies the indicia of affiliation. The same shar

holders own approximately 60 percen t of th

stock in both corporations. The two corporatio

have overlapping governing bodies; for exampl

they share many of the same officers and dire

tors. Finally, the same corporate officer handl

personnel matters for both corporations. (Da

issued: April 22, 1988; Length: 4 pages)
June 1988 FEDERAL ELECTION CQv1MISSION Volume 14, Number 

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ANTOSH Y. FEC (Second Suit·)

On March 24, 1988, the U.s. District Court

for the District of Columbia issued an order

granting the FEC's motion for summary judgment

in James Edward Antosh v. FEC (Civil Action No.

84-2737). The court's order dismissed the remaining two counts in Mr. Antosh's complaint, which

alleged that:

o The FEC's dismissal of his administrative complaint was contrary to law (Count 1); and

o Both the FEC and former FEC Commissioner

Thomas E. Harris* * had violated plaintiff's due

process rights in refusing to disqualify Commissioner Harris from the agency's consideration of

Mr. Antosh's administrative complaint (Count

ll).

Background

In an administrative complaint that Mr. Antosh filed with the FEC in December 1983, he

alleged that three political committees (the separate segregated funds of international unions that

are AFL-CIO members) were affiliated with the

AFL-Cro's separate segregated fund, AFL-Cro

COPE-PCC. As affiliated committees, Mr. Antosh alleged, the labor PACs had violated the

election law by:

o Failing to report their affiliation on their respective Statements of Organization (2 U.S.C.

S433(b)(2»; and

o Making contributions to federal candidates

which exceeded their combined $5,000 per election, contribution ceiling for each candidate (2

U.S.C. §441a(a)(2)(A».

After filing his administrative complaint with

the FEC, Mr. Antosh requested that Commissioner Harris disqualify himself from the agency's

consideration of the complaint because he had

acted as counsel for the AFL-CIO prior to his

appointment to the Commission in 1975. In March

1984, Commissioner Harris decided not to disqualify himself, a decision unanimously backed by the

full Commission.

In July 1984, the FEC adopted a recommendation by the General Counsel that there was no

reason to believe the union PACs had violated the

election law. The Commission then dismissed the

complaint.

..Mr. Antosh filed four other suits with the

FEC, which have been concluded.

....Mr. flarris' third term on the Commission

expired in April 1985. However, he continued to

serve on the Commission unttl Fall 1986, when he

was replaced as FEe Commissioner by Scott E.

Thomas.

8

On September 6, 1984, Mr. Antosh filed su

with the district court to challenge the FEe

dismissal of his administrative complaint. O

January 7, 1988, the court dismissed counts III a

IV of his complaint* on grounds that Mr. Anto

lacked standing to raise the issues contained 

the counts. (For a summary of the cour

decision, see o. 10 of the March 1988 Record.)

In its March 1988 opinion, summarized below

the court ruled on the remaining allegations co

tained in Mr. Antosh's complaint (Counts I and 11

Court's Second Ruling

FEG's Dismissal Not Contrary to Law. W

regard to Mr. Antosh'S allegation that the FEC

dismissal of his administrative complaint was co

trary to law (Count I), the court held that t

FEC had "reasonably interpreted" the provision 

the election law governing possible affiliati

between the political committees named in t

complaint. Consequently, the agency's dismiss

of the complaint was not contrary to law.

The FEe argued that the legislative histo

of section 441a(8)(5) demonstrated that Congre

had not intended to impose a single contributio

limit on the AFL-CIO's PAC and the PA Cs 

international unions affiliated with the AFL-CI

The agency noted that it had consistently inte

preted the provision this way.

The district court supported the FEC's view

noting comments made, in 1976, by Represent

tive Wayne Hays, then Chairman of the Hou

Ways and Means Committee and a sponsor of th

bill:

(I]t is clear in the language that international unions may be members of the

AFL-CIO, but that does not say that

international unions and the AFL-CIO

are to be treated as one. Just as corporations may have a PAC and also be a.

member of the Chamber of Commerce,

or its subsidiaries, any international

union in the states is also treated as 8.

[separate, unaffiliated] corporation with

its subsidiaries ....**

Commissioner Harris Need Not Have Bee

Disqualified from the Proceedings. Prior to h

appointment as Commissioner in 1975, Thomas E

Harris had served as counsel for the AFL-CIO

Mr. Antosh claimed that Mr. Harris had signed 

*In these two constitutional claims, M

Antosh aHleged that several provisions of th

election law and FEC regulations provid

preferential treatment to labor organizati

PACs, in violation of his lst and 5th amendme

rights. See p, 10 of the March 1988 Record.

USee 122 Congo Rec. 8573 (March 30, 197

(remarks by Rep. Hays)
June 1988 FEDERAL ELECTION COMMISSION Volume 14, Number

factual stipulation on behalf of the AFL-CIO in a

1973 case that was germane to Mr. Antosh's case.

