Federal Election Commission Campaign Guide Congressional Candidates and Committees August 2011 This publication provides guidance on certain aspects of federal campaign finance law. This publication is not intended to replace the law or to change its meaning, nor does this publication create or confer any rights for or on any person or bind the Federal Election Commission (Commission) or the public. The reader is encouraged also to consult the Federal Election Campaign Act of 1971, as amended (2 U.S.C. 431 et seq.), Commission regulations (Title 11 of the Code of Federal Regulations), Commission advisory opinions, and applicable court decisions. For further information, please contact: Federal Election Commission 999 E Street, N.W. Washington, DC 20463 (800) 424-9530 (202) 694-1100 firstname.lastname@example.org www.fec.gov Congressional Candidates and Committees August 2011 Editor’s Note: In January 2010, the Supreme Court announced its decision in Citizens United v. FEC. In response to the Court’s decision, the Commission announced it would no longer enforce the statutory provisions or regulations prohibiting corporations and labor organizations from making independent expenditures and electioneering communications. Corporations and unions engaged in those activities should comply with the disclaimer and reporting requirements, since the Court upheld those provisions. The Commission said it would address other regulations that may have been affected by the Court’s decision in a forthcoming rulemaking. Rules affected by the Court’s decision include: • 11CFR114.2(b)(2) and (3), which implement the Federal Election Campaign Act’s prohibition on corporate and labor organization independent expenditures and electioneering communications; • 11 CFR 114.4, which restricts the types of communications corporations and labor organizations may make to those not within their restricted class; • 11 CFR 114.10, which permits certain qualified nonprofit corporations to use their treasury funds to make independent expenditures and electioneering communications under certain conditions; • 11 CFR 114.14, which places restrictions on the use of corporate and labor union funds for electioneering communications; and • 11 CFR 114.15, which the Commission adopted to implement the Supreme Court’s decision in Wisconsin Right to Life, Inc. v. FEC. This publication reflects the guidance provided in the Commission’s public statement, which is available on the FEC website at http://www.fec.gov/press/press2010/20100205CitizensUnited.shtml. Introduction This Guide was written to help U.S. House and Senate Candidates comply with the Federal Election Campaign Act and FEC regulations. It may be used by committees supporting Presidential candidates who About this Guide are not seeking public funding. However, special reporting rules apply to Presidential candidates, as This Campaign Guide for Congressional Candidates explained in footnotes to the reporting chapters. and Committees replaces the April 2008 edition. It summarizes the federal campaign finance laws appli- This publication provides guidance on certain cable to candidate committees as of August 2011. aspects of federal campaign finance law. It is not intended to replace the law or to change its mean- ing, nor does this publication create or confer any rights for or on any person or bind the Federal Election Commission (Commission) or the public. Federal Election Commission The reader is encouraged also to consult the Washington, DC 20463 Federal Election Campaign Act of 1971, as amended (2 U.S.C. 431 et seq.), Commission regulations Commissioners: (Title 11 of the Code of Federal Regulations), Cynthia L. Bauerly, Chair Commission advisory opinions and applicable court Caroline C. Hunter, Vice Chair decisions. For further information, please contact: Donald F. McGahn II Federal Election Commission Matthew S. Petersen 999 E Street NW Steven T. Walther Washington, DC 20463 Ellen L. Weintraub • 800/424-9530 (toll free) Staff Director: • 202/694-1100 (local) Alec Palmer • 202/219-3336 (for the hearing impaired) Acting General Counsel: • email@example.com Christopher Hughey • www.fec.gov Using This Guide Prepared by the Information Division Citations of the Office of Communications Authorities primarily cited in this Guide include Director: the Federal Election Campaign Act, FEC regulations Greg J. Scott and FEC Advisory Opinions (AOs). All regula- tory citations are to Title 11 of the Code of Deputy Director: Federal Regulations (CFR), Parts 100–116, 300, Amy L. Kort 400 and 9001–9039 (2011). Statutory citations are to Titles 2 and 26 of the United States Code Layout and Design: (U.S.C.). Copies of AOs may be obtained from James Landon Jones the FEC’s Public Records Office (800/424-9530 or 202/694-1120), the FEC website (http://saos. iii nictusa.com/saos/searchao) or by calling the FEC’s Faxline automated Faxline, (202/501-3413); in addition, The FEC maintains a free automated fax-on- each AO is summarized in the Commission’s demand service, Faxline. Documents available on newsletter, the Record. AOs are also reported Faxline include selected parts of Title 2 of the in the Federal Election Campaign Financing Guide, U.S. Code, FEC regulations, Advisory Opinions published by Commerce Clearing House, Inc. (1990-present), forms and schedules, brochures and other documents regarding campaign finance. Getting More Help To receive documents from the Faxline, call 202/501-3413 and follow the voice prompts. Advisory Opinions Any person or group requiring a clarification of World Wide Web the election law with regard to an activity that Visit the FEC’s home page on the World Wide they plan to undertake may request an advisory Web at http://www.fec.gov. Information on the opinion from the FEC. Individuals and organiza- site includes campaign finance statistical data; tions involved in the activity specifically addressed committee reports for candidates, parties and in an AO (or in an activity that is materially PACs; FEC news releases; reporting dates; forms; indistinguishable) may rely on the opinion for the newsletter; brochures and Campaign Guides. legal guidance. Advisory opinion requests may be The FEC website also offers the capability to addressed to the Office of General Counsel at: search the Commission’s campaign finance database Federal Election Commission online. The website also offers full text searches of 999 E Street, NW Commission Advisory Opinions (AOs) issued since Washington, DC 20463 1977. Searches can be made using the name of a Toll-Free Line requestor or other information about AOs. In addi- tion, the FEC’s Enforcement Query System allows Many questions about federal campaign finance users to search closed enforcement cases by such law do not require formal advisory opinions. search criteria as respondent name or case number. Such questions may be addressed to trained FEC staff members by calling the FEC’s 800 Compliance with Small Business Regulatory number, below. Persons in the Washington, Enforcement Fairness Act of 1996 DC, area may call locally. The numbers are: This Guide serves as the small entity compliance • 800/424-9530 guide for Congressional candidates and com- • 202/694-1100 mittees, as required by section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996, • 202/219-3336 (for the hearing impaired) Pub. L. No. 104-121, Title II, Stat. 857 (1996). • Hearing-impaired persons may reverse the charges when calling long distance. Free Publications In addition to this Guide, the FEC publishes a series of brochures and other publications on several aspects of campaign financing and election law. E-mail or call the FEC for a list of publications currently available, or visit the FEC website. Please note that Congressional campaign com- mittees have to comply with other laws outside the FEC’s jurisdiction; see Appendix G. iv Contents LIST OF TABLES AND EXAMPLES vii 2. Brokerage Loans and Other Lines of Credit Obtained by Candidate 36 ChAPTEr 1 Testing the Waters 1 3. Overdrafts 36 1. Testing the Waters vs. Campaigning 1 4. Investment Income 36 2. Contribution Limits and Prohibitions 2 5. Offsets to Operating Expenditures 37 3. Recordkeeping and Accounting 2 6. Legal and Accounting Services 37 4. Example 2 5. Organizing a Testing-the-Waters Committee 3 ChAPTEr 7 Sources of Support 39 1. Contributions 39 ChAPTEr 2 Starting the Campaign 5 2. Free Legal and Accounting Services 39 1. Candidate Registration Threshold 5 3. Volunteer Activity 39 2. Candidate and Committee Registration 5 4. Travel Cost Exemptions 41 3. Statement of Candidacy 6 5. Vendor Discounts on Food and Beverages 42 4. Treasurer 7 6. Support from Other Campaigns 42 5. Statement of Organization 9 7. Party Support 43 8. Corporate/Labor Exceptions 45 ChAPTEr 3 Understanding Contributions 13 9. Use of Corporate/Labor Facilities and 1. What Is a Contribution 13 Resources 48 2. Types of Contributions 13 10. Fundraisers for Candidates 49 11. Independent Expenditures 50 ChAPTEr 4 Contribution Limits 17 12. Electioneering Communications 50 1. Overview of Limits 17 2. How Limits Work 20 ChAPTEr 8 Expenditures and Other Uses of 3. Contributions to Unauthorized Committees 22 Campaign Funds 51 4. Designated and Undesignated Contributions 22 1. Permissible Uses of Campaign Funds 51 5. Date Contribution Is Made vs. Date of Receipt 23 2. Prohibited Uses of Campaign Funds 53 6. Joint Contributions 24 7. Remedying an Excessive Contribution 24 ChAPTEr 9 Transfers 59 8. Contributions to Retire Debts 27 1. Transfers Between Candidate’s Committees 9. Contributions from Partnerships 28 or Same Office 59 10. Contributions from Limited Liability Companies 28 2. Transfers Between Committees of Candidate Seeking More Than One Office 59 11. Contributions from Minors 29 3. Transfers from Candidate’s Nonfederal 12. Candidate’s Personal Funds 29 Committee Are Prohibited 61 13. Repayment of Personal Loans from Candidate 30 4. Transfers of Joint Fundraising Receipts 61 ChAPTEr 5 Prohibited Contributions 31 5. What is NOT a Transfer 61 1. Prohibited Sources 31 ChAPTEr 10 Conducting the Campaign 63 2. Questionable Contributions 33 1. Fundraising 63 ChAPTEr 6 Other reportable receipts 35 2. Disclaimers 65 1. Bank Loans 35 (Cont.) v 3. Rates for Political Advertisements 67 19. Reporting Refunds, Returns and 4. Campaign Travel 67 Bounced Checks 107 20. Reporting Transfers Between Authorized ChAPTEr 11 Keeping records 73 Committees 108 1. Record Retention 73 21. Reporting Investments 109 2. Recording Receipts 73 22. Completing the Report 110 3. Recording Disbursements 75 23. The Detailed Summary Page 110 4. Recording Debts and Loans 76 24. Post-Election Detailed Summary Page 114 5. Treasurer’s Best Efforts 76 25. The Summary Page 114 26. Filing Amendments 116 ChAPTEr 12 Filing reports 79 1. Who Reports 79 ChAPTEr 14 Winding Down the Campaign 117 2. Where to File Reports 80 1. Terminating the Committee 117 3. When to Report 80 2. Conversion to Multicandidate Committee 117 4. Administrative Fines for Late Filers 3. Winding Down Costs 118 and Nonfilers 82 4. Sale of Campaign Assets 118 5. Electronic Filing 83 5. Retiring Debts 119 6. Public Inspection of Reports 86 6. Settling Debts 119 ChAPTEr 13 Completing FEC reports 87 APPENDIX A Earmarked Contributions 123 1. Reporting Forms and Formats 87 2. Special Rules for First Report 88 APPENDIX B Contributions from 3. Categorizing Receipts 88 Partnerships 127 4. How to Itemize Receipts 89 APPENDIX C Joint Fundraising 131 5. When to Itemize Receipts 89 6. Reporting Contributions, Loans and APPENDIX D Communications 139 Advances from Candidate 91 7. Reporting Joint Contributions 92 APPENDIX E. Fundraising by Federal Candidates and Officeholders 151 8. Reporting Redesignations and Reattributions 92 9. Reporting Free Legal and Accounting Services 93 APPENDIX F. Lobbyist Bundled 10. Reporting In-Kind Contributions 94 Contributions 155 11. Reporting Reimbursed Advances of Personal Funds (Non-Travel) 95 APPENDIX G. Compliance with Other Laws 163 12. Reporting Travel Expenses 97 APPENDIX h. Definitions 165 13. Categorizing Disbursements 98 14. How to Itemize Disbursements 99 INDEX 173 15. When to Itemize Disbursements 100 16. Reporting Debts Other Than Loans 101 17. Reporting Loans 103 18. Reporting Bank Loans, Brokerage Loans and Other Lines of Credit When Made to Candidates 105 vi List of Examples and Tables ChAPTEr 2 Candidate Registration 7 Committee Registration 8 Committee Registration (Page 2) 10 Committee Registration (Page 3) 10 Committee Registration (Page 4) 11 ChAPTEr 4 Contribution Limits For 2011 – 12 18 ChAPTEr 12 Reporting Deadlines 83 ChAPTEr 13 Contributions From Other Political Committee And Organizations 89 Aggregation Of Contributions 90 Contributions From Candidate’s Personal Funds 91 Joint Contributions 92 Redesignations 93 Reattributions 94 Free Legal And Accounting Services 94 In-Kind Contribution (Schedule A) 95 In-Kind Contribution (Schedule B) 95 Appreciated Goods As Contributions 96 Sale Of Appreciated Goods As Contributions 96 Nontravel Reimbursements 97 Nontravel Staff Advances Made And Reimbursed In Different Reporting Periods 97 Operating Expenditures 99 Contributions To Other Federal Candidates 100 Credit Card Transactions (Schedule B) 101 Credit Card Transactions (Schedule D) 101 Debts Owed By The Committee (Schedule B) 102 Debts Owed By The Committee (Schedule D) 102 Bank Loans Endorsed By Candidate 103 Loan Payment 104 Loans From Candidate’s Personal Funds (Schedule A) 104 Loans From Candidate’s Personal Funds (Schedule C) 104 Candidate Home Equity Line Of Credit (Schedule A) 105 (Cont.) vii Candidate Home Equity Line Of Credit Principal Payment 105 Candidate Home Equity Line Of Credit Interest Payment 105 Candidate Home Equity Line Of Credit (Schedule C) 106 Candidate Home Equity Line Of Credit (Schedule C-1) 107 Refunded Contributions (Schedule A) 108 Refunded Contributions (Schedule B) 108 Checks Returned Due To Insufficient Funds 108 Transfers Between Candidate’s Committees, Same Office 109 Detailed Summary Page 111 Detailed Summary Page (Continued) 112 Post Election Detailed Summary Page 114 Summary Page 115 Summary Page (Continued) 116 APPENDIX A Earmarked Contribution 126 APPENDIX B Partnership Contributions 129 APPENDIX C Form 1 Filed By Joint Fundraising Representative 133 Form 1 Filed By PCC Showing Affiliation 133 Joint Fundraising (Schedule A) 136 APPENDIX F Reporting Bundled Contributions 157 Reporting Bundled Contributions (Schedule A) 158 Form 3L Covered Periods And Filing Deadlines 159 viii ChAPTEr 1 Testing the Waters Before deciding to campaign for federal office, an individual may first want to “test the waters”—that 1. Testing the Waters is, explore the feasibility of becoming a candidate. vs. Campaigning For example, the individual may want to travel around the state or district to see if there is suf- ficient support for his candidacy. An individual Testing the Waters who merely conducts selected testing the waters activities that fall within the exemptions in FEC An individual may conduct a variety of activi- regulations that are discussed in Section 1 below ties to test the waters. Examples of permissible (but does not campaign for office) does not have testing-the-waters activities include polling, to register or report as a candidate even if the travel and telephone calls undertaken to deter- individual raises or spends more than $5,000 mine whether the individual should become on those activities (i.e., the dollar threshold that a candidate. 100.72(a) and 100.131(a). would normally trigger candidate registration (which is discussed in Chapter 2)). Nevertheless, Campaigning the individual must comply with the contribution Certain activities, however, indicate that the limits and prohibitions. 100.72(a) and 100.131(a); individual has decided to become a candidate see also Advisory Opinion (AO) 1985-40. and is no longer testing the waters. In that case, Once an individual begins to campaign or decides once the individual has raised or spent more than to become a candidate, funds that were raised $5,000, he or she must register as a candidate. or spent to test the waters apply to the $5,000 Note that, when an individual decides to run threshold for qualifying as a candidate. 100.72(a) for office, funds that were raised and spent to and 100.131(a). Once that threshold is exceeded, test the waters apply to the $5,000 threshold. the individual must register with the FEC (candi- Campaigning (as opposed to testing the waters) dates for the House of Representatives)1 or the is apparent, for example, when individuals: Secretary of the Senate (candidates for the Senate), and begin to file reports (including in the first • Make or authorize statements that refer report all activity that occurred prior to reaching to themselves as candidates (“Smith the $5,000 threshold), as discussed in Chapter 2. in 2012” or “Smith for Senate”); • Use general public political advertising to publicize their intention to campaign; • Raise more money than what is rea- sonably needed to test the waters or amass funds (seed money) to be used after candidacy is established; • Conduct activities over a protracted period of time or shortly before the election; or • Take action to qualify for the ballot. 100.72(b) and 100.131(b). 1 The same guidance for “testing the waters” applies to individuals testing the waters for a Presidential candidacy. Once the threshold is exceeded, such individuals must register their candidacy with the FEC. 1 Chapter 1 Also, once an individual files FEC Form 2, State- • Foreign nationals; or ment of Candidacy, he or she is no longer • Federal government contractors. considered to be “testing the waters” and must file FEC Form 1 (and subsequently file financial See Chapter 5 for more informa- reports) under the rules described in Chapter tion on contribution prohibitions. 2, “Starting the Campaign.” AO 1979-51. 3. recordkeeping and 2. Contribution Limits Accounting and Prohibitions Funds raised to test the waters are subject to the Recordkeeping Act’s contribution limits. Moreover, the individual An individual who tests the waters must keep who is testing the waters may not accept funds financial records. If he or she later becomes a from prohibited sources. 100.72(a) and 100.131(a). candidate, the money raised and spent to test the waters must be reported by the campaign as Limits contributions and expenditures. 101.3. See Chapter 11 for more information on recordkeeping. Keep in mind that contribution limits apply to all the support given to an individual who is testing the waters, even donations from a family member Separate Bank Account or friend. (See the chart on contribution limits Another consideration, though not a require- in Chapter 4.) The limits apply, for example, to: ment, is the segregation of testing-the-waters • Gifts of money, goods and services; funds from personal funds. It is advisable for the individual to set up a separate bank account for the • Loans (except bank loans); deposit of receipts and the payment of expenses. • Certain staff advances until repaid (see Chap- If the individual later becomes a candidate, a ter 3 for more information on staff advances); campaign account must be established to keep • Endorsements and guaran- the campaign funds separate from the individual’s tees of bank loans; and personal funds. 102.10, 102.15, 103.2 and 103.3(a). • Funds given or personally loaned to the individual to pay for his or her living expenses during the testing-the-waters 4. Example period (AO 1978-40). 