•

May1986

FEDERAL ELECTION COMMISSION

999 EStreet NW Washington DC 20463 Volume 12, Numb

•

•

PEC TESTIFIES ON FY 1987 BUDGET

nuring Congressional hearings held between

February 20 and April 23, 1986, FEC Vice Chairman John Warren ~1cGarry requested a $12.8

million budget for the Commission for fiscal year

(FY) 1987. Mr. McGarry, who also serves as

chairman of the agency's finance committee,

stated that the FEC's budget request "will give

[the agency] limited flexibility to build on progress to date."

Accompanied by FEC Chairman Joan D.

Aikens and Commissioner Thomas J. Josefiak,

vice chairman of the finance committee, Mr.

McGarry testified before four Congressional committees: the Subcommittee on Elections of the

Committee on House Admlnistratlon: the House

Committee on Appropriations' SUbcommittee on

Treasury, Postal Service and General Government; the SUbcommittee on Treasury, Postal Service and General Government of the U.S. Senate

Committee on Appropriations; and the Senate

Committee on Rules and Administration.

Vice Chairman McGarry testified that the

volume of campaign finance activity monitored by

the FEC during the 1983-84 Congressional election cycle had increased by one-third over the

activity of each of the two previous election

cycles (i.e., the 1979-80 Presidential cycle and

the 1981-82 Congressional cycle). Campaign finance activity in 1986 is expected to approxima te

1984 activity. Mr. McGarry predicted that in

1988, when the major parties' Presidential nominations may be contested by 20 or more publicly

funded candidates, "total spending will surely be

astronom leal,"

Mr. McGarry said that increases in campaign

finance activity have implications for the Commission's workload. FEC staff must: field more

information calls and press inquiries; process and

disclose more pages of campaign finance reports;

certify more public funds to Presidential candidates; and handle more complex legal issues

through the advisory opinion and enforcement

processes. "While improving our timeliness in the

face of a growing workload, we have also been

able to enhance both our disclosure and outreach

programs - up to this point that is," Mr. McGarry

stated.

Mr. McGarry explained that, during FY 1

the Commission was forced to react promptly 

unanticipated budget cuts resulting from the B

anced Budget and Emergency Deficit Reduc

Act of 1985. This cut followed an earlier Cong

sional reduction based on a proposed governm

wide salary cut, which never went into effe

"While the combined dollar amount is not sign

cant by overall government standards, these 

ductions [totaling $858,0001 proved to be 

tremely disruptive to a small, personnel-inten

agency such as ours," he said. For example, 

agency was forced to cut computerized disclo

services which are not mandated by law but w

the public has come to expect from the F

Budget cuts also required a further reduction 

programs of the National Clearinghouse on E

tion Administration, which had already been 

more than 90 percent since the late 1970's.

"Congress cut the agency's hUdqet reques

$323,000 on the assumption that a 5 percent 

would be imposed on all federal employees. T

assumption later proved false, but the Comm

sion's funds were not restored.

TABLE OF CONTENTS

LEGISLATION

1 FEC Testifies on Budget

2 ADVISORY OPINIONS

4 CLEARINGHOUSE

COURT CASES

4 FEC v. Elliott S. Maggin for

Congress Committee

5 New Litigation

5 COMPLIANCE

PUBUCATIONS

6 Com mittee Treasurers

PEC CONFERENCES

7 Candidates

8 Corporate/Labor

7 INDEX
May 1986 FEDERAL ELECTIOI\J COMMISSION

- - - - ---

, "- ,. , . ~" , "'

.: " • /., J l ]. . :""/

. - --

ADVISORY OPINION REQUESTS

The following chart lists recent requests for

advisory opinions. The full text of each AOR is

available to the public in the Commission's Office

of Public Records.

