Federal Register / Vol. 70, No. 21 / Wednesday, February 2, 2005 / Proposed Rules 5385

apparent authority from the definition 

of agent? 

Alternatively, rather than either 

excluding apparent authority altogether 

from the definitions of agent at 11 CFR 

109.3 and 300.2(b) or simply adding the 

term ‘‘apparent authority’’ to these 

definitions, should the Commission 

instead provide a more narrowly 

tailored definition of agent? Before the 

Commission adopted the definition of 

agent in the soft money regulations in 

2002, the Commission’s former 

regulations contained a narrowly 

tailored definition of agent that 

included certain aspects of apparent 

authority. Specifically, former 11 CFR 

109.1(b)(5) defined agent as including 

‘‘any person who has been placed in a 

position within the campaign 

organization where it would reasonably 

appear that in the ordinary course of 

campaign-related activities he or she 

may authorize expenditures.’’ Former 11 

CFR 109.1(b)(5) appears to be narrower 

than the revision proposed in this 

NPRM because it does not include cases 

where apparent authority exists for 

persons other than those who hold a 

position ‘‘where it would reasonably 

appear that in the ordinary course of 

campaign-related activities he or she 

may authorize expenditures.’’ Under the 

proposed revision of the definitions of 

agent, which would add the term 

‘‘apparent authority’’ and rely on the 

Restatement for the definition of the 

term, a principal potentially could 

invest a person with the authority of an 

agent also by making statements to, or 

engaging in conduct with respect to, a 

third party, regardless of the position 

the putative agent occupies within the 

principal’s organization. Should the 

Commission re-adopt the definition of 

agent at former 11 CFR 109.1(b)(5)? Or 

would that definition be either too 

narrow or too broad to effectuate the 

purposes of BCRA’s soft money and 

independent and coordinated 

expenditures provisions? Would former 

11 CFR 109.1(b)(5) be more or less 

effective than the proposed revision in 

preventing circumvention of the Act 

and the appearance of corruption? 

Alternatively, the Commission seeks 

comments on whether it should adopt 

an entirely new approach towards 

apparent authority, different from both 

the definition at former 11 CFR 

109.1(b)(5) and the Restatement. 

Commenters who propose such a new 

approach should explain how their 

proposal would be more effective than 

both the revision proposed in this 

NPRM and former 11 CFR 109.1(b)(5) in 

implementing the purposes of BCRA’s 

soft money and independent and 

coordinated expenditures provisions, 

and how a wholly new approach would 

prevent circumvention of the Act and 

the appearance of corruption. 

Finally, although the Commission 

proposes to have consistent definitions 

in both 11 CFR 109.3 and 300.2(b), the 

Commission also solicits comments on 

whether effective implementation of 

BCRA’s purposes would be better served 

by defining agent in the soft money 

context differently from agent in the 

coordination context and, specifically, 

whether apparent authority should be 

included in one but not in the other 

definition. 

Certification of No Effect Pursuant to 5 

U.S.C. 605(b) (Regulatory Flexibility 

Act) 

The Commission certifies that the 

attached proposed rules, if promulgated, 

would not have a significant economic 

impact on a substantial number of small 

entities. The basis for this certification 

is that the national, State, and local 

party committees of the two major 

political parties, and other political 

committees are not small entities under 

5 U.S.C. 601 because they are not small 

businesses, small organizations, or small 

governmental jurisdictions. Further, 

individual citizens operating under 

these rules are not small entities. To the 

extent that any political party 

committees or other political 

committees may fall within the 

definition of ‘‘small entities,’’ their 

number is not substantial.

List of Subjects 

11 CFR Part 109 

Elections, Reporting and 

recordkeeping requirements. 

11 CFR Part 300 

Campaign funds, Nonprofit 

organizations, Political candidates, 

Political committees and parties, 

Reporting and recordkeeping 

requirements.

For the reasons set out in the 

preamble, the Federal Election 

Commission proposes to amend 

subchapters A and C of chapter I of title 

11 of the Code of Federal Regulations as 

follows:

PART 109—COORDINATED AND 

INDEPENDENT EXPENDITURES (2 

U.S.C. 431(17), 441a(a) AND (d), AND 

PUB. L. 107–55 SEC. 214(c)) 

1. The authority citation for part 109 

would continue to read as follows:

Authority: 2 U.S.C. 431(17), 434(c), 

438(a)(8), 441a, 441d,; Sec. 214(c) of Pub. L. 