100.52(a). Mr. Jones is interested in running for a seat in See Chapter 4 for more informa- the U.S. House of Representatives but is unsure tion on contribution limits. whether he has enough support within his district to make a successful bid. He therefore accepts Prohibitions up to $2,500 from each of several relatives and In observing the law’s prohibitions, the indi- friends and uses the money to pay for an opinion vidual may not accept money from: poll. He sees that good records are kept on the money raised and spent in his testing-the-waters • Labor organizations (although funds from effort. The poll results indicate good name recogni- a labor separate segregated fund—also tion in the community, and Jones decides to run. called a PAC—are permissible); By making this decision, Jones has crossed the • Corporations, including nonprofit cor- line from testing the waters to campaigning. The porations (although funds from a cor- funds he raised earlier now automatically become porate separate segregated fund—also contributions and the funds he spent, including called a PAC—are permissible); 2 Testing the Waters the polling costs, are now expenditures. These contributions and expenditures count toward the threshold that triggers candidate status. Once his contributions or expenditures exceed $5,000, he becomes a candidate and must register under the Act. The money raised and spent for testing the waters must be disclosed on the first report his principal campaign committee files. Had Jones decided not to run for federal office, there would have been no obligation to report the monies received and spent for testing-the-waters activity, and the donations made to help pay for the poll would not have counted as contributions. 5. Organizing a Testing-the- Waters Committee An individual may organize a “committee” for test- ing the waters. An “exploratory committee” or “testing-the-waters committee” is not considered a political committee and does not have to register or file reports as long as its activities are limited to testing the waters and it does not engage in campaigning. The name of the committee, and state- ments by committee staff, must not refer to the individual as a candidate. For example, an explor- atory committee could not be called “Sam Jones for Congress,” which would indicate that Jones had already decided to run for federal office. Instead, the committee could be called “Sam Jones Congres- sional Exploratory Committee.” See AO 1981-32. If the potential candidate decides to run for federal office and becomes a candidate under the Act, then he or she may designate the exploratory com- mittee as the principal campaign committee and change the name of the committee as appropriate. 3 ChAPTEr 2 Starting the Campaign 1. Candidate registration Candidate Threshold Within 15 days after an individual becomes a can- didate as described in Section 1 above, he or she An individual triggers registration and reporting must designate a principal campaign committee. responsibilities under the Act when campaign This designation is made by filing either a State- activity exceeds $5,000 in either contributions ment of Candidacy (FEC Form 2) or a letter with or expenditures. (Money raised and spent to test the same information. (A candidate required to file electronically cannot designate a principal campaign the waters does not count toward this dollar committee with a written letter but must instead threshold until the individual decides to run for file Form 2. See below.) 101.1(a) and 102.12(a). federal office or conducts activities that indicate he or she is actively campaigning rather than Senate candidates file their original Form 2 with the Secretary of the Senate. House can- testing the waters. (See Chapter 1, “Testing the didates file their Form 2 with the FEC.1 Waters.”) The $5,000 threshold is reached when: • The individual and/or persons he or she Principal Campaign Committee has authorized to conduct campaign activ- Within 10 days after it has been designated by ity receive over $5,000 in contributions or the candidate, the principal campaign committee make over $5,000 in expenditures; or must register by filing (with the Commission or • The individual fails to disavow unauthorized Secretary of the Senate, as appropriate) a State- campaign activity by writing a letter to the ment of Organization (FEC Form 1). 102.1(a).2 FEC within 30 days after being notified by the agency that another person or group has Where to File Reports received contributions or made expenditures Principal campaign committees of House and of more than $5,000 on the individual’s Presidential candidates must mail in their original behalf. 100.3(a)(3) and 102.13(a)(2). Forms 1 and 2 to the Federal Election Commission, 999 E Street, NW, Washington, DC 20463. 105.1. Principal campaign committees of Senate candi- 2. Candidate and Committee dates must mail in their original Forms 1 and 2 registration to the Secretary of the Senate, Office of Public Records, P.O. Box 2517, Alexandria,VA 22301. 105.2. The registration forms mentioned in this section When filing a document with the Secretary of the (FEC Forms 1 and 2) are available from the FEC, on Senate, it is not necessary to send a copy to the the Commission website, by fax and as part of the FEC. The Secretary automatically makes copies of agency’s FECFile software. Samples of completed all filings and forwards them to the FEC for review. forms appear throughout this chapter. Federal 1 Candidates running in Guam, Northern Mariana candidates and their committees should also Islands or Puerto Rico must also file a copy contact the government offices and agencies listed of their Form 2 in their territory. 108.1. in Appendix G for additional reporting require- 2 A copy must also be filed with the appropriate office in Guam, Northern Mariana Islands or Puerto Rico for ments that are not within the FEC’s jurisdiction. candidates running for office in those territories. 108.1. 5 Chapter 2 Electronic Filing If the candidate designates a new principal Under FEC regulations, the Statement of campaign committee, the committee must Organization (FEC Form 1) and Statement of file a new Statement of Organization (FEC Candidacy (Form 2) must be filed electroni- Form 1) within 10 days after being designated. cally if the campaign raises or spends more than 102.1(a). The newly designated committee will $50,000 in any calendar year, or has reason to receive a new FEC identification number. expect to do so. 104.18(a). The electronic fil- ing requirement does not apply to political Other Authorized Committees committees that are required to file with the In addition to the principal campaign com- Secretary of the Senate. For more information mittee, the candidate may designate other on electronic filing, see Chapter 12, Section 5. authorized committees to receive contribu- Committees required to file electronically tions or make expenditures on his or her under section 104.18 as described above must behalf. The following steps must be taken: also include their e-mail address on their Statement of Organization. 102.2(a)(1)(vii). Action by Candidate The candidate designates the authorized com- Candidates Must Register mittee by filing a statement (either FEC Form 2 or a letter) with the principal campaign for Each Election Cycle committee. 101.1(b) and 102.13(a)(1). Candidate Action by Authorized Committee A candidate (including an incumbent) must file Within 10 days after being designated by a new FEC Form 2 for each election cycle in the candidate, the authorized committee which he is a candidate. For example, Mr. Jones, must file a registration statement (FEC Form who was a candidate for the U.S. House of Rep- 1) with the candidate’s principal campaign resentatives in 2010, wishes to run again in 2012. committee. 102.1(b) and 102.13(a)(1). He must file a new FEC Form 2 within 15 days after crossing the $5,000 registration threshold Action by Principal Campaign Committee (see Section 1) for the 2012 election cycle. The principal campaign committee, in turn, files the documents with the appropriate fed- Principal Campaign Committee eral and state offices, as explained above. Using Form 2, the candidate may either redesignate his previous campaign committee (if it has not been terminated) or designate 3. Statement of Candidacy a new principal campaign committee. If the candidate redesignates an existing commit- tee, the committee need only amend its Statement Line-by-Line Instructions of Organization (FEC Form 1) within 10 days Line 1. Name and Address of the Committee to reflect any new information (e.g., a change in the committee’s name or address). 102.2(a) Enter the name and mailing address of the candidate. (2). The redesignated committee will retain its Line 2. Candidate’s FEC Identification Number original FEC identification number. Redesignated committees are reminded that, if outstanding A candidate who has never run before, is run- debts remain from the previous election, the ning in a different district or is seeking a different committee must continue to report the debts federal office should leave this line blank. When as well as the contributions that have been des- his or her Statement has been received, he or ignated by contributors to retire them. 104.11, she will be assigned an identification number. 110.1(b)(3) and (4) and 110.2(b)(3) and (4). Candidates who are seeking reelection, and candi- 6 Starting the Campaign of the principal campaign commit- CANDIDATE REGISTRATION tee must include the name of the candidate. On Line 7, the candidate FEC FORM 2 must indicate the year of the elec- STATEMENT OF CANDIDACY tion and the full name and street 1. (a) Name of Candidate (in full) Jane Doe address of the candidate’s principal (b) Address (number and street) 626 Street Dr. Check if address changed 2. Candidate’s FEC Identification Number campaign committee. 101.1(a) (c) City, State, and ZIP Code 3. Is This New Amended Springfield, VA 00000 Statement X (N) OR (A) 4. Par ty Affiliation 5. Office Sought 6. State & District of Candidate Line 8. Other Authorized Committees IND US House VA 12 DESIGNATION OF PRINCIPAL CAMPAIGN COMMITTEE A candidate may designate addi- 7. I hereby designate the following named political committee as my Principal Campaign Committee for the 2012 election(s). tional political committees to accept (year of election) NOTE: This designation should be filed with the appropriate office listed in the instructions. (a) Name of Committee (in full) contributions or make expenditures Doe for Congress on behalf of the candidate—this (b) Address (number and street) 319 Main St. includes joint fundraising represen- (c) City, State, and ZIP Code tatives. The name of any committee Springfield, VA 00000 authorized by the candidate must DESIGNATION OF OTHER AUTHORIZED COMMITTEES include the name of the candidate. (Including Joint Fundraising Representatives) 8. I hereby authorize the following named committee, which is NOT my principal campaign committee, to receive and expend funds on behalf of my For Line 8, the candidate must fill in candidacy. NOTE: This designation should be filed with the principal campaign committee. the name and street address of any (a) Name of Committee (in full) authorized committee(s). 101.1(b). Friends of Jane Doe (b) Address (number and street) The candidate must sign and date 229 Hidden View Ln. the Statement of Candidacy. (c) City, State, and ZIP Code Springfield, VA 00000 I certify that I have examined this Statement and to the best of my knowledge and belief it is true, correct and complete. Jane Doe Signature of Candidate Date 11/11/2011 . 4. Treasurer NOTE: Submission of false, erroneous, or incomplete information may subject the person signing this Statement to penalties of 2 U.S.C. §437g. Treasurer Required FEC FORM 2 (REV. 02/2009) The committee must have a treasurer before it accepts dates who have terminated a previous candidacy contributions or makes expen- but are now running again for the same seat, ditures. 102.7(a) and (b). Also, only a treasurer should use their original identification number. or designated assistant treasurer may sign FEC reports and statements (see “Vacancy Line 3. Is This Statement New or Amended? in Office,” below). 102.2(a) and 104.14(a). Check “New” if you are filing Form 2 for The candidate may act as the treasurer. the first time for this particular office this cycle. Otherwise, check “Amended.” Treasurer’s Duties Line 4-6. Party Affiliation, Office Sought, The treasurer (or designated assis- State & District of Candidate tant treasurer) is responsible for: Provide the requested information. • Filing complete and accurate reports and statements on time. 104.14(d). Line 7. Principal Campaign Committee • Signing all reports and state- Each candidate for federal office (other than a ments. 102.2(a) and 104.14(a). nominee for the office of Vice President) must des- ignate in writing a political committee to serve as • Depositing receipts in the committee’s desig- his or her principal campaign committee. The name nated bank within 10 days of receipt. 103.3(a). 7 Chapter 2 • Authorizing expenditures or appointing an agent (either COMMITTEE REGISTRATION orally or in writing) to autho- rize expenditures. 102.7(c). STATEMENT OF FEC FORM 1 ORGANIZATION • Monitoring contributions Office Use Only to ensure compliance with 1. NAME OF (Check if name Example:If typing, type COMMITTEE (in full) is changed) over the lines. 12FE4M5 the law’s limits and prohibi- tions. 103.3(b); 110.1(k)(3). Doe for Congress • Keeping the required records 319 Main St. ADDRESS (number and street) of receipts and disbursements (Check if address for three years from the date is changed) Springfield VA 00000 of the report to which they Y T I C E T A T S E D O C P I Z relate. 102.9(c) and 104.14(b). COMMITTEE'S E-MAIL ADDRESS (Please provide only one e-mail address) firstname.lastname@example.org (Check if address Treasurer’s Liability is changed) A committee’s treasurer is person- COMMITTEE'S WEB PAGE ADDRESS (URL) www.doeforcongress.com ally responsible for carrying out the (Check if address is changed) duties listed above and should under- stand these responsibilities (as well 2. DATE M 11 M / D 11 D / Y Y 2011 Y Y as his or her personal liability for C fulfilling them) before taking them on. 3. FEC IDENTIFICATION NUMBER When the Commission brings 4. IS THIS STATEMENT X NEW (N) OR AMENDED (A) an enforcement action against a I certify that I have examined this Statement and to the best of my knowledge and belief it is true, correct and complete. political committee, the treasurer Gottlob Frege Gottlob Frege Type or Print Name of Treasurer is usually named as a respondent M M / D D / Y Y Y Y Signature of Treasurer Date 11 11 2011 along with the committee itself. The treasurer can be named and NOTE: Submission of false, erroneous, or incomplete information may subject the person signing this Statement to the penalties of 2 U.S.C. §437g. ANY CHANGE IN INFORMATION SHOULD BE REPORTED WITHIN 10 DAYS. found liable in his or her official Office FEC FORM 1 For further information contact: capacity as a representative of the Use Only Federal Election Commission Toll Free 800-424-9530 Local 202-694-1100 (Revised 02/2009) committee. Also, the treasurer can be named and found liable in his or her personal capacity if he mittee to name, on its Statement of Organization or she knowingly and willfully violates the Act under “Designated Agent,” an assistant treasurer or intentionally deprives himself or herself of who may assume the treasurer’s duties when the the operative facts giving rise to the violation. treasurer’s office becomes temporarily vacant or Even when an enforcement action alleges viola- when the treasurer is unavailable. 102.7(a) and tions that occurred during the term of a previ- (b). The assistant treasurer should be apprised of ous treasurer, the Commission usually names any filing requirements and, if the committee files the current treasurer as a respondent in the electronically, should obtain an electronic filing action. See the “Statement of Policy Regarding password as well. The committee must report Treasurers Subject to Enforcement Proceed- any change in the treasurer’s status within 10 ings,” 70 Fed. Reg. 3 (January 3, 2005). days by filing an amendment to the Statement of Organization (FEC Form 1). 102.2(a)(2). See the next section for information on that form. Vacancy in Office Committees typically disclose a treasurer’s resig- A committee cannot raise or spend funds when nation by naming a replacement. The committee there is a vacancy in the office of treasurer. For informs the FEC of a change in treasurer by filing that reason, the Commission urges every com- 8 Starting the Campaign an amended FEC Form 1, which is signed by the required to file electronically must disclose their new treasurer. However, in some circumstances e-mail addresses. 102.2(a)(1)(vii). The Commis- a treasurer simply resigns without the appoint- sion recommends that all filers disclose an e-mail ment of a replacement by submitting a letter address, since the Commission sends courtesy of resignation to the FEC. (Electronic filers use reporting reminders and other helpful informa- Form 99.) The letter’s stated purpose is to amend tion to the e-mail address listed on Form 1. the committee’s Statement of Organization to reflect the resignation of the treasurer as of a Line 2. Date particular date. Because a committee cannot raise Enter the date when the committee or spend funds without a treasurer, from that officially became a political commit- date forward the Commission deems the com- tee—that is, the date when the committee mittee dormant until a new treasurer is named. exceeded the registration threshold. Line 3. FEC Identification Number 5. Statement of Organization The Federal Election Commission assigns each committee an identification number after the com- When registering, a committee must include mittee has filed a registration statement. (This num- basic information on the Statement of Orga- ber is used by the FEC for computer indexing and nization (FEC Form 1). See example on page 8 is not the taxpayer identification number required (opposite). The registration statement also serves by the Internal Revenue Service. See Appendix G as the official designation of the treasurer and for information on contacting the IRS.) Only com- custodian of records, the only two committee mittees that have previously filed a Statement of officers required under the law. 102.2(a)(1). Organization should fill in this block with the num- ber that was originally assigned to the committee. Line-by-Line Instructions All new committees will be assigned identification Line 1. Name and Address of Committee numbers when the completed statement has been received. Thereafter, the committee must enter the Enter the full, official name of the committee. The number on all statements and reports. 102.2(c). name of a principal campaign committee and any other authorized committee must include the Line 4. Is This Statement New or an Amendment? name of the candidate. 102.14(a). By contrast, Check “New” if you are filing Form 2 for the first an unauthorized committee (such as a PAC or time. Otherwise, check “Amended.” (Amend- party committee) may not use the name of a ments are discussed under “Changes in Com- candidate in its official name. An unauthorized committee may, however, use the candidate’s mittee and/or Contact Information,” below.) name in the title of a special fundraising project Line 5. Type of Committee or other communication, but only if the title clearly and unambiguously shows opposi- The committee must identify itself as either tion to the named candidate. 