AOR Subject

1986-8 Contributions to candidate's 1982 Senate

campaign refunded by his 1986 Senate

campaign. (Date made publici March 20,

1986; Length: I page, plus 3-page supplement)

1986-9 Campaign funds used for legal expenses

pertaining to compliance with House

Rules. (Date made public: March 25,

1986; Length: 1 page)

1986-10 Affiliated status of two nonconnected

PACs using same consulting firm. (Date

made public: April 2, 1986; Length: 2

pages)

1986-11 Act's preemption of state law governing

Congressional campaign's logo. (Date

made public: April 2, 1986; Length: 1

page, plus l-page supplement)

1986-12 Funds transferred from former Representative's 1984 House campaign to retire debts of her 1986 Senate exploratory

committee. (Date made public: April 3,

1986; Length: 1 page, plus 5-page supplement)

1986-13 Eligibility of trade association's corporate members for financing PAC fundraisers. (Date made public: April 4, 1986;

Length: 4 pages plus 39-page supplement)

\blume 12, Numbe

ADVISORY OPINIONS: SUMMARIES

An Advisory Opinion (AO) issued by the Co

mission provides guidance with regard to t

specific situation described in the AOR. A

qualified person who has requested an AO a

acts in accordance with the opinion will not 

subject to any sanctions under the Act. Oth

persons may rely on the opinion if they a

involved in a specific activity which is indisti

guishable in all material aspects from the activi

discussed in the AO. Those seeking guidance f

their own activity, however, should consult t

full text of an AO and not rely only on t

summary given here.

AO 1986-6: Multicandidate Committee Established by the Vice President for

Party Building and Support of

FederaIlNonfederal Candidates

Vice President George Bush is the founder an

honorary chairman of the Fund for Amertca

Future, Inc. (the Fund), a nonconnected politic

committee which was established in 1985 to su

port the Republican Party and Republlcan cand

dates at the local; state and federal levels. Sin

Vice President Bush will not consider a potenti

Presidential candidacy until after the 1986 ele

tions, he has neither established a tasting-th

waters fund nor authorized the Fund to ma

expenditures or engage in activities on behalf 

his potential candidacy.

During 1986, as the election season pr

gresses, Vice President Bush will be involved in 

number of party-building and direct candida

support activities on behalf of the Fund. If t

Vice President engages in the Fund-sponsor

activities described below, the Fund's expend

tures .for these activities will not be allocable 

his potential candidacy for federal office in 198

provided the activities are restricted in the wa

described by the Fund in its advisory opini

request (i.e., the activities do not promote Vi

President Bush's potential candidacy).

The Commission noted that its conclusi

applies only to expenditures the Fund makes f

activities the Vice President participates in b

fore he qualifies as a candidate under the electi

law.

I. Candidate and Party Appearances

Travel expenses the Fund absorbs for t

Vice President's appearances at party function

candidate rallies, fundraisers and hospitality sui

gatherings will not .be allocable to his potenti

The Record is published by the Federal Election Commission, 1325 K Street, N.W., Washington,

D.C. 20463. Commissioners are: Joan D. Aikens; Chairman; John Warren McGarry, Vice Chairman;

Lee Ann Elliott; Danny Lee McDonald; Thomas E. Harris; Thomas J. Josefiak; Jo-Anne L. Coe, 

Secretary of the Senate, Ex Officio; Benjamin J. Guthrie, Clerk of the House of Representatives,

Ex Officio. For more information, call 202/523-4068 or toll-free 800/424-9530.

2
FEDERAL ELECTIOI\J COMMISSION

•

•

•

May 1986

candidacy in 1988, provided these public appearances do not include:

o Any public references to the Vice President's

potential candidacy (e.g., possible intent to

campaign in 1988) or to the candidacies of his

potential opponents;

o Any solicitations on behalf of his candidacy;

o Any meetings with individuals and with the

press regarding his candidacy or the formation

of a campaign organization; or

o Any campaign paraphernalia distributed in support of his candidacy.

Any reference to the Vice President's potential

candidacy must be incidental, i.e., incidental contacts and incidental remarks, such as responses to

questions. 11 CFR 106.1(a) and (b).

2. Publications and Solicitations

Commission Regulations provide that a political com mittee's expenditures for newsletters

and fundraising solicitations need not be attributed to individual candidates, unless these expenditures are: 1) made on behalf of a clearly

identified candidate and 2) can be directly attributed to that candidate. 11 CFR 106.1(c)(l). The

Fund's expenditures for publications that describe

the Fund's purposes and solicit contributions to

the Fund need not be allocated to the Vice

President's potential candidacy. The materials

will not refer to his potential candidacy. Nor will

the materials suggest that contributors will be

viewed as early supporters of his candidacy.