107–55, 116 Stat. 81. 

2. Section 109.3 would be amended 

by revising the introductory text of the 

section to read as follows:

§ 109.3 Definitions. 

For the purposes of 11 CFR part 109 

only, agent means any person who has 

actual authority, either express or 

implied, or apparent authority to engage 

in any of the following activities on 

behalf of the specified persons:

* * * * *

PART 300—NON-FEDERAL FUNDS 

3. The authority citation for part 300 

would continue to read as follows:

Authority: 2 U.S.C. 434(e), 438(a)(8), 

441a(a), 441i, 453.

4. Section 300.2 would be amended 

by revising the introductory text of 

paragraph (b) to read as follows:

§ 300.2 Definitions.

* * * * *

(b) Agent. For the purposes of part 300 

of chapter I, agent means any person 

who has actual authority, either express 

or implied, or apparent authority to 

engage in any of the following activities 

on behalf of the specified persons:

* * * * *

Dated: January 27, 2005. 

Scott E. Thomas, 

Chairman, Federal Election Commission.

[FR Doc. 05–1892 Filed 2–1–05; 8:45 am] 

BILLING CODE 6715–01–P

FEDERAL ELECTION COMMISSION

11 CFR Part 300 

[Notice 2005–2] 

De Minimis Exemption for 

Disbursement of Levin Funds by State, 

District, and Local Party Committees

AGENCY: Federal Election Commission.

ACTION: Notice of Proposed Rulemaking.

SUMMARY: The Federal Election 

Commission requests comments on 

proposed revisions to the Commission’s 

regulations that establish a de minimis

exemption allowing State, district, and 

local committees of a political party to 

pay for certain Federal election activity 

aggregating $5,000 or less in a calendar 

year entirely with Levin funds. In Shays

v. FEC, the District Court held that the 

Commission’s de minimis exemption 

was inconsistent with the statutory 

intent of the Bipartisan Campaign 

Reform Act and remanded the 

regulation to the Commission for further 

action consistent with the court’s 

opinion. The Commission is appealing 

5386 Federal Register / Vol. 70, No. 21 / Wednesday, February 2, 2005 / Proposed Rules 

1 ‘‘Federal funds’’ are funds that comply with the 

limitations, prohibitions, and reporting 

requirements of the Act. See 11 CFR 300.2(g).

2The four types of FEA are: Type 1—Voter 

registration activity during the period that begins on 

the date that is 120 days before a regularly 

scheduled Federal election is held and ends on the 

date of the election; Type 2—Voter identification, 

get-out-the-vote activity, or generic campaign 

activity conducted in connection with an election 

in which a candidate for Federal office appears on 

the ballot; Type 3—A public communication that 

refers to a clearly identified candidate for Federal 

office; and Type 4—Services provided during any 

month by an employee of a State, district, or local 

committee of a political party who spends more 

than 25 percent of his or her compensated time 

during that month on activities in connection with 

a Federal election. See 2 U.S.C. 431(20) and 11 CFR 

100.24.

3Levin funds are a type of non-Federal funds 

raised only by State, district, and local political 

party committees. Levin funds are limited to 

donations of $10,000 per source per calendar year 

and are generally solicitable from sources otherwise 

prohibited by the Act (except from foreign 

nationals). Donations of Levin Funds, however, 

must be lawful under the laws of the State in which 

a committee is organized. See 2 U.S.C. 441i(b)(2)(B); 

see also 11 CFR 300.31 and 300.32(c). Types 1 and 

2 FEA listed in note 2, above, are allocable between 

Federal and Levin funds, so long as the activities 

do not refer to a clearly identified Federal candidate 

(‘‘allocable Type 1&2 FEA’’). See 2 U.S.C. 

441i(b)(2)(B)(i) and 11 CFR 300.32.

4 ‘‘Under the Chevron analysis, a court first asks 

‘‘whether Congress has directly spoken to the 

precise question at issue. If the intent of Congress 

is clear, that is the end of the matter; for the court, 

as well as the agency, must give effect to the 

unambiguously expressed intent of Congress.’’’’

Shays at 51 (quoting Chevron, U.S.A., Inc. v. 