102.14(b)(3). a principal campaign committee or other authorized committee. The committee The address provided on this line is con- must choose only one committee type. sidered the committee’s address of record. All Commission correspondence will be The committee must also disclose the following sent to this address. 102.2(a)(1)(i). information about the candidate who authorized The committee must disclose the URL for its it: name, party affiliation, office sought and state website, if one exists. If the committee is the and Congressional district (if applicable) in which principal campaign committee of a candidate for the candidate seeks election. 102.2(a)(1)(v).3 the House or the Senate, it must also disclose its 3 Joint fundraising representatives should refer to e-mail address. 102.2(a)(1)(viii). All committees Appendix C, Section 5 for information on filing Form 1. 9 Chapter 2 Line 6. Affiliated Committees A principal campaign committee COMMITTEE REGISTRATION (PAGE 2) lists the names and addresses of Page 2 all other committees authorized FEC Form 1 (Revised 02/2009) 5. TYPE OF COMMITTEE by the candidate as affiliated Candidate Committee: committees. Other authorized (a) X This committee is a principal campaign committee. (Complete the candidate information below.) committees list only the principal (b) This committee is an authorized committee, and is NOT a principal campaign committee. (Complete the candidate information below.) campaign committee as an affili- Name of Candidate Jane Doe ated committee. 102.2(b)(1)(i). Candidate IND Office State VA Party Affiliation Sought: X House Senate President District 12 Line 7. Custodian of Records Enter the name, address and com- mittee position of the individual who has actual possession of the COMMITTEE REGISTRATION (PAGE 3) committee’s financial records. The committee’s treasurer, FEC Form 1 (Revised 02/2009) Page 3 Write or Type Committee Name assistant treasurer or another Doe for Congress person (such as an accountant 6. Name of Any Connected Organization, Affiliated Committee, Joint Fundraising Representative, or Leadership PAC Sponsor or bookkeeper) may serve as the Friends of Jane Doe custodian of records. 102.2(a) (1)(iii). (Recordkeeping rules 229 Hidden View Ln. are discussed in Chapter 11.) Mailing Address Line 8. Treasurer and Springfield VA 00000 CITY STATE ZIP CODE Assistant Treasurer Relationship: Connected Organization X Affiliated Committee Joint Fundraising Representative Leadership PAC Sponsor Provide the name and mailing address of the treasurer. 102.2(a) 7. Custodian of Records: Identify by name, address (phone number -- optional) and position of the person in possession of committee books and records. (1)(iv). The Commission also urges Herman Lotze all political committees to name an Full Name 319 Main St. assistant treasurer (or “designated Mailing Address agent”). Only a registered assistant Springfield VA 00000 treasurer may sign FEC reports Title or Position CITY STATE ZIP CODE and statements in the treasurer’s absence. 102.7(a). The treasurer’s Bookkeeper Telephone number 703 555 0000 responsibilities are discussed in 8. Treasurer: List the name and address (phone number -- optional) of the treasurer of the committee; and the name and address of detail in the previous section. any designated agent (e.g., assistant treasurer). Full Name Gottlob Frege Line 9. Campaign Depository of Treasurer 319 Main St. Mailing Address A committee must list the name and address (but not the Springfield VA 00000 CITY STATE ZIP CODE account number) of the campaign Title or Position Treasurer 703 555 0000 depositories it maintains for Telephone number depositing receipts and mak- ing disbursements. 102.2(a)(1) (vi). Each political committee shall maintain at least one checking account or transaction account at one of its depositories. 103.2. (One depository is required.) All committee disbursements must be made by check or similar 10 Starting the Campaign In the case of paper filers, the Form COMMITTEE REGISTRATION (PAGE 4) 1 or letter needs to include only: • The name and address of the FEC Form 1 (Revised 0 2 /2009) Page 4 committee (Form 1, Line 1); Full Name of Designated Bob Helpsalot • The date the change Agent 319 Main St took effect (Line 2); Mailing Address • The FEC ID number (Line 3); Springfield VA 00000 CITY STATE ZIP CODE • An indication that the Title or Position Assistant Treasurer 703 555 0000 statement is an amend- Telephone number ment to the Statement of Organization (Line 4); 9. Banks or Other Depositories: List all banks or other depositories in which the committee deposits funds, holds accounts, rents safety deposit boxes or maintains funds. Name of Bank, Depository, etc. • The changed information Big National Bank (appropriate line number); and Mailing Address 12345 Wilson Blvd • The name and signature of the treasurer (or assis- Arlington VA 00000 tant treasurer) and the CITY STATE ZIP CODE date signed. 102.2(a)(2). drafts drawn on a designated campaign deposi- tory. 103.3(a). (Cash disbursements of $100 or less per transaction may be made from a petty cash fund. 102.11.) The following institutions may be designated: state banks, national banks and depositories insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration. 103.1, 103.2 and 103.3(a). Changes in Committee Officers and/or Contact Information A committee must report any change or correc- tion of information contained in its registration statement within 10 days after the change. 102.2(a) (2). A committee may have to file an amendment, for example, to report a new treasurer, a new assistant treasurer, a new e-mail address, a change of address or a new campaign depository. The com- mittee must indicate on FEC Form 1 (or in a letter, if the committee does not file electronically) that the statement is an amendment to its registration. The amount of information required on an amended Statement of Organization depends on whether the committee files on paper or electronically. If the committee files electroni- cally, it must submit a fully completed Form 1. 11 Chapter 2 12 Understanding Contributions ChAPTEr 3 Understanding Contributions 1. What Is a Contribution When an intermediary or conduit collects and transmits contributions to the campaign A contribution is anything of value given, loaned the special rules in Appendix A apply. or advanced to influence a federal election. It is important to understand which receipts In-Kind Contributions are considered contributions because: Definition • Contributions count toward the threshold Goods or services offered free or at less than that determines whether an individual has the usual charge result in an in-kind contribution. qualified as a candidate under the Federal Similarly, when a person pays for services on the Election Campaign Act (the Act). 100.3(a). committee’s behalf, the payment is an in-kind • Contributions are subject to the contribution. 100.52(d)(1) and 100.111(e)(1). An Act’s prohibitions against contribu- expenditure made by any person in cooperation, tions from certain sources. consultation or concert with, or at the request or suggestion of, a candidate’s campaign is also • Contributions are subject to the Act’s considered an in-kind contribution to the candi- limits on the amount of contributions. date. 109.20. See Appendix D, “Communications.” Like all receipts, contributions are also subject to Limits the Act’s recordkeeping and reporting require- ments. The section below describes different types The value of an in-kind contribution—the of contributions. (Contribution limits and prohibi- usual and normal charge—counts against the tions are discussed in the chapters that follow.) contribution limit as a gift of money does. Additionally, like any other contribution, in-kind contributions count against the contributor’s limit for the next election, unless they are 2. Types of Contributions otherwise designated. See Chapter 4, Section 4 for more information on designating contribu- tions. 100.52(d)(1), 100.54 and 100.111(e)(1). Gifts of Money Value A contribution of money may be made by check, cash (currency), credit card or other Goods (such as facilities, equipment, supplies written instrument. 100.52(c). See also AOs or mailing lists) are valued at the price the 1999-22, 1995-09 (contributions made over item or facility would cost if purchased or the Internet), 1991-01, 1990-04 and 1978-68. rented at the time the contribution is made. For example, if someone donates a personal computer to the campaign, the contribu- Earmarked Contributions and Bundling tion equals the ordinary market price of the An earmarked contribution is one which the computer at the time of the contribution. contributor directs (either orally or in writ- Services (such as advertising, printing or con- ing) to a candidate through an intermediary sultant services) are valued at the prevailing or conduit. 110.6(b). Special rules govern commercial rate at the time the services are this type of transaction; see Appendix A. rendered. 100.52(d)(2) and 100.111(e)(2). 13 Chapter 3 Notifying Recipient if a contributor spends $20 to buy a campaign The contributor needs to notify the recipient T-shirt that cost the campaign $5, the contributor candidate committee of the value of an in-kind has made a $20 contribution. See also Chapter contribution. The recipient needs this information 14, Section 4, “Sale of Campaign Assets.” in order to monitor the contributor’s aggregate contributions and to report the correct amount. Loans A loan, including a loan to the campaign from a In-Kind Contributions Designated for More member of the candidate’s family, is considered Than One Election in an Election Cycle a contribution to the extent of the outstanding In Advisory Opinion 1996-29, the Commission balance of the loan. (Bank loans, however, are not determined that the value of an in-kind contri- considered contributions if made in the ordinary bution of used computer equipment, received course of business and on a basis that assures before the primary and designated in writing by repayment. 100.82(a) through (e). See Chapter 6, the contributors for all elections in the cycle, Section 1.) An unpaid loan, when added to other could, in fact, be allocated among all elections in contributions from the same contributor, must the same election cycle. The contribution was not exceed the contribution limit. Repayments distinguishable from the type of in-kind contri- made on the loan reduce the amount of the bution that is used for one particular election contribution. Once repaid in full, a loan no longer (such as printing or mailing costs related to a counts against the contributor’s contribution limit. general election fundraiser). If the candidate had However, a loan exceeding the limit is unlawful lost the primary election, the committee would even if it is repaid in full. Besides being reported have had to refund the amount designated for as a contribution, a loan must be continuously the general election (in this case, the candidate reported until it is fully repaid. 100.52(a) and (b), was active in each election within the election 100.111(a) and 104.3(d). See Chapter 13, Section cycle). The total value of the contribution could 17, for more information on reporting loans. not exceed the contributor’s combined limit for all the elections in the cycle. The Commission Endorsements and did not address the issue of allocating an in-kind contribution over more than one election cycle. Guarantees of Loans An endorsement or guarantee of a loan, including a Exceptions loan derived from a candidate’s brokerage account Under limited exemptions in the law, persons may or other line of credit, counts as a contribution provide certain goods and services to a commit- to the extent of the outstanding balance of the tee without making contributions. For example, loan. Repayments made on the loan reduce the when services are volunteered—not paid for by amount of the contribution. Once the loan is anyone—the activity is not considered a contribu- repaid in full, the endorsement or guarantee no tion. 100.74. See Chapter 7 for more information. longer counts against the endorser’s or guaran- tor’s contribution limit. If a written loan agreement does not stipulate the portion for which each Proceeds from Sales endorser or guarantor is liable, then individual The entire amount paid to attend a political contributions are calculated by dividing the fundraiser or other political event or to purchase amount of the loan by the number of persons who a fundraising item sold by a political committee have endorsed or guaranteed it. 100.52(b)(3). is a contribution and counts against the indi- vidual’s contribution limit. 100.53. For example, Candidate’s Use of Jointly Held Collateral if a contributor pays $100 to buy a ticket to a A limited exception to this rule is provided fundraising dinner, the entire $100 is considered when a candidate uses property jointly held a contribution to the committee, even though the with the candidate’s spouse to guarantee a bank meal may have cost the committee $30. Similarly, loan to the campaign and the bank requires the 14 Understanding Contributions spouse’s signature. Note that this exception paid “irrespective of the candidacy,” and thus not applies only if the value of the candidate’s share considered a contribution, compensation must: of the property exceeds or equals the amount • Result from bona fide employment that is of the loan. This exception also applies when the genuinely independent of the candidacy; candidate’s spouse is the endorser, guarantor or co-signer of a loan derived from a candidate’s • Be exclusively made in consideration for brokerage account, credit card account or other services provided by the employee; and line of credit. For unsecured loans, the spouse • Not exceed the amount paid to any other would not be considered a contributor if the similarly qualified person for the same candidate uses, in connection with the campaign, work over the same period of time. only one-half of the available credit. 100.83. For 113.1(g)(6). See AOs 2006-13, 2004-17, more information, see Chapter 4, Section 12. 2004-08, 1980-115 and 1979-74. Note that when a candidate is on leave without Extensions of Credit pay, the continued payment of fringe benefits An extension of credit outside of a creditor’s (such as health insurance and retirement) may ordinary course of business is considered a con- also result in contributions from the employer tribution. 100.55. If the creditor is incorporated, to the campaign. 114.12(c). (The Commission an extension of credit beyond the ordinary has made an exception to this rule for employ- course of business would result in a prohibited ers who had pre-existing policies providing for contribution. For more information on when an a limited extension of benefits for individuals extension of credit is considered a contribution, who take unpaid leave. See AO 1992-03.) see Chapter 14, Section 6, “Settling Debts.” Advances by Individuals Personal Funds of Individuals General Rule Funds from the Candidate When an individual uses personal funds (or per- Unlike the other types of contributions listed sonal credit) to pay for a campaign expense, that here, contributions (including loans or advances) payment is generally an in-kind contribution from made from the candidate’s personal funds to that individual. 100.52(a). For example, an in-kind his or her campaign are not subject to any contribution results if a campaign staff member limits, though they must still be reported. pays for postage, office supplies or campaign mate- 110.10(a); AOs 1991-09, 1990-09 and 1985- rials with personal funds. This rule also applies to 33. For further information, see Chapter 4, payments made by volunteers and by the candidate. Section 12, “Candidate’s Personal Funds.” Travel expenses later reimbursed by the committee are treated differently. 116.5. See Chapter 7, Section Unearned Income and Fringe Benefits 4, “Travel Cost Exemptions” for more information. A candidate’s salary or wages earned from bona Although such advances are considered in- fide employment are considered his or her kind contributions until reimbursed, special personal funds. 100.33. However, compensation reporting rules apply when individuals pay for paid to a candidate in excess of actual hours campaign expenses and later receive reim- worked is generally considered a contribution bursement from the committee. See Chap- from the employer. 100.54; see also AO 2000- ter 13, Section 11, “Reporting Reimbursed 01. Moreover, under FEC regulations barring Advances of Personal Funds (Non-Travel).” personal use of campaign funds, a third party’s payment of a candidate’s expenses is considered Travel Exception a contribution, unless the payment would have When a campaign staff member, volunteer or been made irrespective of the candidacy. To be the candidate uses personal funds to pay for that individual’s own travel expenses (transportation, 15 Chapter 3 meals and lodging), incurred on behalf of a candi- date, the payments are not considered contribu- tions if they fall under one of two exceptions: • Exempt Unreimbursed Travel: Any individual may spend up to $1,000 per candidate, per election, on transportation expenses without making a contribution, and volunteers may spend unlimited amounts on meals and lodging in connection with volunteer activity. 100.79. • Reimbursed Travel: Any other payments by individuals for travel expenses are not considered contributions if the committee reimburses them within specified time limits. 116.5(b). See Chapter 7, Section 4, “Travel Cost Exemptions” for more information. Congressional Staff The official staff of members of Congress cannot contribute to their employing member’s campaign. See 18 U.S.C. §603. As such, it is important for those individuals to avoid advancing any funds to the campaign (e.g., buying stamps for a campaign mailing). See also 18 U.S.C. §602 for informa- tion on solicitation of federal employees. 16 Contribution Limits ChAPTEr 4 Contribution Limits Under the Federal Election Campaign Act (the Act) $5,000 Per Election— contributions are subject to limits. The chart on the next page summarizes the Act’s contribution limits. Multicandidate Committees This chapter examines the rules concerning the Political committees that have qualified as limits placed on contributions to a candidate’s multicandidate committees have a higher con- campaign. The limits apply to all types of contribu- tribution limit: $5,000 per election. 110.2(a) tions (except contributions made from a candi- and (b)(1). To qualify as a multicandidate com- date’s personal funds, as explained in Chapter 3). mittee, a political committee must have: It is important to note that a campaign is pro- • Been registered for at least six months; hibited from retaining contributions that exceed • Received contributions from more the limits. 110.9. In the event that a campaign than 50 contributors; and receives excessive contributions, it must fol- • Made contributions to at least five candidates low special procedures for handling such funds for federal office. Note, however, that state (within 60 days); see “Remedying an Excessive party organizations are not required to Contribution” in Section 7 of this chapter. meet this third requirement. 