Rather, the publications will merely note Vice

President Bush's association with the Fund and his

desire for individuals to contribute to the Fund as

a means of supporting Republican candidates and

the Republican party.

3. Steering Committees

The Fund has established steering com mittees to involve party officials, leaders and officeholders in the Fund's activities and to solicit their

advice on candidate support. The Fund need not

allocate expenditures for the steering com mittees

to Vice President Bush's potential candidacy in

1988, provided:

o The steering committees do not promote Mr.

Bush's potential candidacy by forming a campaign organization on his behalf or by influencing his nomination (e.g.; by participating

in the delegate selection process on his behalf);

and

o The steering committees will not make support

for Mr. Bush's potential candidacy a requirement for the committees' aid to Republican

candidates and organizations.

4. Volunteer Program

To assist Republican candidates and partybuilding activities (local, state and federal) during

1986, the Fund has been recrUiting volunteers and

3

Volume 12, Numt

conducting volunteer programs outside the W

ington, D.C. area. Expenditures the Fund ma

for these volunteer training programs will not 

allocable to Vice President Bush's potential can

dacy. 11 CFR l06.l(c)(2). The activity will not 

conducted to:

o Establish a campaign organization for V

President Bush; or

o Participate in the Presidential nomination p

cess--such as delegate selection-on his beha

However, if the Fund conducts volunteer 

tivities that aid other clearly identified fede

candidates, some of its expenditures may be a

cable to those candidates.

5. Precinct Delegate Recruitment and Assistan

The Fund plans to recruit and offer finan

assistance to individuals who seek election 

Republican precinct delegates in Michigan's 

gust 1986 precinct delegate election. In additi

the Fund will disseminate information with reg

to this election. Expenses the Fund incurs 

these specific activities will not be conside

contributions or expenditures to influence 

nomination or election of Vice President Bush

of any other candidate, for federal office. 

will the Fund's expenditures: 1) be allocable 

any federal candidate or 2) trigger his/her can

dacy.

The Act and FEC Regulations govern o

those delegate selection activities related to 

tional nominating conventions because contri

tions and expenditures made in conjunction w

such activities are for the purpose of influenc

a federal election. Individuals seeking election 

precinct delegates are not necessarily or p

sumptively seeking positions as national or st

convention delegates in 1988. Election as 

precinct delegate is not a requirement for sel

tion as a delegate to the Party's national nomi

ting convention in 1988. Furthermore, individu

seeking election as precinct delegates will not 

identified on the ballot as committed to or s

porting any potential Presidential candidate. N

is such a commitment a requirement for select

as a delegate. Finally, individuals elected as p

cinct delegates in 1986 will not select natio

convention delegates. Rather, they will sel

delegates to a 1988 state party convention whi

in turn, will choose the national convention de

gates.

The Commission noted that, should the Fun

support for potential precinct delegates exc

those activities described in its advisory opin

request, a different conclusion might be w

ranted. Vice Chairman John Warren McGarry 

Commissioner Thomas E. Harris each filed a d

sent. (Date issued: March 14, 1986; Length: 

pages, including dissents)
May 1986 FEDERAL ELECTION COI\J1I\J1ISSI01\J

CAMPAIGN FINANCE LAW86:

A SUMMARY OF STATE CAMPAIGN

FINANCE LAWS

Rec~ntly published. by the Clearinghouse, this volume con tams state contribution and solicitation limitations, expenditure limitations, reporting requirements

and other campaign finance information,

with citations to the respective state codes

and quick reference charts.

To purchase your copy, indicate the

title and order number 052-006-000-35-0,

and. make your check or money order for

$19.00 payable to Superintendent of Documents.

Send your order to:

Superintendent of Documents

U.S. Government Printing Office

Washington, D.C. 20402

1986 CLEARINGHOUSE PROJECTS

The FEC's National Clearinghouse on Election Administration serves as a central exchange

point for research and information regarding the

administration of federal elections. A staff of

four provides information services to state and

local election agencies by publishing research

studies, conducting workshops and responding to

telephone and letter inquiries.