Natural Res. Def. Council, 467 U.S. 837, 842–43 

(1984)).

this ruling to the D.C. Circuit. In the 

interim, the Commission is initiating 

this rulemaking. No final decision has 

been made by the Commission on the 

issues presented in this rulemaking. 

Further information is provided in the 

supplementary information that follows.

DATES: Comments must be received on 

or before March 4, 2005. If the 

Commission receives sufficient requests 

to testify, it may hold a hearing on these 

proposed rules. Commenters wishing to 

testify at the hearing must so indicate in 

their written or electronic comments.

ADDRESSES: All comments should be 

addressed to Mr. Brad C. Deutsch, 

Assistant General Counsel, and must be 

submitted in either electronic or written 

form. Commenters are strongly 

encouraged to submit comments 

electronically to ensure timely receipt 

and consideration. Electronic mail 

comments should be sent to 

deminimis@fec.gov and may also be 

submitted through the Federal 

eRegulations Portal at http://

www.regulations.gov. All electronic 

comments must include the full name, 

electronic mail address and postal 

service address of the commenter. 

Electronic mail comments that do not 

contain the full name, electronic mail 

address and postal service address of 

the commenter will not be considered. 

If the electronic mail comments include 

an attachment, the attachment must be 

in the Adobe Acrobat (.pdf) or Microsoft 

Word (.doc) format. Faxed comments 

should be sent to (202) 219–3923, with 

printed copy follow-up. Written 

comments and printed copies of faxed 

comments should be sent to the Federal 

Election Commission, 999 E Street, 

NW., Washington, DC 20463. The 

Commission will post public comments 

on its Web site. If the Commission 

decides a hearing is necessary, the 

hearing will be held in the 

Commission’s ninth floor meeting room, 

999 E Street NW., Washington, DC.

FOR FURTHER INFORMATION CONTACT: Mr. 

Brad C. Deutsch, Assistant General 

Counsel, or Ms. Cheryl A.F. Hemsley, 

Attorney, 999 E Street NW., 

Washington, DC 20463, (202) 694–1650 

or (800) 424–9530.

SUPPLEMENTARY INFORMATION: The 

Bipartisan Campaign Reform Act of 

2002 (‘‘BCRA’’), Pub. L. 107–155, 116 

Stat. 81 (March 27, 2002), contained 

extensive and detailed amendments to 

the Federal Election Campaign Act of 

1971, as amended (the ‘‘Act’’), 2 U.S.C. 

431 et seq. As amended by BCRA, 

subsection 441i(b)(1) of the Act, 2 U.S.C. 

441i(b)(1), provides that State, district, 

and local political party committees 

must generally use Federal funds 1 to 

pay for Federal election activity 

(‘‘FEA’’).2 However, subsection 

441i(b)(2) provides an exception for 

certain activities covered by Types 1 

and 2 FEA, for which State, district, and 

local political party committees may 

allocate disbursements between Federal 

funds and Levin funds in accordance 

with allocation ratios as determined by 

the Commission.3 2 U.S.C. 441i(b)(2); 

see also 11 CFR 300.2(i), 300.32, and 

300.33.

On July 29, 2002, the Commission 

promulgated regulations at 11 CFR Part 

300 implementing BCRA’s provisions 

concerning disbursements by State, 

district, and local party committees for 

FEA. See Final Rules and Explanation 

and Justification for Regulations on 

Prohibited and Excessive Contributions; 

Non-Federal Funds or Soft Money, 67 

FR 49064 (July 29, 2002) (‘‘Soft Money 

E&J’’). The regulations at 11 CFR 

300.32(c)(4) require any State, district, 

or local committee of a political party 

that disburses more than $5,000 on 

allocable Type 1&2 FEA in a calendar 

year either to pay for such allocable FEA 

entirely with Federal funds or to 

allocate disbursements between Federal 

funds and Levin funds. The 

Commission also created a de minimis

exemption for any State, district, or 

local party committee whose 

disbursements for allocable Type 1&2 

FEA aggregate $5,000 or less in a 

calendar year (the ‘‘$5,000 Exemption’’), 

permitting such committees to pay for 

these types of FEA entirely with Levin 

funds. 

In the Soft Money E&J, the 

Commission stated three reasons for 

promulgating the $5,000 Exemption at 

11 CFR 300.32(c)(4). First, the 

Commission noted that although BCRA 

requires State, district, and local 

political party committees to report all 

receipts and disbursements for FEA, the 

statute provides an exception for 

committees whose FEA receipts and 

disbursements aggregate less than 

$5,000 in a calendar year. See 2 U.S.C. 