100.5(e)(3). When making a contribution to a candidate’s campaign, a multicandidate PAC or party com- 1. Overview of Limits mittee must notify the campaign in writing that it has qualified for multicandidate committee status. This section outlines the limits the Act places on 110.2(a)(2). (The notice may be pre-printed on the contributions to a candidate’s campaign. The term committee’s checks, letterhead or other appropri- campaign is used in this Guide to mean a candidate ate materials.)1 When the contributing committee for a specified federal office, his or her authorized fails to provide such a notification, the candidate agents, the principal campaign committee and any committee’s treasurer should verify whether that other authorized committees. 2 U.S.C. §441a(a). committee has qualified in order to avoid accepting an excessive contribution. 103.3(b). Multicandidate $2,500 Per Election status can be verified by consulting the FEC’s Public Under the Act, individuals and groups (that are Records Office of the FEC website (http://www. not prohibited from making contributions, such as fec.gov/disclosure.shtml). Committees that have partnerships, sole proprietorships, certain LLCs satisfied the criteria for multicandidate status and and Indian tribes) may contribute a maximum of have filed FEC Form 1M (Notification of Multi- $2,500 per election to a candidate’s campaign. candidate Status) will be identified as “qualified.” (This limit is indexed for inflation in odd-numbered years, beginning in 2005.) Note that this limit applies to contributions from the members of a candidate’s family (e.g., spouse, parent). The limit also applies to contributions from political com- mittees other than multicandidate committees (see 1 As explained in the Explanation and Justification to “Contributions from Other Candidates” below; rules on contributions by multicandidate political authorized committees of federal candidates have committees, prescribed January 1, 1994, 58 Fed. Reg. a $2,000 per election limit). 110.1(a) and (b)(1). 42173( August 6, 1993), available online at http://www. fec.gov/law/cfr/ej_compilation/1993/1993-17.pdf. 17 Chapter 4 CONTRIBUTION LIMITS for 2011 – 12 Donors recipients Special Limits State, District Candidate PAC1 and Local Party National Party Committee Committee2 Committee3 Biennial Limit of $117,000* $10,000 Individual $2,500* $5,000 per year $30,800* ($46,200 to all candidates per election4 per year per year and $70,8005 to all PACs and combined limit parties) State, District $5,000 $5,000 and Local Party per election per year <none> Committee combined limit combined limit Unlimited transfers to other party committees $43,100* to National Party $5,000 $5,000 Senate candidate Committee per election per year per campaign6 $5,000 PAC $5,000 $5,000 $15,000 per year <none> Multicandidate7 per election per year per year combined limit PAC $2,500* $10,000 $5,000 $30,800* Not Multicandidate per election8 per year <none> per year per year combined limit * These limits are indexed for inflation in odd-numbered years. 1 These limits apply both to separate segregated funds (SSFs) and political action committees (PACs). Affiliated committees share the same set of limits on contributions made and received. 2 A state party committee shares its limits with local and district party committees in that state unless a local or district committee’s independence can be demonstrated. These limits apply to multicandidate committees only. 3 A party’s national committee, Senate campaign committee and House campaign committee are each considered national party committees, and each have separate limits, except with respect to Senate candidates—see Special Limits column. 4 Each of the following is considered a separate election with a separate limit: primary election, caucus or convention with the authority to nominate, general election, runoff election and special election. 5 No more than $46,200 of this amount may be contributed to state and local parties and PACs. 6 This limit is shared by the national committee and the Senate campaign committee. 7 A multicandidate committee is a political committee that has been registered for at least six months, has received contributions from more than 50 contributors and—with the excep- tion of a state party committee—has made contributions to at least five federal candidates. 8 A federal candidate’s authorized committee(s) may contribute no more than $2,000 per election to another federal candidate’s authorized committee(s). 2 U.S.C. §432(e)(3)(B) and 11CFR 102.12(c)(2). 18 Contribution Limits $43,100 National Party Committee permissible), see “Contributions from Unregis- tered Organizations” in Chapter 10, Section 1. Limit for Senate Candidates With respect to their contributions to Sen- Affiliated Committees—Shared Limit ate candidates, the national committees of the Republican and Democratic parties each share a Contributions from affiliated committees are subject to one overall contribution limit, per $43,100 limit with their party’s national Senato- candidate, per election. Consequently, it is impor- rial campaign committee. Unlike other candidate tant to understand the concept of affiliation. contribution limits, this one applies to the total contributions made to a Senate candidate by those Political committees established, financed, party committees for the entire campaign period maintained or controlled by the same person, (the primary and general elections). 110.2(e). This organization or group are affiliated. 110.3(a) limit is indexed for inflation in odd-numbered years. and (b). This definition applies to all types of political committees, including nonconnected committees, party committees, corporate/ $100 Limit on Cash Contributions labor PACs and authorized committees. A campaign may not accept more than $100 in cash from a particular source with respect to any campaign for nomination for elec- Party Committees tion, or election to federal office. 110.4(c). Although a state party committee operates under its own contribution limit, local party committees within a state are presumed to be affiliated with $50 Limit on Anonymous Contributions the state party committee.2 This means that contri- An anonymous contribution of currency is limited butions from those local party committees that are to $50. If the campaign receives a larger anony- required to register as federal political committees mous contribution, the excess amount may be used count against the state committee’s limit. 110.3(b) for any lawful purpose unrelated to any federal (1)(ii) and (3). See AOs 2005-02 and 1999-04. election, campaign or candidate. 110.4(c)(3). Note, however, that the national party com- mittee, the House campaign committee and Contributions from Other Candidates the Senate campaign committee are each A candidate’s authorized committees may accept considered a separate committee, with a contribution of up to $2,000 per election from separate contribution limits (except for the the authorized committee of another federal special $43,100 limit for Senate candidates, as candidate. 102.12(c)(2) and 102.13(c)(2). explained above). 110.2(e) and 110.3(b)(2). In addition, principal campaign committees of active candidates cannot qualify as multicandidate Unregistered Local Party Organizations committees. 102.12(c) and 102.13(c). The prin- Local party organizations that do not have to cipal campaign committee of a former candidate register with the FEC may contribute an aggregate may, however, become a multicandidate com- of $1,000 to federal candidates (assuming no other mittee. AOs 1993-22, 1988-41 and 1985-30. federal expenditures are made) without triggering a reporting requirement with the FEC. 100.5(a).The The applicable contribution limit for contribu- organization must be able to show that the contri- tions from a nonfederal campaign is $2,500 bution was made with funds permissible under the per election. 110.1. However, a contribution Federal Election Campaign Act. 102.5. Prior to cross- of more than $1,000 may trigger registration by the nonfederal campaign as a federal politi- 2 A local party committee may be considered independent of the state party committee if it can cal committee. 100.5(a). For more information meet certain standards as determined by the FEC and other applicable restrictions (such as the through its Advisory Opinion process. See 110.3(b) requirement that the funds given be federally (3)(i) and (ii). See also AOs 1999-04 and 1978-09. 19 Chapter 4 ing the registration threshold, the local organiza- tion does not share a contribution limit with the 2. how Limits Work state party committee. AOs 2005-02 and 1999-04. The limits on contributions to candidates apply Corporate/Labor/Membership separately to each federal election in which the candidate participates. A primary election, general Organization PACs election, runoff election and special election are All separate segregated funds (also called political each considered a separate election with a sepa- action committees or PACs) established, financed, rate limit.3 100.2. (A special election may itself maintained or controlled by the same corporation involve separate primary, general and/or runoff or labor organization are affiliated. For example: elections, each with a separate contribution limit.)4 • PACs established by a parent corpora- In some cases, a party caucus or convention is tion and its subsidiaries are affiliated. considered a primary election, as explained below. • PACs established by a national or international union and its local unions are affiliated. Party Caucus or Convention • PACs established by a federation of national A party caucus or convention constitutes an elec- or international unions and the federation’s tion only if it has the authority under relevant state and local central bodies are affiliated. state law to select a nominee for federal office. (Notable examples of these types of conven- • PACs established by an incorporated tions are those held in Connecticut, Utah and membership organization and its related Virginia.) Otherwise, there is no separate limit for state and local entities are affiliated. a caucus or convention; it is considered part of 100.5(g)(2) and (3); 110.3(a)(1)(ii) and (2). the primary process. When the caucus or conven- When committees are not automatically affili- tion does constitute a primary election, reports ated under the conditions described above, the must be filed for the convention as they would Commission may nevertheless conclude that for the primary. 100.2(c)(1) and (e). See also, for two or more committees are affiliated based on example, AOs 1992-25, 1986-21 and 1986-17. See factors listed in the regulations. 100.5(g)(4)(ii) Chapter 12 for information on filing reports. (A)-(J) and 110.3(a)(3)(ii)(A)-(J). The Commission makes these decisions, through advisory opinions, Candidates Who Lose in the Primary on a case-by-case basis. For examples, see AOs A candidate is entitled to an election limit only if 2009-18, 2006-12, 2005-03, 2004-32, 2002-11 and he or she seeks office in that election. Thus, a can- 2001-07 (plus opinions cited within those AOs). didate who loses the primary (or otherwise does not participate in the general election) does not Authorized Committees have a separate limit for the general. If a candidate An authorized committee, however, can be affili- accepts contributions for the general election ated only with another authorized committee of before the primary is held and loses the primary the same candidate. 100.5(g)(5) and 110.3(a) (or does not otherwise participate in the general (1)(i). Note that, by definition, an unauthorized election), the candidate’s principal campaign com- committee sponsored by an officeholder (i.e., a mittee must refund, redesignate or reattribute the “leadership PAC”) is not considered to be affili- ated with any authorized committees sponsored 3 Presidential campaigns should note that all by the same individual. 100.5(e)(6) and (g)(5). Presidential primary elections held during a calendar year are considered one election for the purposes of the contribution limits. 110.1(j)(1). 4 In AO 2009-15, the Commission ruled that an authorized committee may accept contributions that may be used in a special or emergency election or runoff, even though an election has not been scheduled and may not occur. 20 Contribution Limits general election contributions within 60 days of election may spend unused primary contributions the primary or the date that the candidate publicly for general election expenses. The contributions withdraws from the primary race.5 110.1(b)(3) would continue to apply toward the contributors’ and 110.2(b)(5). See also in this chapter, Section limits for the primary. 110.3(c)(3). The campaign 4, “Designated and Undesignated Contributions” of a candidate running in the general election may and Section 8, “Contributions to Retire Debts.” use general election contributions for primary election debts; the contributions would still count Independent and Non- against the contributor’s general election limits. 110.1(b)(3)(iv). As noted above, should the can- Major Party Candidates didate lose the primary, contributions accepted Even when independent and non-major party for the general must be refunded, redesignated or candidates are not involved in an actual pri- reattributed within 60 days and may not be used mary, they are entitled to a primary limit. to repay primary election debt. AO 1986-17. There- They may choose one of the following dates fore, candidates should ensure they have enough to be their “primary” date, and, until that date, cash on hand to make those refunds if needed. they may collect contributions that count towards the contributor’s primary limits. Unopposed Candidates; • The last day on which, under state law, a candidate may qualify for a position Elections Not Held on the general election ballot; or A candidate is entitled to a sepa- rate contribution limit even if: • The date of the last major primary elec- tion, caucus or convention in that state. • The candidate is unopposed in an election; Non-major party candidates may also • A primary or general election is not held choose the date of the nomination by their because the candidate is unopposed;7 or party as their primary date. 100.2(c)(4). • The general election is not held because the candidate received a majority of Primary vs. General Election votes in the previous election. Campaigns must adopt an accounting system to The date on which the election would have distinguish between contributions made for the been held is considered the date of the elec- primary election and those made for the general tion. 110.1(j)(2) and (3). The campaign must file election, as discussed in Chapter 10, Section pre-election reports and, in the case of a general 1, “Fundraising.” 102.9(e). 6 Nevertheless, the election, a post-election report. AO 1986-21. See campaign of a candidate running in the general also Chapter 12, Section 3, “When to Report.” 5 In AO 2008-04, the Commission ruled that the authorized committee of a Presidential Recounts candidate receiving primary matching funds may issue refunds or obtain redesignations to his or A federal campaign may establish a recount fund her Senate campaign for contributions made either as a separate bank account of the candidate’s in connection with the general election. authorized committee or as a separate entity. 6 In AO 2007-03, the Commission ruled that a Although they are not considered contributions Presidential candidate could solicit and receive private under the Act, any funds solicited, received, directed, contributions for the 2008 Presidential general election transferred or spent in connection with a recount without losing eligibility to receive public funding if the candidate received his party’s nomination for are subject to the amount limitations, source President, provided that the campaign (1) deposited prohibitions and reporting requirements of the Act and maintained all private contributions designated for the general election in a separate account, (2) refrained 7 A primary election that is not held because the from using these contributions for any purpose, and candidate was nominated by a caucus or convention (3) refunded the private contributions in full if the with authority to nominate is not a separate election candidate ultimately decided to receive public funds. with a separate contribution limit. 110.1(j)(4). 21 Chapter 4 under provisions of the Bipartisan Campaign Reform • An undesignated contribution made8 after the Act (BCRA) that restrict officeholders and candi- candidate has won the primary, but before dates when soliciting, receiving, directing, transfer- the general election, applies toward the ring or spending funds in connection with a federal contribution limit for the general election. election. See 2 U.S.C. §441i(e). This means that the • In the case of the candidate who has lost normal contribution limits, reporting requirements the primary, an undesignated contribution and source restrictions apply. For more informa- made after the primary automatically applies tion and reporting instructions, see AO 2006-24. toward the limit for the next election in which the candidate runs for federal office. • If the candidate does not plan to run for fed- 3. Contributions to eral office in the future, the committee may: Unauthorized Committees −Presumptively redesignate the con- tribution to retire any primary debts If a contributor makes a contribution to a they may have. 110.1(b)(5)(ii)(C); see committee not authorized by any candidate “Remedying Excessive Contributions” and knows that a substantial portion of the below for proper procedure; or contribution will be contributed to or spent on behalf of a particular candidate, the contribution −Request written redesignation from counts against the contributor’s per-election the contributor to retire debts limit with respect to that candidate. 110.1(h). from a previous election cycle.9 Otherwise, the committee must return or refund the contribution. 4. Designated and For additional information on presumptive redesig- Undesignated Contributions nation, see Section 7 of this chapter, “Remedying an Excessive Contribution.” 110.1(b)(2)(ii) and (b)(3). The Commission strongly recommends that cam- paigns encourage contributors to designate their How Contributions Are Designated contributions for specific elections. Designated contributions ensure that the contributor’s intent Contributors designate contributions by indicat- ing in writing the specific election to which they is conveyed to the candidate’s campaign. In the intend a contribution to apply. 110.1(b)(2)(i). case of contributions from political committees, Contributors may make this written designation written designations also promote consistency in on the check (or other signed written instru- reporting and thereby avoid the possible appear- ment) or in a signed statement accompanying the ance of excessive contributions on reports. contribution. 110.1(b)(4). A designation also occurs when the contributor signs a form supplied by Effect of Designating vs. the candidate. 110.1(b)(4); see also AO 1990-30. Not Designating 8 See Section 5 for an explanation of Designated contributions count against the when a contribution is “made.” donor’s contribution limits for the elec- 9 Note that if a contribution designated to retire the tion that is named. Undesignated contribu- debt of a previous campaign exceeds the amount of the debt, the contribution must be returned, tions count against the donor’s contribution refunded, redesignated or reattributed. Contributions limits for the candidate’s next election. can be designated for debt retirement only if debt exists and if the contributor has not already met the For example: contribution limit for that election. 110.1(b)(3)(i). 