Under the guidance of Penelope Bonsall, appointed as director in July 1985, the Clearinghouse currently is focusing on. three on-going

projects discussed below.

Voting System Standards

The first volume of a study on voting system

standards addresses standards for hardware components. The second and third volumes, now under

way, will consider, respectively, software standards and management guidelines for punchcard

and marksense voting systems. The project is the

result of an earlier study conducted by the Clearinghouse in 1983 in response to a specific request

from Congress. The 1983 study, entitled Voting

System Standards: A Report to the Congress on

the Feasibility of Developing Voluntary Standards

for Voting Equipment, noted that the proliferation

of voting devices had created a compelling need

to develop minimum standards for use by the

states in assessing a voting system's reliability,

security and performance. In recognition of this

need, the Clearinghouse began a long-term commitment in September 1984 to develop standards

for voting devices.

4

'vtlume 12, Numte

Voting Accessibility Act

Congress granted the Commission new 

sponsibilities under the Voting Accessibility 

the Elderly and Handicapped Act, signed by t

President on September 28, 1984. The Act stip

lates that registration and polling places for fe

eral elections must be accessible to handicapp

and elderly individuals. For the next five electi

cycles, the states will report to the Commiss

on the accessibility of polling places, giving re

sons for the inaccessibility of any 'particular si

The Clearinghouse will consolidate this inform

tion in annual reports to Congress beginning 

1987, following the 1986 elections.

Computerizing Election Administration

This three-volume project will pool state-

the-art information on using computers to adm

ister elections. During 1985, the Clearinghou

published Computerizing Election Administratio

Volume I, Current Applications. During 1986

second volume will be published which present

comprehensive computerized election syst

model that can be implemented incrementally. 

third volume is currently under way on how 

implement. computerized election systems th

respond to varied situations (e.g., shared vers

in-house computer equipment),

·FEC v. ELLIOTT S. MAGGlN FOR CONGRESS

COMMITTEE

On April 2, 1986, the U.S. District Court 

the District of New Hampshire found in defa

the Elliott S. Maggin for Congress Committ

.(the Committee), the principal campaign comm

tee for Mr. Maggin's 1984 House campaign. T

Committee had failed to respond to a compla

filed against it by the FEC on January 29, 19

(FEC v. Elliott S. Ma in for Con ress Comm

tee; Civil Action No. C86-40-L

In its complaint, the FEe had asked the co

to:

o Declare that the Committee and the Comm

tee's treasurer, Andi T. Johnson, had violat

the election law by failing to file a quarter

report on time (2 U.S.C. §434(a)(2)(A)(iii));

o Assess civil penalties against each defenda

amounting to the greater of $5,000 or an 

mount equal to 100 percent of the amou

involved in the violation; and

o Permanently enjoin defendants from furth

violations of the election law.
FEDERAL ELECTION COMMISSION

•

May 1986

NEW LITIGATION

FEC v. Pryor for Congress Committee

The FEC asks the district court to:

o Declare that the Pryor for Congress Committee, the principal campaign committee for

Nancy Pryor's 1984 House campaign, violated

the election law by failing to file quarterly and

pre-general election reports with the Commission (2 U.S.C. §§434(a)(2)(A)(i) and (Ui»j

o Assess a civil penalty against the defendant

amounting to the greater of $5,000 or an amount equal to 100 percent of the amount

involved in each violatlom and

o Permanently enjoin defendant from further violations of the election law.

U.S. District Court for the Western District

of Pennsylvania, CA86-580, March 18, 1986.

\blume12, Number 5

PUBLIC APPEARANCES

5/7 Minnesota State Conference

Minnesota Ethical Practices

Board and the Office of the

Secretary of State of Minnesota

St. Paul, Minnesota

Chairman Joan D. Aikens

Bradley Litchfield, Assistant

General Counsel

Bobby Werfel, Chief

Information Services

Paul Kolesa, PUblic

Affairs Specialist

5/7 Hope College

Washington, D.C.