434(e)(2)(A). The Commission reasoned 

that the reporting exception suggests 

that Congress did not take a rigid 

approach to low levels of FEA. Second, 

the Commission explained that it was 

particularly sensitive to the grassroots 

nature of allocable Type 1&2 FEA, 

stating that there is a far weaker nexus 

between Federal candidates and this 

category of FEA than the other types of 

FEA for which use of Levin funds is 

prohibited. Finally, the Commission 

noted that $5,000 is only half of what 

any single donor may donate to each 

and every State, district, and local 

political party committee under BCRA, 

so there is no danger that allowing a 

committee to use entirely Levin funds 

for allocable Type 1&2 FEA aggregating 

$5,000 or less in a calendar year would 

lead to circumvention of the $10,000 

Levin fund donation limit in BCRA. See

Soft Money E&J at 49097. 

In Shays v. FEC, 337 F.Supp.2d 28, 

114–117 (D.D.C. 2004), appeal filed, No. 

04–5352 (D.C. Cir. Sept. 28, 2004) 

(‘‘Shays’’), the district court held that 

the $5,000 Exemption in 11 CFR 

300.32(c)(4) was inconsistent with 

Congress’s clear intent, as expressed in 

BCRA, to allow State, district, and local 

party committees to pay for allocable 

Type 1&2 FEA either solely with 

Federal funds or with funds allocated 

between Federal and Levin funds.4 The 

court concluded that the $5,000 

Exemption was not permissible, finding 

that ‘‘Congress clearly expressed its 

intent in BCRA’s statutory language that 

all [FEA] pursued by state, local and 

district political party committees is to 

be paid for using federal funds, except 

for certain circumstances where such 

committees may use an ‘allocated’ ratio 

Federal Register / Vol. 70, No. 21 / Wednesday, February 2, 2005 / Proposed Rules 5387

5The Commission has filed an appeal with the 

U.S. Court of Appeals for the D.C. Circuit of certain 

aspects of the Shays decision, including the court’s 

conclusion that the $5,000 Exemption is 

inconsistent with the statutory intent of 2 U.S.C 

441i(b). The appeal is currently pending. In the 

event the Commission prevails on appeal, the 

Commission may terminate this rulemaking 

proceeding prior to adoption of final rules.

of federal and Levin funds.’’ Shays at 

116–17.

The court stated that for a regulatory 

de minimis exemption to stand, an 

agency has the burden of demonstrating 

that following the precise language of 

the statute would lead to ‘‘absurd or 

futile results,’’ or that the failure to 

create a de minimis exemption would be 

‘‘contrary to the primary legislative 

goal.’’ Shays at 117 (quoting 

Environmental Defense Fund v. EPA, 82 

F.3d 451, 466 (D.C. Cir. 1996) quoting, 

in turn, State of Ohio v. EPA, 997 F.2d 

1520, 1535 (D.C. Cir. 1993)). The court 

addressed each of the Commission’s 

reasons for adopting the $5,000 

Exemption and found that the 

Commission had not met the burden of 

demonstrating that following the precise 

statutory language would lead to absurd 

or futile results and had not shown that 

the $5,000 Exemption comported with 

BCRA’s purposes.5 Shays at 

117. The court then remanded the 

regulations to the Commission for 

further action consistent with its 

opinion. Shays at 130.

I. Proposed 11 CFR 300.32(c)(4)—

Conditions and Restrictions on 

Spending Levin Funds 

Because the court found the $5,000 

Exemption to be inconsistent with the 

statutory intent of 2 U.S.C 441i(b) and 

that the standards for upholding a de 

minimis exemption had not been met, 

the Commission proposes to delete the 

$5,000 Exemption from 11 CFR 

300.32(c)(4). Paragraph (c)(4) of the 

proposed rule would require State, 

local, and district political party 

committees to pay for all allocable FEA 

either entirely with Federal funds or 

with an allocation of Federal and Levin 

funds pursuant to 11 CFR 300.33. The 

Commission solicits comments on the 

proposed regulation. The Commission 

also invites comments on whether 

following the precise language of BCRA 

would lead to ‘‘absurd or futile results,’’

absent promulgation of a de minimis

exemption for disbursement of Levin 

funds by State, district, and local 

political party committees. 