22 Contribution Limits Campaign Must Retain Designations Date Contribution is Received The campaign must retain copies of contribu- The date of receipt is the date the campaign tion designations for three years. If the designa- (or a person acting on the campaign’s behalf) tion appears on the check (or other written actually receives the contribution. 102.8(a). instrument), the campaign must retain a full-size This is the date used by the campaign for photocopy. 102.9(c) and (f); 110.1(l)(1). reporting purposes, but it also affects the application of the net debts outstanding rule (discussed in Section 8 of this chapter). 5. Date Contribution Is Made Contributions Charged on Credit Cards vs. Date of receipt When the committee receives contributions through credit card charges, the date of receipt The date a contribution is made by the is the date on which the committee receives contributor and the date the contribution the contributor’s signed authorization to charge the contribution. The treasurer should retain a is received by the campaign are significant copy of the authorization form in the commit- for purposes of the contribution limits. It is tee’s records. See AOs 1995-09 and 1990-04. important to understand the distinction. In-Kind Contributions Date Contribution is Made The date of receipt for an in-kind contribu- tion is the date the goods or services are The date a contribution is made is the provided to the committee, even if the con- date the contributor relinquishes con- tributor pays the bill for the goods or services trol over it. 110.1(b)(6). For example: after they are provided. See 110.1(b)(6). • A hand-delivered contribution is considered made on the date it is delivered by the Effect of Dates on Undesignated contributor to the campaign. 110.1(b)(6). Contributions • A mailed contribution is made on the date of The date an undesignated contribution is made the postmark. 110.1(b)(6). Note that if a cam- determines which election limit it counts against. paign wishes to rely on a postmark as evidence The date of receipt, however, does not affect of the date a contribution was made, it must the application of the contribution limits. An retain the envelope or a copy of it. 110.1(l)(4). undesignated contribution made on or before • An in-kind contribution is made on the date Election Day counts against the donor’s limit that the goods or services are provided by the for that election, even if the date of receipt is after Election Day and even if the campaign has contributor. See AOs 2004-36 and 1996-29. no net debts outstanding. On the other hand, • A contribution made via the Internet an undesignated contribution made after an is considered made on the date the election counts against the donor’s limit for contributor electronically confirms mak- the candidate’s next election. 110.1(b)(2)(ii). ing the transaction. AO 1995-09. • An earmarked contribution is considered made Effect of Dates on Designated during the election cycle in which the contribu- Contributions tion is actually made, regardless of the year in Both the date of receipt and the date a contribu- which the election is held. See AOs 2008-08 tion is made affect the application of the net debts and 2006-30 (footnote 5). (Note that the con- outstanding rule to a designated contribution. The duit must forward this information to the cam- date the contribution is made determines whether paign.) See Appendix A for more information. the rule will apply, while the date of receipt governs 23 Chapter 4 whether the contribution is acceptable under the Attribution rule. For example, a contribution designated for If the check or statement does not indicate how the primary and made before that election will not much should be attributed to each donor, the be subject to the net debts outstanding rule, even recipient committee must attribute the contribu- if the campaign receives the contribution after the tion in equal portions. 110.1(k)(1) and (2). For primary. By contrast, a contribution designated example, if a committee receives a $1,000 joint for—but made after—the primary is acceptable contribution signed by two individuals but with only to the extent the campaign has net debts no written attribution, the committee must outstanding for the primary on the date of receipt. attribute a $500 contribution to each donor. 110.1(b)(3)(i) and (iii). See Section 8 of this chapter. A campaign may request that a contribu- tion be reattributed, as explained below. Date of Deposit While all contributions must be deposited within 10 days, the date of deposit is not used 7. remedying an Excessive for reporting or contribution limit purposes. Contribution When a committee receives an excessive contribu- 6. Joint Contributions tion—one which exceeds the contributor’s limit or the campaign’s net debts outstanding for an A joint contribution is a contribution that is made election—the committee may remedy the violation by more than one person using a single check or by refunding the excessive amount or by seeking a other written instrument. Although each individual redesignation or reattribution of it within 60 days. has a separate contribution limit, joint contribu- Step-by-step procedures for obtaining a reat- tors may combine their contribution limits by tribution or redesignation are explained below. contributing a joint contribution (for example, a check for $5,000 for a candidate’s primary election) as long as both sign the check (or an Redesignation attached statement), as explained below. 110.1(k). By Contributor With a redesignation, the contributor instructs Each Contributor Must Sign the Check the committee to use the excessive portion of a When making a joint contribution, each con- contribution for an election other than the one tributor must sign the check (or other written for which the funds were originally given. For instrument) or a statement that accompanies example, the contributor may redesignate the the contribution. 110.1(k)(1). Note that if the excessive portion of a contribution made for check or an accompanying statement of attribu- the primary election so that it counts against his tion is not signed by each contributor, the entire or her limit with respect to the general election contribution will be attributed only to the party (provided the contributor has not already con- who signed the check. 104.8(c). However, under tributed the maximum for the general election). certain circumstances the committee may pre- When requesting a redesignation, the com- sumptively reattribute the excessive portion mittee must inform the contributor that he of a contribution. See “Reattribution” below. or she may, alternatively, request a refund of the excessive amount. 110.1(b)(5). Exception: Partnerships and LLCs Contributions from partnerships and Presumptive Redesignation by Committee certain LLCs are not considered joint Under certain circumstances, the committee may contributions, but do trigger special attribu- make a presumptive redesignation of an excessive tion requirements; see Appendix B. contribution. When an individual or a non-multican- 24 Contribution Limits didate committee makes an excessive contribution each contributor.10) Note that a joint contribu- to a candidate’s authorized committee, the cam- tion must represent the personal funds of each paign may presumptively redesignate the excessive contributor because contributions made in the portion to the general election if the contribution: name of another are prohibited. 110.4(b). • Is made before that candi- When requesting reattributions, the committee date’s primary election; must also inform contributors that they may, • Is not designated in writ- alternatively, ask for a refund of the excessive ing for a particular election; portions of their contributions. 110.1(k)(3). • Would be excessive if treated as a pri- mary election contribution; and Presumptive Reattribution • As redesignated, does not cause the By Committee contributor to exceed any other contri- When a committee receives an excessive contribu- bution limit. 110.1(b)(5)(ii)(B)(1)-(4). tion made via a written instrument with more than Also, the excessive portion of an undesignated one individual’s name imprinted on it, but only one contribution made after the primary, but before signature, the committee may attribute the permis- the general election, may be automatically sible portion to the signer. The committee may applied to the primary if the campaign’s net make a presumptive reattribution of the excessive debts outstanding from the primary equal or portion to the other individual whose name is exceed the amount redesignated. 110.1(b) imprinted on the written instrument, without (5)(ii)(C). See Section 8 in this chapter. obtaining a second signature, so long as the reat- The committee is required to notify the contribu- tribution does not cause the contributor to exceed tor in writing of the presumptive redesignation any other contribution limit. 110.1(k)(3)(ii)(B)(1). within 60 days of the treasurer’s receipt of the con- The committee is required to notify the contribu- tribution, and must offer the contributor the option tors in writing of the presumptive reattribution to receive a refund instead. 110.1(b)(5)(ii)(C). within 60 days of the treasurer’s receipt of the It is important to note that presumptive contribution, and must offer the contributors the redesignations may be made only within option to receive a refund if it was not intended the same election cycle. Also, presumptive to be a joint contribution. 110.1(k)(3)(ii)(B)(2)-(3). redesignation is not an option when the con- tributor is a multicandidate committee. When to Request Redesignations and Reattributions Reattribution In many circumstances, the committee will be By Contributor able to presumptively redesignate or reattrib- With a reattribution, the contributor instructs ute contributions. For all other circumstances, the committee in writing to attribute the exces- contributions can be redesignated or reat- sive portion of a joint contribution to another tributed only by the individual contributor. individual. For example, if the committee receives A committee may ask a contributor to redes- an excessive contribution drawn on a joint check- ignate and/or reattribute a contribution ing account, but signed by only one account (within 60 days of the treasurer’s receipt), for holder, the committee may seek a reattribution example, when the committee receives: signed by each contributor of the excessive amount to the other account holder. 110.1(k) 10 See the Explanation and Justification published with the final rule, 52 Fed. Reg. 760, 765-766 (3). (A joint contribution may also be reattrib- (January 9, 1987), available online at http://www. uted so that a different amount is attributed to fec.gov/law/cfr/ej_compilation/1987/1987-1.pdf. 25 Chapter 4 • A designated or undesignated con- and receive a redesignation and/or reattribution tribution that exceeds the donor’s within the 60-day limit, as explained below. limit. 110.1(b)(5)(i)(A) and (C). Step 3: Be Prepared to Make Refund • A designated or undesignated contribu- tion for an election in which the candidate When a committee deposits contributions that is not running. For example, a contribution may exceed the limits or net debts outstanding that was designated for the general but was for an election, the committee must not spend received before the primary may be redes- the funds because they may have to be refunded. ignated for a future primary if the candidate To ensure that the committee will be able to loses the primary or otherwise does not refund the contribution in full, the committee run in the general election. 102.9(e); see may either maintain sufficient funds in its regular also AOs 1996-29, 1992-15 and 1986-17. campaign depository or establish a separate account used solely for the deposit of possibly • A contribution that is designated for, but illegal contributions. 103.3(b)(4). Furthermore, made after, an election and that exceeds the committee must keep a written record not- the campaign’s net debts outstanding for ing the reason a contribution may be excessive that election. 110.1(b)(3)(i) and (5)(i)(B). and must include this information when reporting • An undesignated contribution (which normally the receipt of the contribution. 103.3(b)(5). applies to the candidate’s upcoming election) that the committee wants to use to retire Step 4: Request Redesignation and/or Reattribution debts of a previous election. Note that, if it When requesting a redesignation, the committee is redesignated, the contribution then counts asks the contributor to provide a written, signed against the donor’s contribution limits for redesignation of the contribution for another elec- that previous election. 110.1(b)(5)(i)(D). tion. The request must also state that the donor may receive a refund of the excessive portion Procedures for Obtaining of the contribution if he or she does not wish to redesignate it. 110.1(b)(5)(ii)(A). See also the Redesignations and Reattributions FEC’s Interpretive Rule on Electronic Redesigna- from Contributors tions, 76 FR 16233 (March 23, 2011), available The committee treasurer is the person ulti- on the FEC website at http://www.fec.gov/law/ mately responsible for complying with the cfr/ej_compilation/2011/notice_2011-02.pdf. procedures outlined below. 103.3(a) and (b). When requesting a reattribution, the committee asks the contributor whether the contribution Step 1: Deposit Contribution was intended to be a joint contribution from A committee must deposit contributions within more than one person. Alternatively, if the original 10 days of the treasurer’s receipt. (If a contribu- contribution was a joint contribution, the commit- tion is not deposited, it must be returned to the tee requests that contributors adjust the amount contributor within 10 days of receipt. A contri- attributable to each.11 In either case, the committee bution is returned when it is sent back to the should inform contributors that they must each contributor without being deposited.) 103.3(a). sign the reattribution. The request must notify each contributor that, instead of reattributing the contri- Step 2: Determine Whether Excessive bution, he or she may seek a refund of the portion The committee must determine whether a of the contribution that exceeds the limits or the contribution exceeds the donor’s limit or the campaign’s net debts outstanding. 110.1(k)(3)(ii)(A). campaign’s net debts outstanding. The Commission 11 See the Explanation and Justification published encourages committees to make this determina- with the final rule, 52 Fed. Reg. 760, 766 (January tion within 30 days of receiving the contribution. 9, 1987), available online at http://www.fec.gov/ This allows a committee sufficient time to request law/cfr/ej_compilation/1987/1987-1.pdf. 26 Contribution Limits Step 5: Redesignation/Reattribution Made or Make Refund Within 60 Days 8. Contributions to Within 60 days after the date of the commit- retire Debts tee’s receipt of the contribution either: If a committee has net debts outstand- • The contributor must provide the committee ing after an election is over, a campaign with a redesignation or reattribution; or may accept contributions after the elec- • The committee must refund the exces- tion to retire the debts provided that: sive portion of the contribution. • The contribution is designated for that elec- 103.3(b)(3). tion (since an undesignated contribution made after an election counts toward the limit for A contribution is properly redesignated if, the candidate’s upcoming election, unless within the 60-day period, the contributor the campaign requests its redesignation); provides the committee with a written, signed statement redesignating the contribution • The contribution does not exceed the con- for a different election. 110.1(b)(5)(ii)(B). tributor’s limit for the designated election; and A contribution is properly reattributed if, within • The campaign has net debts outstand- the 60-day period, the contributors provide the ing for the designated election on the day it receives the contribution. committee with a written statement reattributing the contribution. The statement must be signed 110.1(b)(3)(i) and (iii). by all contributors and must indicate the amount attributable to each donor. (If the contributors do How to Calculate Net not specify how to divide the contribution, the Debts Outstanding committee must attribute the contribution equally among the contributors.) 110.1(k)(2) and (3)(ii)(B). A campaign’s net debts outstanding consist of unpaid debts incurred with respect to the Step 6: Keep Records and Report particular election minus cash on hand plus the total amounts owed to the campaign in the The committee must keep documentation for form of credits, refunds of deposits, returns each reattribution and redesignation to verify and receivables or a commercially reason- that it was received within the 60-day time limit. able estimate of the collectible amount, and Documentation for a reattribution or a redes- loans exceeding $250,000.12 110.1(b)(3)(ii). ignation must include one of the following: • A copy of the postmarked envelope Unpaid Debts bearing the contributor’s name, return Unpaid debts include the following: address or other identifying code; • All outstanding debts and obligations; • A copy of the signed statement reat- • The estimated cost of raising funds tributing or redesignating the contribu- to liquidate the debts; and tion with a date stamp showing the • If the campaign is terminating, estimated date of the committee’s receipt; or winding down costs (for example, office • A copy of the written redesignation or rental, staff salaries and office supplies). reattribution dated by the contributor. 110.1(b)(3)(ii). 110.1(l)(6). 12 For an illustration of how the net debts outstanding The documentation relating to a reat- calculation is performed, see the Explanation and Justification published with the final rule, 52 Fed. Reg. tribution or redesignation must be 762 (January 9, 1987), available online at http://www.fec. retained for three years. 102.9(c). gov/law/cfr/ej_compilation/1987/1987-1.pdf#page=3 27 Chapter 4 Cash on Hand 10. Contributions from Cash on hand consists of the resources available to pay the campaign’s total debts, including currency, Limited Liability deposited funds, traveler’s checks, certificates of Companies deposit, treasury bills and any other investments valued at fair market value. 110.1(b)(3)(ii)(A). Corporation v. Partnership For the purpose of calculating net debts For purposes of contribution limitations and outstanding for the primary, cash on hand prohibitions, a limited liability company (LLC) is need not include contributions desig- treated as either a corporation or a partnership. nated for the general. 110.1(b)(3)(iv). An LLC is treated as a corporation if: • It has chosen to file, under Internal Revenue Adjustment to Net Debts Total Service (IRS) rules, as a corporation; or A campaign first calculates its net debts out- • It has publicly traded shares. 110.1(g)(3). standing as of the day of the election. Thereafter, An LLC is treated as a partnership if: the campaign continually recalculates its total • It has chosen to file, under IRS net debts outstanding as additional funds are rules, as a partnership; or received for, or spent on, the election for which • It has made no choice, under IRS the debt remains. 110.1(b)(3)(ii) and (iii). rules, as to whether it is a corpora- tion or a partnership. 