Vice Chairman John Warren

McGarry

•

FEC PUBLISHES ILLINOIS NONFILERS

On March 14, 1986, as required by the election law, the Commission published the names of

two Illinois campaigns for the House of Representatives that had failed to file the pre-primary

report required for the March 18, 1986, Congressional primary. Due by March 6 (or March 3 if

sent by certified mail), the pre-primary report

should have covered activity from January 1

through February 26.

Commission compliance actions against nonfilers are decided on a case-by-case basis. The

election law gives the Commission broad authority to initiate enforcement actions resulting from

infractions of the law, including civil court enforcement and imposition of civil penalties.

5/12-13

5/29-30

6/6

6/20

Practising Law Institute

Washington, D.C.

Chairman Joan D. Aikens

Charles N. Steele, General

Counsel

Kenneth Gross, Associate General

Counsel

Mini Conference for Candidates

Federal Election Commission

Washington, D.C.

Chairman Joan D. Aikens

Vice Chairman John Warren

McGarry

FEC Staff

FEC Conference for Corporations

and Labor Organizations

George Mason University

Fairfax Virgina

Commissioners and Staff

•

5

6/27 Investigative Reporters and

Editors

Portland, Oregon

Kent Cooper, Assistant Staff

Director for Disclosure
FEDERAL ELECTION COMMISSION

FEC and Federal Election Law

Brief overview of major provisions o

Federal Election Campaign Act and the Com

sion's role in administering it.

Please indicate quantity in box to left of each item

Volume 12, Num

Brochures

Toll Free: 800/424-9530

Local: 202/376-3120

Federal Election Commission

Information Services

WaShington, D.C. 20463

Congressional Corporations and

Candidates Labor Organizations

Party Committees Nonconnected

Committees

General

Federal Election Bookkeeping Manual

Campaign Laws for Candidates

FEC Regulations Annual Report

FEC Record

(subscriptlcnI

Order Form

Campaign Guides

Phone:

Mail to:

Adviso ry Opl nions Local Party

Activity

Candidate Political Ads

Registration and SOlicitations

commlnee Public Funding of

Treasurers- Presidential Elections

Contributions Slate Elections &

Federel Canpaign LS'N

Corporate/Labor Trede Associations Commu nic8tio ns

Corporatel Labor Using FEC Campaign

Facilities Finance Information

FEC and Federal Volunteer Activity ElectiOn Law

Independent

Expenditures

NAME

STREET

CIT V, STATE, ZIP CODE

CONNECTED ORGANIZATION IPHONE (Optional)

I

Using FEe Campaign Finance Information

Brochure explaining how to gather inf

tion on financial activity of political comm

and candidates by using reports and FEC's co

ter indexes.

6

May 1986

FEC Record

Monthly newsletter covering reporting, advisory opinions, litigation, legislation, statistics,

regulations, cornptlance, Federal Register notices,

FEe procedures and staff, and publications.

House and Senate Bookkeeping Manual

Recommended method of bookkeeping and

reporting for Federal candidates and their committees.

/- ~~v~~~ 4~~ v- '---'\ - ~-- ~~::-- -~~ 4:~-; :--,~,

~: '-o~-'i"':,(~ -"-{-J-" r.: '~:;~r~l'r''''~ ~~, :> '. r

J

t t J .:. ) J •• :~/ ;; ,,? ~c-" . ~ '& 0." .~. ~r I I t ~, { •\ 1.J J \ ', ~t (... ~"

, rv s

~_f_" _ .~~ __ • ~~_ ... _ _ __ ~_~ __ ~~'-;,. ._ ......."'"'"__•

COMMITTEE TREASURERS

BROCHURE NOW AVAILABLE

During March, the Commission published

Committee Treasurers. a new brochure to help

treasurers of political committees carry out their

duties under the federal election law.

Before a political committee conducts financial activities, it must have a treasur-er, who is

responsible for the committee's compliance with

the law. The brochure briefly explains the treasurer's responsibilities and liability under the law

and summarizes procedures for designating an

assistant treasurer and other committee officers.

Finally, the brochure provides a convenient index

to provisions of the election law and FEC Regulations governing treasurer's responsibilities.

Copies of Committee Treasurers and other

brochures may be obtained free of charge from

the FEC's Information Services Division, 202/376-

3120 or toll free 800/424-9530.