With regard to Mr. Antosh's claim that Commissioner Harris should recluse himself from the

case, the court concluded that "the intervention

of significant numbers of years [nine] certainly is

sufficient to remove any taint." The court added

that it "refuseldl to find that an attorney, at the

very least nine years later, cannot consider cases

involving a former client, especially after the

Commission has made a determination that he or

she is capable of impartially addressing the individual facts of a case."

FEC v; BEAITY FOR CONGRESS COMMITI'EE

On March 21, 1988, the U.S. Court of Appeals

for the Second Circuit dismissed the appeal of

Edward Myers in FEC v. Beatty for Congress

Committee and Edward Myers (Civil Action No.

88-6011). The FEC and Mr. Myers had filed a

Stipulated Dismissal and Settlement Agreement

with the court.

By the terms of the agreement, Mr. Myers

will withdraw his appeal of the district court's

October 1987 decision in the case. The court's

decision denied Mr. Myers' motion to set aside the

default judg-ment the court had entered against

him in January 1987. That decision had imposed a

$5,000 civil penalty on defendants for each of 17

independent violations of the election law. (For a

summary of the court's 1987 decision, see page 6

of the March 1987 Record.)

In addition, the parties agreed that:

o Mr. Myers will pay a $15,000 civil penalty in

increments spelled out in the payment schedule

contained in the agreement. If he fails to meet

the payment schedule within the time frame

specified by the agreement, the FEC may reinstate the penalty originally imposed by the

district court, plus interest from the entry date

of the default judgment.

o After Mr. Myers makes the final penalty payment, the FEG will file a satisfaction of judgment notice with the court.

o By July I, 1988, Mr. Myers will file certain

original or amended reports for each year between 1983 and 1988. If Mr. Myers fails to file

the reports by July 1, 1988, or if the reports are

not adequately filled out, the FEC may increase

his civil penalty by $1,000 per month until the

reports are filed in compliance with FEC disclosure requirements.

Upon the acceptable filing of all the Beatty

committee's required reports, Mr. Myers will follow FEC procedures for requesting termination of

the com mittee.

9

NEW LITIGATION

FEC v, Dietl for Congress

The FEC asks the district court to decla

that Dietl for Congress, Richard B. Diet

principal campaign committee for his 1986 Hou

campaign, and Alan J. Dietl, , the eornmltt e

treasurer, violated the election law's disclosu

requirements by failing to file on time an Octob

quarterly report and .by failing to file a pr

election report for the 1986 election year.

The FEG asks the court to:

o Declare that the defendants, violated t

election law;

o Assess an. appropriate civil penalty .again

them; and

o Enjoin defendants from future violations of t

election law.

U.S. District Court for the Eastern Distr

of New York, Civil Action No. 88-1143, April 

1988.

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MUR 2153: Impermissible Deposit of Funds

In Party's Federal Account

This MUR, resolved through conciliation, involv

a state party's deposit of a fundraiser's nonfeder

proceeds into its federal account.

Complaint

The Commission initiated this matter bas

on a referral from the Audit Division concerning 

state party's deposit of funds, collected 

connection with state activities, into its feder

account.

General CounsePs Report

Pursuant to II CFR 102.5(a)(2), a politic

committee may deposit in its (federal) accou

only those contributions that: a) are designat

for the federal account, b) result from a solicit

tion stating that the contributions will be used 

connection with a federal election and c) a

given by contributors who have been inform

that all contributions are subject to the prohib

tions of the Act. The General Counsel conclud

that, since these conditions were not met, th

party violated 11 CFR 102.5(a)(2).

In connection with a joint fundraiser betwe

a local candidate and the state party committe

a total of $12,000 was deposited on two separa

occasions into the party's federal account. T

party contended that the money was erroneous

deposited and "the event and subsequent moni

had nothing to do with federal aetivities," F

continue
June 1988 FEDERAL ELECTION COMMISSION Volume 14, Number 

this reason, the General Counsel concluded that

the transaction was the result of a mistake rather

than any intent to evade the law. The General

Counsel recommended that the Commission enter

into conciliation with the respondents prior to

finding "probable cause to believe" that they had

violated the Federal Election Campaign Act (the

Act).

Commission Determination

Prior to finding "probable cause to believe"

the Act had been violated, the Commission entered into a conciliation agreement with the respondents. The respondents agreed to pay a $1,000

civil penalty," Moreover, before signing the

agreement, the state party had transferred the

$12,000 in question back to its nonfederal

account.

This cumulative index lists advisory

opinions, court cases and 800 Line articles published in the Record during 1988. The first

number in the citation refers to the "number"

(month) of the Record issue; the second number,

following the colon, indicates the page number in

that issue.