110.1(g)(2). Contributions Exceeding Net Debts If an LLC is treated as a corporation, it is pro- If, on the same day, a campaign receives several hibited from making contributions to candidate contributions that, together, exceed the amount committees, but it can establish an SSF (see needed to retire its debts, the campaign may: Chapter 5 for general information on the cor- porate prohibition). If it is considered a partner- • Accept a proportionate amount of each ship, it is subject to the contribution limits for contribution and either refund the remaining partnerships outlined in Appendix B. 110.1(g). amount or ask contributors to redesignate the excessive portions for another election; or Single Member LLC • Accept some contributions in full and If a single member LLC does not require either return or refund the others or corporate tax treatment, it may make con- seek redesignations or reattributions for tributions; the contributions will be attrib- them. (See “Redesignations” and “Reat- uted to the single member, not the LLC. tributions” in Section 7 above.) Notifying Recipient Committee 110.1(b)(3). An LLC must, at the time it makes a contri- bution, notify the recipient committee: 9. Contributions from • That it is eligible to make the contribution; and Partnerships • How the contribution is to be attributed among members. Partnerships are permitted to make contribu- This requirement will prevent the recipi- tions according to special rules. 110.1(e) and ent committee from inadvertently accept- (k)(1). For further details, see Appendix B. ing an illegal contribution. 110.1(g)(5). 28 Contribution Limits • Dividends and interest from, and pro- 11. Contributions from Minors ceeds from sale or liquidation of, stocks and other investments; An individual who is under 18 years old may make • Income from trusts, if established contributions to candidates and political commit- before the election cycle; tees, subject to the limit of $2,500 per election, if: • Income from trusts established by • The decision to contribute is made know- bequests (even after candidacy); ingly and voluntarily by the minor; • Bequests to the candidate; • The funds, goods or services contributed are owned or controlled by the minor, • Personal gifts that had been customar- ily received by the candidate prior to the proceeds from a trust for which he or she beginning of the election cycle; and is a beneficiary or funds withdrawn by the minor from a financial account opened • Proceeds from lotteries and simi- and maintained in his or her name; and lar games of chance. • The contribution is not made using funds 100.33(a) and (b). given to the minor as a gift for the purpose Assets Jointly Held with Spouse of making the contribution, and is not in any A candidate may also use, as personal funds, his way controlled by another individual. 110.19. or her portion of assets owned jointly with a spouse (for example, a checking account or jointly owned stock). If the candidate’s financial interest 12. Candidate’s in an asset is not specified, then the candidate’s Personal Funds share is deemed to be half the value. 100.33(c). Some banks may require a spouse to cosign When candidates use their personal funds for a loan obtained by the candidate using jointly campaign purposes, they are making contribu- held assets as collateral. While an endorsement tions to their campaigns. Unlike other contribu- or guarantee of a loan normally constitutes a tions, these candidate contributions are not contribution, in this instance the spouse is not subject to any limits. 110.10; AOs 1991-09, considered a contributor as long as the candidate’s 1990-09, 1985-33 and 1984-60. They must, share in the collateral equals or exceeds the however, be reported (as discussed below). amount of the loan. 100.52(b)(4); AO 1991-10. Contributions from members of the candidate’s EXAMPLE: A candidate obtains a $5,000 bank family are subject to the same limits that apply to loan for his campaign using, as collateral, property valued at $20,000 held jointly (in equal shares) any other individual. For example, a candidate’s with his wife. Both co-sign the loan. Because the parent or spouse may not contribute more candidate’s interest in the property is $10,000, than $2,500, per election, to the candidate. which exceeds the amount of the loan, his wife has not made a contribution by co-signing it. Definition of a Candidate’s “Personal Funds” What Are Not Considered The personal funds of a candidate include: Personal Funds • Assets which the candidate has a legal right Personal Gifts and Loans of access to or control over, and which If any person, including a relative or friend of the he or she has legal title to or an equitable candidate, gives or loans the candidate money interest in, at the time of candidacy; in connection with his or her campaign, the • Income from employment; funds are not considered personal funds of the 29 Chapter 4 candidate even if they are given to the candidate hand as of the day after the election, as a contribu- directly. Instead, the gift or loan is considered a tion by the candidate. 116.11(c). AO 2003-30. contribution from the donor to the campaign, Note that a runoff election has a separate limit subject to the per-election limit and report- for purposes of FEC regulations at 116.11. For able by the campaign. This is true even if the example, if a candidate loaned the committee candidate uses the funds for personal living $345,000 for the primary election, the committee expenses while campaigning. 100.52; See AOs could repay the candidate up to $250,000 from 1985-33 and 1982-64; see also AO 1987-01. contributions made after the date of the primary Bank Loans Used in Connection with Campaign election. Similarly, if the candidate loaned $300,000 for a primary runoff election, the committee could Bank loans are not considered contributions from repay the candidate up to $250,000 from contribu- the bank if they comply with FEC regulations on tions made after the date of the runoff election. bank loans. (See “Bank Loans” in Chapter 6.) When a candidate obtains a bank loan for use in connection with his or her campaign, the loan is considered to be from the bank and not from the candidate’s personal funds. The candidate is acting as the agent of the campaign. 102.7(d) and AO 1985-33. 13. repayment of Personal Loans from Candidate For personal loans (including advances of per- sonal funds or endorsements of bank loans to the committee) from the candidate to his or her authorized committee made on or after November 6, 2002, that aggregate more than $250,000, the following rules apply sepa- rately to the primary and general elections: • The committee may use contributions to repay the candidate for the entire amount of the loan or loans only if those contributions were made on or before the day of the election; and • The committee may use contributions to repay the candidate only up to $250,000 of the personal loans from contributions made after the date of the election. 116.11(b). Furthermore, if the committee uses the amount of cash-on-hand as of the date of the election to repay the candidate for loans in excess of $250,000, it must do so within 20 days of the elec- tion. 116.11(c). During that time, the committee must treat the portion of candidate loans that exceed $250,000, minus the amount of cash-on- 30 Prohibited Contributions ChAPTEr 5 Prohibited Contributions Campaigns are prohibited from accepting con- Federal Election Campaign Act permits corporations, tributions from certain types of organizations labor organizations, incorporated membership and individuals. 110.9, 110.20, 114.2(c) and 115.2. organizations, trade associations and national banks These prohibited sources are listed below.1 to use their treasury funds for certain election- If a committee is uncertain whether a con- related activities that benefit candidates. See tribution comes from a prohibited source, it Chapter 7, Sections 8 and 9 for more information. must follow the procedures described under “Questionable Contributions,” below. Federal Government Contractors Campaigns may not accept or solicit contributions from federal government contractors. 115.2. Since 1. Prohibited Sources corporate contributions are already prohibited, the government contractor ban applies primarily to contributions from a partnership (or a limited Corporations, Labor Organizations, liability company) with a government contract. It National Banks also applies to the personal and business funds of (1) individuals under contract to the federal Campaigns may not accept contributions made government and (2) sole proprietors of busi- from the general treasury funds of corpora- nesses with federal contracts. 115.4 and 115.5. tions, labor organizations or national banks.2 114.2(a), (b) and (d). This prohibition applies The spouses of individuals and sole propri- to any incorporated organization, including etors who are federal government contrac- a nonstock corporation, a trade association, tors and employees of federal government an incorporated membership organization contractors, however, may make contributions and an incorporated cooperative.3 from personal funds. 115.5 and 115.6. EXAMPLE: The owner of an incorporated “mom and pop” grocery store is not permitted to use a Foreign Nationals business account to make contributions. Instead, Campaigns may not solicit or accept contribu- the owner would have to use a personal account. tions from foreign nationals.4 Federal law prohibits contributions, donations, expenditures and dis- A campaign may, however, accept contributions bursements solicited, directed, received or made from separate segregated funds (PACs) established directly or indirectly by or from foreign nationals by corporations, labor organizations, incorporated in connection with any election — federal, state membership organizations, trade associations and or local. This prohibition includes contributions national banks. 114.2 and 114.5. Moreover, the or donations made to political committees and 1 These organizations and persons are, in turn, prohibited building funds and to make electioneering com- from making contributions in connection with, or for the munications. 110.20(b)-(g). Furthermore, it is purpose of influencing, federal elections. 114.2(a) and (b). a violation of federal law to knowingly provide 2 National banks and federally chartered corporations substantial assistance in the making, acceptance may not make contributions in connection with any election—federal, state or local. 114.2(a). 4 Foreign nationals may not make contributions 3 However, a political committee that has or donations in connection with any election— incorporated for liability purposes only is not federal, state or local—either directly or considered a prohibited source. 114.12(a). through any other person. 110.20(b). 31 Chapter 5 or receipt of contributions or donations in con- “Green Card” Exception nection with federal and nonfederal elections An individual who is not a citizen of the United to a political committee, or for the purchase or States is eligible to make a contribution if he construction of an office building. 110.20(h). This or she has a “green card” indicating that he or prohibition includes, but is not limited to, acting she is lawfully admitted for permanent resi- as a conduit or intermediary for foreign national dence in the United States. 110.20(a)(3)(ii). contributions and donations. 110.20(g) and (h). Domestic Subsidiaries of Foreign Corporations A person acts knowingly for the purposes of this section when he or she has: In advisory opinions, the Commission has said that a United States corporation that is a sub- • Actual knowledge that the funds have sidiary of a foreign corporation may sponsor a come from a foreign national; separate segregated fund which can in turn make • Awareness of certain facts that would contributions to federal candidates as long as: lead a reasonable person to believe that • The foreign parent does not finance election- there is a substantial probability that the related contributions or expenditures money is from a foreign national; or either directly or through the subsidiary.5 • Awareness of facts that should have • No foreign national (including the foreign prompted a reasonable inquiry into whether parent) participates in the operations the source of funds is a foreign national. of the separate segregated fund or in 110.20(a)(4). its administration (such as by appointing officers) or in any decision to make dona- Pertinent facts that satisfy the “know- tions, contributions, disbursements or ing” requirement include knowledge of: expenditures in connection with any federal • Use of a foreign passport or passport number; or nonfederal election. See 110.20(i). • Use of a foreign address; See also AOs 2009-14, 2006-15, 2000-17, 1995-15, 1992-16, 1990-08 and 1985-03. • A check or other written instru- ment drawn on an account or wire Determining Nationality of Contributor transfer from a foreign bank; or The Commission stated, in AO 1998-14, that the • Contributor or donor living abroad. use of any surname on a contribution check (or similar instrument) would not, by itself, give any 110.20(a)(5)(i)-(v). reason to inquire as to the person’s national- ity. Nonetheless, the Commission advised the Definition of Foreign National committee to take the following minimally A foreign national is: intrusive steps to ensure that the contributions it received did not come from foreign nationals: • An individual who is: (1) not a citizen of the United States and (2) not lawfully • Ensure that public political ads and solicita- admitted for permanent residence (as tions directed to audiences outside the defined in 8 U.S.C. §1101(a)(20)); or U.S. contain a summary of the foreign national prohibition of 2 U.S.C. §441e. • A foreign principal, as defined in 22 U.S.C. • Make further inquiry into the nationality of the §611(b). Section 611 defines a foreign prin- contributor if the committee receives a contri- cipal as a group organized under the laws bution postmarked from any non U.S. territory. of a foreign country or having its principal place of business in a foreign country. The • Make further inquiry into the nationality of statute specifically mentions foreign gov- the contributor if the committee receives a ernments, political parties, partnerships, 5 Refer to AO 1982-34 for a discussion of associations and corporations. 110.20(a)(3). financing the administrative costs of an SSF. 32 Prohibited Contributions contribution indicating that either the bank tion limits or the campaign’s net debts outstanding or the account owner has a foreign address. are described in Chapter 4, Sections 7 and 8.) In all of the above instances, if the contribution is submitted along with credible evidence (e.g., a copy Return or Deposit Contribution of a valid U.S. passport) that the contributor is a When receiving a contribution of questionable U.S. citizen, a U.S. national or a permanent resident legality, a committee must, within 10 days of alien, no further inquiry need be made. However, the treasurer’s receipt, take one of two steps: if the committee has actual knowledge that the • Return the contribution to the contributor is in fact a foreign national, it may not donor without depositing it; or rely on these documents as a defense. 110.20(a)(7). • Deposit the contribution. 103.3(b)(1). Contributions in the Name of Another Be Prepared to Make Refund A contribution made by one person in the name of another is prohibited. 2 U.S.C. 441f; If it decides to deposit the questionable con- tribution, the committee must make sure that 110.4(b). For example, an individual who has the funds are not spent because they may already contributed up to the limit to the cam- have to be refunded. To ensure this, the com- paign may not give money to another person mittee may either maintain sufficient funds in to make a contribution to the same candidate. its regular campaign depository or establish a Similarly, a corporation is prohibited from using separate account used solely for the deposit bonuses or other methods of reimbursing of possibly illegal contributions. 103.3(b)(4). employees for their contributions. 114.5(b)(1). Document the Possibility Candidate Employed by of Illegal Contribution Prohibited Source The committee must keep a written record As noted in Chapter 4, Section 12, a candidate’s noting the reason why a contribution may salary or wages earned from bona fide employ- be prohibited and must include this informa- ment are considered his or her personal funds. tion when reporting the receipt of the con- 100.33(b). However, compensation paid to a tribution. 103.3(b)(5). See also Chapter 11, candidate in excess of actual hours worked, or in Section 2, “Recording Receipts,” under the consideration of work not performed, is gener- subheading “Possibly Illegal Contributions.” ally considered a contribution from the employer. 113.1(g)(6)(iii). If the employer is a corporation, Seek Evidence of Legality federal government contractor, or another pro- hibited source, the excess payment would result Within 30 days of the treasurer’s receipt of a in a prohibited contribution under the regulations possibly prohibited contribution, the committee must make at least one written or oral request applicable to that employer. See 110.20 (foreign for evidence that the contribution is legal. Evi- nationals), 114.2(c) (corporations and labor dence of legality includes, for example, a written organizations) and 115.2 (federal contractors). statement from the contributor explaining why the contribution is legal, or an oral explana- tion that is recorded by the committee in a 2. Questionable Contributions memorandum. 103.3(b)(1) and AO 1995-19. If a committee receives a contribution of question- able legality, it must follow the five procedures Confirm Legality or described below. 103.3(a) and (b). (Procedures for Refund Contribution handling contributions that exceed the contribu- Within these 30 days, the committee must either: 33 Chapter 5 • Confirm the legality of the contribution; or Contributor Unknown • Refund the contribution. 103.3(b)(1). If, however, the identity of the original contribu- tor cannot be determined or is in question, the Disgorge Prohibited Contribution committee may disburse the funds to a gov- ernmental entity (federal, state or local), or to Discovered Late a qualified charitable organization described in If a committee deposits a contribution that 2 U.S.C. §170(c). AOs 1995-19 and 1991-39. appears to be legal and later discovers that it is prohibited (based on new information not Prohibited In-kind Contribution available when the contribution was deposited), If the prohibited contribution was an in-kind the committee must disgorge the contribution contribution, the committee should disgorge an within 30 days of making the discovery. 103.3(b) amount equal to the value of the contribution (2). This situation might arise, for example, if the to the appropriate party as determined above. committee learned that a past contributor was a foreign national or had a contract with the federal Insufficient Funds government. As another example, the committee If the committee does not have sufficient might find out that a corporation reimbursed funds to disgorge the contribution when the employees for their contributions to the commit- illegality is discovered, the committee must tee (and had thus made corporate contributions use the next funds it receives. 103.3(b)(2). and contributions in the name of another). Contributor Known If the identity of the original contributor is known, the committee must refund the funds to the source of the original contribution. 