II. Alternative Proposal for 11 CFR 

300.32(c)(4) 

Although not reflected in the attached 

proposed rules, the Commission also 

seeks comments on whether 11 CFR 

300.32(c)(4) should be revised to apply 

only to State, district, and local party 

committees with combined receipts and

disbursements for FEA (whether 

allocable or not) that together aggregate 

to less than $5,000 in a calendar year. 

See 2 U.S.C. 434(e)(2)(A). If a de 

minimis exemption allowing for the 

exclusive use of Levin funds for 

allocable Type 1&2 FEA were to apply 

only to State, district, and local party 

committees with FEA receipts and

disbursements aggregating less than 

$5,000 in a calendar year, the exemption 

would then apply only to those 

committees that are already statutorily 

exempt from having to report FEA 

under the exception contained in 2 

U.S.C. 434(e)(2)(A). The Commission 

invites comment on whether adoption 

of this alternative proposal would 

comport with the statutory intent of 2 

U.S.C 441i(b). 

Certification of No Effect Pursuant to 5 

U.S.C. 605(b) [Regulatory Flexibility 

Act] 

The Commission certifies that the 

attached proposed rules, if promulgated, 

would not have a significant economic 

impact on a substantial number of small 

entities. The basis for this certification 

is that the State, district, and local party 

committees of the two major political 

parties are not small entities under 5 

U.S.C. 601 because they are not small 

businesses, small organizations, or small 

governmental jurisdictions. To the 

extent that other political party 

committees may fall within the 

definition of ‘‘small entities,’’ their 

number is not substantial.

List of Subjects in 11 CFR Part 300 

Campaign funds, Nonprofit 

organizations, Political candidates, 

Political committees and parties, 

Reporting and recordkeeping 

requirements.

For the reasons set out in the 

preamble, the Federal Election 

Commission proposes to amend 

subchapter C of chapter I of title 11 of 

the Code of Federal Regulations as 

follows:

PART 300—NON-FEDERAL FUNDS 

1. The authority citation for part 300 

would continue to read as follows:

Authority: 2 U.S.C. 434(e), 438(a)(8), 

441a(a), 441i, 453.

2. Section 300.32 would be amended 

by revising paragraph (c)(4) to read as 

follows:

§ 300.32 Expenditures and disbursements

* * * * *

(c) * * * 

(4) The disbursements for allocable 

Federal election activity may be paid for 

entirely with Federal funds or may be 

allocated between Federal funds and 

Levin funds according to 11 CFR 300.33.

* * * * *

Dated: January 27, 2005. 

Scott E. Thomas, 

Chairman, Federal Election Commission.

[FR Doc. 05–1891 Filed 2–1–05; 8:45 am] 

BILLING CODE 6715–01–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. FAA–2005–20251; Directorate 

Identifier 2004–NM–164–AD] 

RIN 2120–AA64 

Airworthiness Directives; Raytheon 

Model Hawker 800XP Airplanes

AGENCY: Federal Aviation 

Administration (FAA), Department of 

Transportation (DOT).

ACTION: Notice of proposed rulemaking 

(NPRM). 

SUMMARY: The FAA proposes to adopt a 

new airworthiness directive (AD) for 

certain Raytheon Model Hawker 800XP 

airplanes. This proposed AD would 

require inspecting to detect damage of 

certain wiring in the flight 

compartment, performing corrective 

actions if necessary, modifying certain 

wiring connections, and revising the 

airplane flight manual. This proposed 

AD is prompted by reports of miswiring 

in the power distribution system. We 

are proposing this AD to ensure that the 

flightcrew is aware of the source of 

battery power for certain equipment, 

and to prevent damage to wiring and 

surrounding equipment that could 

result in smoke or fire on the airplane.

DATES: We must receive comments on 

this proposed AD by March 21, 2005.

ADDRESSES: Use one of the following 

addresses to submit comments on this 

proposed AD. 

• DOT Docket Web site: Go to

http://dms.dot.gov and follow the 

instructions for sending your comments 

electronically. 

• Government-wide rulemaking Web 

site: Go to http://www.regulations.gov

and follow the instructions for sending 

your comments electronically. 

• Mail: Docket Management Facility, 

U.S. Department of Transportation, 400 

Seventh Street SW., Nassif Building, 

Room PL–401, Washington, DC 20590. 

• By fax: (202) 493–2251.