OPINIONS

1987-29: Partisan communications by incorporated membership organization, 4:6

1987-30: Assets of candidate's wife used to pay

off bank loan to candidate, 2:3

1987-31: Eligibility of security exchange's eight

membership classes for PAC solicitations, 3:5

1987-32: Campaign contributions in the form of

silver dollars, 3:7

1987-33: Law firm and partner are not government contractors, 3:7

1987-34: Solicitations by subsidiary of joint

venture partnership, 6:5

1988-1: Activity to influence delegate selection,

5:3

1988-2: FEC reports posted on security exchange's

bulletin boards, 4:7

1988-4: Affiliation of PACs through corporate

merger, 5:4

1988-5: Presidential matching payments used for

'84 debts, 5:5

1988-6: Allocation of media expenses to fundraising. exemption, 4-7

1988-10: Activities for post-primary delegate

selection, 6:5

10

1988-11: Solicitation of teachers by trad

association of schools, 6:7

1988-14: Joint PAC sponsored by affiliate

corporations, 6:7

COURT CASES

Ralph J. Galliano v, U.S. Postal Service, 1:7; 3:9

Harry Kroll v, Americans with Hart, lnc., 5:6

Xerox Corp. v, Americans with Hart, Inc., 5:6

FEC v".__-:-

-Augustina for Congress, 1:8

-Beatty for Congress Committee, 6:9

-Citizens for the President '84, 3:10

-Citizens to Elect Jerald Wilson for

Congress, 1:9

-Dietl for Congress, 6:9

-Dominelli (second suit), 5:8

-N ew York State Conservative Party State

Committee/1984 Victory Fund, et al., 2:7

v. FEC

-Antosh, 1:8; second suit, 3:10; 6:8

-Common Cause, 5:7

-Stark (second suit), 4:8

800 LINE

Last-Minute Contributions and Independent E

penditures, 2:4

CHANGE OF ADDRESS

Registered political committees are

automatically sent the Record. Any change

of address by a registered committee must,

by law, be made in writing as an amendment to FEC Form 1 (Statement of Organization) and filed with the Clerk of the

House, the Secretary of the Senate, or the

FEC, as appropriate.

Record subscribers (who are not political committees), when calling or mailing in

a change of address, are asked to provide

the following information:

1. Name of person to whom the Record is

sent.

2. Old address.

3. New address,

4. Subscription number. The subscription

number Is located in the upper left

hand corner of the mailing label. It

consists of three letters and five numbers. Without this number, there is no

guarantee that your subscription can

be located on the computer.
$5,000,000 -------------------------

Agains

1985-86

Volume 14,Number 

1983-84

expenditure must be made without co~peration o

consultation with the candidate or his/her cam

paign. Independent expenditures are not l!mite

as are contributions made directly to candida te

campaigns.

The FEC study a~o showed .that indeP7nd;

spending on Congressional candidates by indiv

duals and political committees rose from $2

million in the 1979-80 election cycle to $9

million in the 1985-86 cycle. Generally, indepen

dent spending was higher in Presidential electio

years, with most of that spending targeted t

Presidential races. See Chart II below for 

comparison of independent spending over fou

election cycles.

More detailed information on independen

spending in the 1985-86 election cycle is contain

ed in the FEC's March 31, 1988, press release an

in the independent expenditures volume entitle

FEC Index of Inde endent Ex enditures 1985-8

The volume is available at 10 per copy. T

Obtain a copy of the press release or t~

independent expenditures volum e, call the Publi

Records Office: 202/37 6-3140 or, toll free

800/424-9530. continue

For

11

1981-82

FEDERAL ElECTION COMMISSION

°

1979-80

June 1988

$1,000,000

$3,000,000 --------

$8,000,000

$9,000,000

$2,000,000

$6)000,000 --------------

$4)000,000 ----------.---

$7,000,000 ---.-----

. --.,....... .....--:=-- - -~~--:;-'.-::-~'-'-';:;""-- .~....... r-:-'--<,c""- .• ~"... - "-: --~-, ~~~

• Co.' • ,

: :.:" r ; y "~~'~L ,,>~.>.~~\;-.: ;3}~> " ':':' ~:~~.~' __ 0 •••_~~.:~__~~~ ..: ~~~ ~~. ~~_,.__ __:..~

STUDY ON 1985-86 INDEPENDENT SPENDING

SHOWS CHANGING PATTERNS

Independent spending which advocated the

defeat of federal candidates accounted for only

14 percent of the $10.2 million spent independently during the 1985-8? election cycle:-a sharp drop

in negative spending from previous elee tion

cycles. (See Charts I and II below.) The study

released by the FEC on March 31 also reported

that PACs sponsored by trade, membership and

health associations spent more money on

independent expenditures during the 19S5-86

cycle than in previous election cycles. By

contrast nonconnected com mittees totally

dominat~d the independent expenditures field in

previous cycles.

Under the election law, an "independent expenditure" is money spent to finance a communication that advocates the election or defeat of a

clearly identified federal candidate. Such an

CHART I

INDEPENDENT EXPENDITURES IN

CONGRESSIONAL ELECTIONS

•
FEDERAL ELECTION COMMISSION

Again

For

4

Volume 14, Numbe

Bulk Rate Mail

Postage and Fees Paid

Federal Election Commission

Permit Number G-31

3

Millions 01 Dollars

o 1

Against House Candidates

Against Senate Candidates

For Senate Candidates

For House Candidates

For Presidential Candidates

Official Business

FEDERAL ELECTION COMMISSION

999 E Street, NW

Washington, DC 20463

Against Presidential Candidates

June 1988

CHART II

INDEPENDENT EXPENDITURES IN ALL RACES, 1985-86