103.3(b)(2). Alternatively, the committee may pay the funds to the U.S. Treasury. AO 1996- 05; but see Fireman v. United States, 44 Fed. Cl. 528 (1999).6 To do so, send the funds to: U.S. Department of the Treasury Financial Management Services Credit Accounting Branch 3700 East-West Highway Hyattsville, MD 20782 The committee should include a cover let- ter that explains that the funds being sent represent potential violations of the Federal Election Campaign Act and requests that the funds be placed in the “general fund account.” 6 In Fireman, the Court of Federal Claims suggested that a contributor of illegal contributions might have a right to have the contributions refunded to him rather than disgorged to the U.S. Treasury 34 Other Reportable Receipts ChAPTEr 6 Other Reportable Receipts This chapter describes campaign receipts that exceed the amount of the loan and any senior liens. are not considered contributions and, therefore, The committee must ensure that the bank has are not subject to contribution limits; all receipts established a “perfected security interest” in the must nevertheless be reported by the campaign. collateral (that is, has taken steps to legally protect its interest in the collateral in the event that the committee defaults on the loan). 100.82(e)(1)(i). 1. Bank Loans Note that if a candidate obtains a loan using assets jointly owned with his or her spouse, the amount of the loan may not be greater than the Conditions candidate’s share of the property (usually one A candidate or his or her committee may half); otherwise, a contribution from the spouse obtain a loan, including a line of credit, results. 100.52(b)(4). (See Chapter 4, Section 12, from a bank, provided that the loan: under the subheading, “Assets Jointly Held with Spouse” for a narrow exception to this rule.) • Bears the bank’s usual and customary inter- est rate for the category of loan involved; Guarantees or Endorsements. An endorsement • Is evidenced by a written instrument; or guarantee of a bank loan is considered a contribution by the endorser or guarantor and is • Is subject to a due date or amor- thus subject to the law’s prohibitions and limits on tization schedule; and contributions. 100.52(b)(3) and 100.82(e)(1)(ii). • Is made on a basis which assures repayment (see below). Pledge of Future Receipts 100.82(a). If the committee pledges its future receipts as security for the loan, then the amount loaned by If a loan fails to meet any of these condi- the bank may not exceed a reasonable estimate of tions, then a prohibited contribution anticipated receipts, based on documentation pro- from the lending institution results. vided by the candidate or committee (such as cash flow charts or fundraising plans). 100.82(e)(2)(i) Methods of Assuring Repayment and (ii). Future receipts might include, for example, A loan is made on a basis which assures repayment anticipated contributions or interest income. if it is obtained using one or more of the follow- The committee must also set up a separate ing authorized methods of securing the loan: account for the receipt of funds pledged for the repayment of the loan. The account may be Traditional Methods established with either the lending institution or a A committee may use one of the follow- different depository. If the account is established ing traditional methods of securing the at a depository other than the lending institution, loan, or a combination of the two: then the committee must execute an assignment Collateral. A loan may be secured using assets of of the account’s funds to the lending institution the candidate or the committee, such as real estate, and notify the depository of the assignment. The personal property, cash on deposit, certificates loan agreement must require the committee to of deposit and stocks. The fair market value of deposit the pledged funds into the account estab- the assets must, on the date of the loan, equal or lished for this purpose. 100.82(e)(2)(iii) and (iv). 35 Chapter 6 Other Methods of Assuring Repayment credit directly to the lending institution or to The Commission may, on a case-by-case basis, the candidate. 100.83(d). All such loans to the approve methods of assuring repayment other committee derived by these methods must be than those described above. 100.82(e)(3). See, reported by the committee. 100.83(e). The com- for example, AO 1994-26. A committee should mittee must report the loan from the candidate request an advisory opinion from the Commis- as a receipt and repayment of the loan to the sion before entering into a loan agreement that candidate as a disbursement. 104.3(a)(3)(vii) relies on alternative sources of repayment. and (b)(2)(iii)(A). See Chapter 13, Section 18. Schedule C-1/C-P-1 When a committee obtains a loan from a bank 3. Overdrafts or other permissible lending institution (or the candidate obtains one on behalf of his or her If a bank honors a check written by a political committee), the committee must file Schedule committee with insufficient funds in its check- C-1 (or Schedule C-P-1 for Presidential can- ing or savings account, no contribution from didates) with the report covering the period the bank results as long as the overdraft: in which the loan was obtained. 104.3(d)(1). If the loan is obtained by the committee (rather • Is made on an account subject to than by the candidate), the treasurer must sign automatic overdraft protection; the schedule and attach a copy of the loan • Is subject to a definite interest rate which or line of credit agreement. See Chapter 13. is the usual and customary rate; and Both Schedule C-1 and Schedule C-P-1 (for Presidential candidates) include a statement to • Is subject to a definite repayment schedule. be signed by an officer of the lending institution 100.82(d). certifying that the information provided by the An overdraft that does not meet the above committee is accurate and that the terms and conditions of the loan comply with FEC rules. conditions is a prohibited contribution. 114.2. Note that if the overdraft protection is based on a line of credit extended by the bank, 2. Brokerage Loans and draws on that line of credit must be disclosed on Schedule C-1, as discussed above. Other Lines of Credit Obtained by Candidate Candidates may use funds derived from an 4. Investment Income advance on their brokerage account, credit card account or other line of credit to finance Interest earned on investments, such as interest their campaigns, if the extension of credit is: earned on invested funds and dividends earned on securities, are not considered contribu- • In accordance with applicable law; tions. Such funds, however, must be transferred • Under commercially reasonable terms; and back into the main campaign depository before • Made by persons who make such loans being disbursed by the campaign. Additionally, in the normal course of their business. tax laws apply. If a committee receives inter- 100.83(a). est from a bank it must list that bank on the The candidate’s authorized committee has committee’s Form 1.See 103.3(a); AOs 1999- the option of repaying loans derived from a 08, 1997-06, 1986-18 and 1980-39, as well as candidate’s brokerage account or other line of Appendix G, “Compliance with Other Laws.” 36 Other Reportable Receipts 5. Offsets to Operating Expenditures Offsets to operating expenditures, such as returns by vendors of deposits, reimbursements for expenses shared by committees, refunds and rebates are not considered contributions. Note, however, that rebates to campaigns must be offered in the ordinary course of business and on the same terms and conditions as those offered to nonpoliti- cal entities. Otherwise, the rebate may be consid- ered a contribution—a prohibited contribution if a corporation pays the rebate. See, for example, AOs 2004-37 (see responses to Questions 2 and 4), 1996-02, 1994-10, 1987-24 and 1986-22. 6. Legal and Accounting Services The value of legal and accounting services provided without charge in accordance with the guidelines described in the next chapter is not a contribution. 100.86; 114.1(a)(2)(vii). 37 Chapter 6 38 Sources of Support ChAPTEr 7 Sources of Support Support may be given to campaigns in a Use of Equipment variety of ways, as described below. This exemption covers only the services pro- vided to ensure compliance. The employer cannot donate equipment, such as computers, 1. Contributions to the campaign without making a contribution (a prohibited contribution if the employer is an Contributions are the most common source of incorporated entity). However, the use of the campaign support. Earlier chapters explain the employer’s resources, such as computer equip- Federal Election Campaign Act’s (the Act) limits ment, necessary to enable the employee to provide and prohibitions on contributions. Remember the service is not considered a contribution by that all contributions are reportable. See Chap- the employer. AOs 1989-13 and 1980-137. ter 3, Section 2, “Types of Contributions.” Volunteer Services If an individual personally volunteers legal or 2. Free Legal and accounting services without compensation, Accounting Services the work is considered personal volunteer activity (see “Personal Services,” below) and the above restrictions do not apply. The Exemption Any entity (e.g., a committee, a corporation, a union, a partnership) may provide a campaign with 3. Volunteer Activity free legal and accounting services as long as: • The services are provided only for the purpose of ensuring the cam- Personal Services paign’s compliance with the Act; Basic Rule: No Compensation • The entity paying for the service is An individual may volunteer personal services the regular employer of the indi- to a campaign without making a contribu- vidual performing the service; tion as long as the individual is not com- • The employer does not hire additional pensated by anyone for the services. 100.74. employees to render the services or to free Volunteer activity is not reportable. regular employees to perform the service; and EXAMPLE: An attorney, working as a volunteer (i.e., he receives no compensation from any- • The campaign reports the value of the service one), writes policy papers for the campaign. (the amount paid by the employer), as well as the name of each person who performed the Note, however, that if volunteers are, in fact, paid service and the date the service was provided. by any person for their services, the activity is no longer considered volunteer activity, and the 100.86, 100.146 and 114.1(a)(2) payments, if made by someone other than the (vii). See AO 2006-22. campaign itself, result in in-kind contributions, For more information on reporting free legal and which must be reported by the campaign. 100.54. accounting services, see Chapter 13, Section 9. 39 Chapter 7 (Exception: “Free Legal and Accounting Services,” corporation or union to produce campaign materi- above.) See AOs 2007-08, 1982-04 and 1980-42. als, reimbursement is required regardless of how much time is spent on the activity. 114.9(c). (For Foreign National as Campaign Volunteer information on a campaign’s use of corporate or Although he or she may not make contributions labor facilities, see Section 9, “Use of Corporate/ or expenditures (including advances of personal Labor Transportation and Facilities,” later in this funds), an individual who is a foreign national may chapter. For information on the use by a volun- participate in campaign activities as an uncompen- teer of an employer’s computer and Internet sated volunteer. In doing so, the volunteer must be access, see “Internet Volunteer Activity” below.) careful not to participate in the decision-making process of the campaign. Commission regulations specifically prohibit foreign nationals from par- Use of Real or Personal ticipating in the decisions of any person involving Property: Activities in Home, election-related activity. 11 CFR 110.20(i) and Church, Community Room 2 USC §441e. See AO 2004-26. For example, a foreign national volunteer may attend committee Individuals, in the course of volunteering personal events and campaign strategy meetings, but may services, may use their homes—or the recreation not be involved in the management of the commit- room of the residential complex where they live— tee. 110.20(i); AOs 2007-22, 2004-26 and 1987-25. for campaign-related activities without making a contribution. (A nominal fee paid by an individual Incidental Volunteer Activity at volunteer for the use of a recreation room is not Corporate/Labor Facilities considered an in-kind contribution to the campaign Generally, if an individual provides services to a and is not, therefore, reportable.) Volunteers may campaign during paid working hours, the employer use a church or community room for campaign makes a contribution to the campaign. 100.54 activities as long as the facility is regularly used for and 114.9. However, an employee, stockholder or noncommercial purposes by members of the com- member of a corporation or labor organization munity, without regard to political affiliation. (Again, may make occasional, isolated or incidental use of a nominal fee paid by an individual volunteer for corporate/labor organization facilities for his or the use of the room is not a contribution.) 100.75 her own individual volunteer activities on behalf and 100.76. For rules concerning the use of a home of a campaign. Note that the Commission has said computer, see “Internet Volunteer Activity” below. that the use of facilities during one (1) hour per week or four (4) hours per month is considered Food, Drink, Invitations for Home, “incidental use.” For example, an employee may use an office phone to make calls that pertain to Church or Community Room Event political volunteer work. If the volunteer activity is When holding a campaign-related activity in his limited to “incidental use” of the facilities the vol- or her home, church or community room, an unteer does not have to reimburse the organiza- individual may spend up to $1,000 per candidate, tion for use of the facilities (only for any increased per election, for food, beverage and invitations overhead or operating costs). 114.9(a) and (b). for the event without making a contribution. (For When use of the facilities exceeds “incidental use,” example, two individuals living together may spend the volunteer must reimburse the organization up to $2,000 per candidate, per election.) Any the usual and normal rental fee within a com- amount spent in excess of $1,000, however, must mercially reasonable time. Such reimbursement be reported by the campaign as an in-kind contri- is considered an in-kind contribution from the bution. 100.77. Note that in AO 1980-63, the Com- volunteer and must be reported by the benefiting mission said that if an individual co-hosts an event campaign committee. 100.52(d) and 114.9(a)(2) held in someone else’s home, any expenses paid by and (b)(2). Or, if any person (including an employee, the nonresident co-host are considered contribu- stockholder or member) uses the facilities of a tions to the campaign benefiting from the event. 40 Sources of Support Internet Volunteer Activity and may count as a contribution and/or expen- diture. See Appendix D, “Communications.” General Exception An uncompensated individual or group of uncompensated individuals may engage in certain 4. Travel Cost Exemptions voluntary Internet activities for the purpose of influencing a federal election without restriction. These exempted activities would not result in a Unreimbursed Travel Expenses contribution or an expenditure under the Act and The exemptions described below apply only to would not trigger any registration or reporting an individual’s payments for his or her own travel requirements with the FEC. This exemption applies expenses; if an individual uses personal funds to to individuals acting with or without the knowledge pay the travel expenses of another, an in-kind or consent of a campaign or a political party com- contribution results. 100.93(b). For the general mittee. 100.94 and 100.155. Exempted Internet rules concerning campaign travel, including the activities include, but are not limited to, sending or rules for using non-commercial transportation, forwarding electronic mail, providing a hyperlink to see Chapter 10, Section 4, “Campaign Travel.” a website, creating, maintaining or hosting a website and paying a nominal fee for the use of a website. $1,000 Transportation Exemption An individual (including the candidate, a paid staff Use of Employer’s Computer and Internet Access member or a volunteer) may voluntarily spend A corporation or a labor organization may permit up to $1,000 for unreimbursed transportation its employees, shareholders, officials and mem- expenses on behalf of the campaign without mak- bers to use its facilities for individual volunteer ing a contribution. However, when an individual’s Internet activity, without making a prohibited payments for such transportation expenses contribution. The individual volunteer must comply exceed $1,000 per candidate, per election, the with the corporation’s or labor organization’s payments are considered contributions—unless internal policies for computer and Internet use, they are reimbursed by the candidate’s commit- and must complete the normal amount of work tee in a timely manner (see below). 100.79(a)(1). for which the employee is paid, or is expected to perform. Also, the activity must not increase Volunteer’s Exemption for Meals and Lodging the overhead or operating costs of the organiza- A campaign volunteer may spend unlim- tion, and the activity must not be coerced. The ited amounts for his or her own meals organization may not condition the availability of and lodging without making a contribu- the Internet or the computer on their being used tion, as long as the expenses are inciden- for political activity or for support for or opposi- tal to volunteer activity. 100.79(b). tion to any particular candidate or political party. 114.9(a) and (b). (For rules on communications Reimbursed Travel Expenses by a corporation or labor organization using a When the candidate or an individual work- computer or the Internet, see Section 8, “Cor- ing on behalf of the candidate pays any porate/Labor Exceptions,” later in this chapter.) other travel expense, no contribution will Not Exempt: Paid Web Communications result if the committee reimburses the indi- vidual within the following time limits: If an individual or group of individuals pays a fee to place a communication on another person or • If the expense was paid with cash or entity’s website, the communication is considered a personal check, within 30 days from general public political advertising, and thus quali- the date the expense was incurred. fies as a public communication. 100.26. As such, • If the expense was paid with a credit it may require a disclaimer and/or reporting, card, within 60 days of the closing 41 Chapter 7 date on the credit card billing state- tees involved in the expense must reimburse ment where the charge first appears. that committee for their portion of the expense Outside of these time limits, the payments within a reasonable period of time to avoid a are in-kind contributions. 116.5(b); AO 2003- contribution. See AOs 2007-24, 2004-37 and 31. See Chapter 13, Section 12, “Reporting 2004-36. Note that payments by nonfederal Travel Expenses” for reporting rules. For campaigns for shared expenses involving certain reimbursement for non-commercial travel see public communications must be made from funds Chapter 10, Section 4, “Campaign Travel.” that are subject to the limitations, prohibitions and reporting requirements of the Act. 300.71. 