Campaign Guides

Clear explanation and illustration of election

law requirements. Separate Guide for:

Congressional Candidates and Committees

Party Committees

Corporations and Labor Organizations

Nonconnected Political Committees

Federal Election Campaign Laws

Complete compilation of Federal election

campaign laws prepared by FEC.

FEC Regulations (II CFR)

FEC regulations; subject indexes prepared by

FEC.

FREE PUBLICATIONS

The FEC offers the following free publications. To order, return the completed form below.
FEDERAL ELECTION COIVIMISSIOI\J \blume 12, Numoo- 5

REMINDER:

MINI CONFERENCE FOR

CANDIDATES

A Mini Con ference for candidates

will be held in ~Vashington, D.C. on

May 29-30 (mornings only) and repeated on June 6 (all day). The series

will consist of two workshops, an introductory session covering candidate

support and reporting and an advanced

course covering common problems to

avoid and joint fundraising. There is a

$10 registration fee to cover refreshments. Because space is limited, preregistration is required. For more information, see the April issue of the

Record or call Ian Stirton at 800/424-

9530 or 202/376-3120.

COURT CASES

Antosh v, FEC, 3:8

FEC v; American International Demographic

Services, lnc., 4:8

FEC v, Californians for Democratic Representation,3:8

FEC v; Citizens Party, 3:8

FEC v, Eldredge, 1:10

FEC v, Haley, 1:11

FEC v. MAPAC, 1:10

FEC v, NRA, 1:11

FEC v; Sailors' Union of the Pacific Fund, 2:3

FEC v, Wolfson, 4:8

Gramm v. FRC; FEC v, Gramm,

1:10

Alwin Hopfman v, FEC, 2:3

7

800 LINE

Designating a principal campaign committee,

3:5

Transfer of candidate funds from state to federal committee, 1:8

OPINIONS

1985-26: Corporation's distribution of employee's political message, 1:7

1985-31: Affiliation between insurance corporation and agencies for purposes of PAC solicitations, 2:2

1985-32: Proceeds of reception beyond Act's

purview, 1:7

1985-33: Personal loans to candidate for campaign, 1:7

1985-34: Nonconnected PAC's use of proceeds

from life insurance policy, 1:8

1985-35: Solicitability of corporate board members, 1:8

1985-37: Affiliation of local Chambers of Commerce with State Chamber, 3:1

1985-38: Committee established by candidate

for state and local candidates, 3:2

1985-39: Bank ad in political journal, 2:2

1985-40: PAC's spending for Presidential

testing-the-waters activities, 3:2

1985-41: Contribution for general election accepted prior to primary, 2:3

1985-42: Campaign funds used to pay candidate's rent, 3:4

1986-1: Vendor's offer to provide free tickets to

committee, 4:6

1986-2: Candidate's sales campaign, 4:6

1986-4: Corporation's program to encourage

employee contributions, 4:6

1986-5: Excess campaign funds transferred

from candidate's federal to local committee,

4:7

1986-7: Cooperative PAC's shareholder solicitation program, 4:7

This cumulative index lists advisory opinions,

court cases and 800 Line articles published in the

Record during 1986. 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.

"T

• May 1986

•

•

•
FEC WILL SPONSOR CONFERENCE IN WASIDNGTON, D.C. AREA

On Friday, June 20, 1986, the FEC will sponsor a one-day conference at George Ma

University, Fairfax, Virginia, which focuses exclusively on the activities of corporations and lab

organizations. The conference will include sessions on: the basics about PACs, such as setting 

a PAC; PAC reporting requirements; corporate and labor fundraising; and corporate and lab

involvement beyond the PAC, such as sponsoring partisan and nonpartisan communications.

The registration deadline for the conference is June 6, 1986. For more information, conta

the FEC at 202/376-3120 or toll free at 800/424-9530.

\kJlume 12, Num

Bulk Rate Mail

Postage and Fees Paid

Federal Election Commission

Permit Number G-31

FEDERAL ELECTION COMMISSION

Official Business

FEDERAL ELECTION COMMISSION

999 E Street NW

Washington, D.C. 20463

May 1986