5. Vendor Discounts on “Coattail” Support in Food and Beverages Campaign Materials Under the “coattail” provision of the Act, a A vendor of food or beverages (even if incorpo- federal candidate may be mentioned in some rated) may sell food and beverages to a campaign campaign materials produced by another federal at a discount. The amount charged must at least equal the vendor’s cost for the items. If the value candidate’s campaign or by the campaign of a of the discount—the difference between the nonfederal candidate. The committee making the normal charge and the amount paid by the cam- expenditure must report it, but the candidate paign—does not exceed $1,000 per candidate, named in the ad has no reporting responsibility. per election, the discount is not considered a The payment for the materials is not a con- contribution. Discounts exceeding $1,000, however, tribution to the referenced federal candidate are in-kind contributions and must be reported provided that the guidelines below are followed. as such. A corporate vendor may not exceed the Example: A U.S. House campaign may produce $1,000 discount limit since corporate contribu- a yard sign that includes the name of a U.S. Sen- tions are prohibited. 100.78 and 114.1(a)(2)(v). ate candidate without allocating a portion of the A discount that is given in the ordinary course cost as an in-kind contribution to that candidate of business is not a contribution, regardless of as long as the conditions listed below are met. the value of the discount. 100.78 and 100.138. Guidelines to Qualify for Exemption • The materials must be limited to items 6. Support from Other such as pins, bumper stickers, handbills, Campaigns brochures, posters and yard signs; • The materials must be distributed by volun- This section describes ways in which campaigns teers (for example, by hand) or by mail using may assist one another without making a contribu- lists developed by the candidate’s campaign tion. For the rules on campaign-to-campaign con- (but not by direct mail—see below); and tributions, see Chapter 4, Section 1 under the sub- heading, “Contributions from Other Candidates.” • The materials may not be distributed through public political advertising such as broadcast Shared Expenses media, newspapers, magazines, billboards or direct mail (a mailing by a commercial Campaigns may share common expenses (e.g., vendor or made from a commercial list). rent for a shared headquarters or printing for a brochure that promotes each campaign) without 1 This special provision creates, in part, an exception to the above contribution limits. That is, without a contribution resulting, as long as each com- special treatment, political parties ordinarily would mittee pays its attributed portion of the costs. be subject to the general limitation on contributions If one committee pays a bill, the other commit- by a multicandidate political committee. 42 Sources of Support Note that the portion of the cost allocable to Although these expenditures may be coordinated a federal candidate must be paid from funds with a campaign, the party committee must subject to the limits and prohibitions of the actually make the expenditure on behalf of the Act, even if a nonfederal campaign pays for the campaign; money given directly to the candidate’s materials. 100.88(a) and (b) and 100.148. campaign is not a coordinated party expenditure. Endorsements and Solicitations Coordinated Party Expenditure Limits by Federal Candidates The party’s national committee has a coordi- A public communication in which a federal can- nated spending limit for each U.S. Senate and didate endorses, or solicits funds for, another House nominee in the general election. See candidate for federal or nonfederal office does not 109.32. The national committee may designate result in a contribution to the endorsing (or solicit- (in writing) the party’s national Senatorial Com- ing) candidate unless the communication promotes mittee or national Congressional Committee to or supports the endorsing (or soliciting) candidate spend its allowance with respect to a particular or attacks or opposes his opponent in the election. nominee, but those committees do not have 109.21(g). For more information, see Appendix D, separate spending limits. 109.32(b) and 109.33; “Communications.” See also Appendix E for further see also AO 1976-108. The national committee information on soliciting funds for other candidates. may also designate a state or local party com- mittee to make its expenditures. 109.33(a). 7. Party Support A state party committee has a separate coordi- nated spending limit for each Senate and House In addition to making contributions (up to general election nominee seeking election in that $5,000 per election as a multicandidate commit- state. The state committee may designate (in tee), party committees may support a candidate writing) a national party committee to spend its through other activities described below. These allowance with respect to a particular nominee. other activities are reportable by the political Although local party committees have no sepa- party committee but not by the campaign of the rate coordinated spending allowance, they may candidate receiving the support. Note that some be designated in writing by either the national of these activities may trigger additional report- committee or the state committee to make ing responsibilities or funding provisions for the coordinated party expenditures. 109.33(a) and party committee. For detailed information, see the Campaign Guide for Political Party Committees. (b)(1). When making coordinated party expen- ditures, party organizations that are not federal political committees must nevertheless use funds Coordinated Party Expenditures that are permissible under the Act. 102.5(b). The Act creates a special exception to the Coordinated party expenditure limits for Senate contribution limits for certain party activities supporting candidates. 2 U.S.C. §441a(d). The and House candidates are calculated as follows:2 national party committee and the state party • Senate Candidate: State voting age popula- committee each have an additional special contri- tion x 2 cents, multiplied by the Cost of Living bution limit for coordinated party expenditures Adjustment (COLA); or $20,000 multiplied made in connection with the general election by the COLA, whichever is greater. campaigns of U.S. House and Senate candidates. 109.32. (Coordinated party expenditures are also 2 The Cost of Living Adjustment (COLA) has a considerable effect on party spending limits. For called “441a(d) expenditures” because they are example, the spending limit for a House candidate provided for in 2 U.S.C. §441a(d) of the Act.) for a special election in 2011 is $44,200. 43 Chapter 7 • house Candidate:3 $10,000 multiplied by Party Independent Expenditures the COLA, or, in states with only one rep- resentative, the same as the Senate limit. Party committees may make independent expendi- tures on behalf of, or in opposition to, candidates. The Commission publishes in the Federal Reg- Such expenditures are not subject to contribu- ister, the FEC Record and on the Commission’s tion or coordinated party expenditure limits.5 website, the dollar amounts of the coordi- nated party expenditure limits. 110.17(e). Permissible Sources Since independent expenditures expressly advo- Coordinated Party Expenditures cate the election or defeat of federal candidates, vs. In-Kind Contributions they must be financed with funds from the party’s federal account. For more information regarding When making either coordinated party independent expenditures, see this chapter, Sec- expenditures or in-kind contributions, a party tion 11, and Appendix D, “Communications.” committee purchases goods or services for the benefit of a campaign. The committee may decide whether to treat an expenditure made Exempt Party Activities on behalf of the candidate as a coordinated Two types6 of grassroots activities—preparation, party expenditure or as an in-kind contribution. display and distribution of campaign materials (As previously noted, monetary contributions and slate cards (see below)—undertaken by state given directly to the campaign do not qualify as and local party committees in support of specific coordinated party expenditures.) 109.37(b). federal candidates are unlimited because they are Despite their similarity, coordinated exempt from the definition of contribution. Note party expenditures differ from in-kind that although they are exempt from contribution contributions in several ways: limitations, such activities often qualify as federal election activity and thus may be subject to certain • Coordinated party expenditures may be funding restrictions. Moreover, payments made made in connection with the general election by an unregistered party organization for such only (although they may be made during the materials count towards the organization’s FEC primary period—see 109.34), whereas in-kind registration threshold. For more information on contributions may be made for any election.4 federal election activity (FEA), exempt activities • Coordinated party expenditures count against and party committee registration thresholds, see the special spending limits explained above, the Campaign Guide for Political Party Committees. whereas in-kind contributions count against the committee’s per-candidate, per-election Sources of Funds limits on contributions (e.g., $5,000). Many local party organizations are not registered • Coordinated party expenditures are reported political committees under the Act and may, by the party committee only, whereas in-kind under state law, accept donations that would contributions and party coordinated com- be prohibited or excessive under the Act. These munications are reported by both the party funds may not be used to pay for exempt party committee and the recipient campaign. activities. Instead, the party must use funds 5 See FEC v. Colorado Republican Federal Campaign Committee, 518 U.S. 604 (1996). 3 The limit applies to candidates for Delegate 6 There is a third type of exempt activity for (American Samoa, District of Columbia, Guam, registration and GOTV activity conducted by a Northern Mariana Islands,Virgin Islands) and Resident state or local party committee on behalf of the Commissioner (Puerto Rico). 109.32(b)(2)(ii). Presidential and Vice-Presidential nominees of 4 A post general runoff does not constitute that party. 100.89. For the conditions and details a general election triggering an additional regarding this type of exempt activity, see the §441a(d) expenditure allowance. Campaign Guide for Political Party Committees. 44 Sources of Support that are permissible under federal law. 100.80 is, a mailing by a commercial vendor or from and 100.87; 100.140 and 100.147; 102.5(b). a commercial list).7 100.80 and 100.140. Campaign Materials • The content is limited to the identification of each candidate (pictures may be used), A state or local party committee or organization the office or position currently held, the may prepare and distribute campaign materials office sought and party affiliation. The list such as pins, bumper stickers, handbills, brochures, must exclude any additional biographical data posters or yard signs without having its pay- on candidates and their positions on issues ments for such items considered contributions or as well as statements on party philosophy. expenditures if the following conditions are met: Certain voting information, however, may be • The activity is conducted on behalf of the given, such as time, place and instructions on party’s nominees for the general election. voting a straight party ticket. AO 1978-89. • The materials are distributed by volunteers, See AO 2008-06. not through public advertising such as broadcast media, newspapers, magazines or Reporting billboards or by direct mail (that is, a mailing by The campaign of a candidate supported through a commercial vendor or from commercial lists). exempt party activities is not required to report • The party committee does not use mate- them. If these activities are conducted by a federally rials purchased by the national party registered party committee, the party committee committee or money transferred from must report them. (Note that these exempt activi- the national party committee specifi- ties may trigger federal registration and reporting cally to purchase the materials. obligations for a local party organization. 100.5(c).) • The party committee does not use funds des- ignated by a donor for a particular candidate. 8. Corporate/Labor Exceptions • A payment from a state or local candidate to help pay for the materials does not Although corporations (including incorpo- exceed his or her share of the expenses. rated trade associations and membership 100.87; See AOs 2010-01 and 2008-06. organizations) and labor organizations are prohibited from using their treasury funds Slate Cards and Sample Ballots to make contributions in connection with A state or local party committee or organization federal elections, they are permitted to: may prepare and distribute a slate card, sample • Establish separate segregated funds (popu- ballot, palm card or other printed list naming larly referred to as PACs), which can sup- candidates for any public office. The payments port federal candidates (114.1(a)(2)(iii)); are not considered contributions or expendi- tures on behalf of any federal candidate listed • Provide certain free legal and account- as long as the following conditions are met: ing services to a campaign (See Section 2 of this chapter); • The list names at least three can- didates running for election to any • Allow employees, stockholders and members public office within the state. to make incidental use of their facilities for vol- unteer campaign work (see Section 3 above );8 • The list is not distributed through public advertising such as broadcast media, newspa- pers, magazines or billboards. Note, however, 7 See the Explanation and Justification at 45 Fed. Reg. 15080, 15081-15082 (March 7, 1980), that it may be distributed by direct mail (that available online at http://www.fec.gov/law/cfr/ ej_compilation/1980/1980-8.pdf#page=2. 8 For information on a campaign’s use of corporate/ labor facilities, see Section 9, this chapter. 45 Chapter 7 • Sponsor communications to the restricted Coordination Defined class (e.g., a corporation’s executives and An expenditure is coordinated if it is made in coop- stockholders and their families; a labor eration, consultation or concert with, or at the organization’s members and their families) request or suggestion of, a candidate, a candidate’s that contain express advocacy and may authorized committee, or their agents, or a politi- be coordinated with a candidate; and cal party committee or its agents.9 109.20(a). FEC • Sponsor certain election-related communica- regulations provide for a three-part test to deter- tions to other employees and/or the general mine whether a communication is coordinated, and thus, represents an in-kind contribution (unless public as long as they are not coordinated it is otherwise exempt under FEC regulations). with a candidate. See Citizens United v. FEC. See 109.21 and Appendix D, “Communications.” This section focuses on the last two items. Communications to Restricted Class Restricted Class As noted above, a corporation may use its general A corporation’s restricted class consists of its treasury funds to pay for independent expenditures executive and administrative personnel, its stock- and electioneering communications. See Citizens holders and the families of those two groups. United v. FEC. In addition, under Commission regula- tions a corporation may make certain communica- A labor organization’s restricted class consists tions to its restricted class, as described below. of its members, executive and administrative personnel and the families of those two groups. Coordination A membership organization’s restricted class As corporation or labor organization may com- generally includes the executive and administrative municate with its restricted class in a manner that personnel of the organization, the organization’s expressly advocates the election or defeat of a members and the families of those two groups. clearly identified candidate, and the organization (Note: If a member is incorporated, a member- may coordinate these communications with the ship organization or trade association would candidate without making a prohibited contribu- communicate with the personnel of the member tion. While such coordination does not transform the restricted class communication into an in-kind corporation with whom they normally conduct contribution, it may provide evidence that could business. See the Campaign Guide for Corporations jeopardize the independence of future communica- and Labor Organizations for more information.) tions to those outside the restricted class by the organization or its SSF. 114.2(c) and 114.3(a)(1). Coordination with the Candidate Permitted Restricted Class Communications An expenditure that is coordinated between a Corporations and labor organizations may candidate or the candidate’s campaign and a third engage in certain types of communications to the party is considered an in-kind contribution to the restricted class provided they follow the guidelines candidate, which the candidate must report as a contained in the FEC regulations. The pertinent contribution received and an expenditure made. regulations and some examples are listed below. 104.13(a), 109.20(b) and 109.21(b). Because the • Publications. A corporation or labor orga- Act prohibits corporations and labor organiza- nization may produce and distribute tions from making contributions, it is important to publications that endorse or solicit funds avoid coordination with corporations and labor for a candidate or party (as long as the organizations regarding communications outside publications are not reproductions of the the restricted class except to the extent permit- 9 For the purposes of 11 CFR part 109 only, ted under FEC regulations at 11 CFR 114.4. “agent” is defined at 11 CFR 109.3. 46 Sources of Support candidate’s campaign materials and the with any candidate or party committee to the organization does not actually collect the extent permitted in those sections.10114.2(c). funds). 114.2(f)(4)(ii) and 114.3(a) and (c)(1). Note that any election-related communica- • Web pages and e-mails. A corporation or tions made to those outside the restricted class labor organization may endorse or solicit may also be made to the restricted class. funds for a candidate or party through an e-mail directed solely to members of its Types of Communications restricted class. Likewise, a corporation or Corporations and labor organizations may engage labor organization may set up a web page, in the following types of election-related commu- accessible only by its restricted class, which nications that go beyond the restricted class pro- may contain express advocacy or solicitations. vided they follow the guidelines contained in FEC Note that in either case the organization regulations. The pertinent regulation is listed below. may not actually collect the funds, but may • Campaign-Related Candidate Appearances Before provide the address of the campaign to which All Employees and Their Families. The candidate, contributions may be sent. 114.2(f)(4)(ii) and but not the sponsoring organization, may ask 114.3(a). See also AOs 1997-16 and 1996-01. for support and may solicit contributions. • Candidate and Party Appearances. A candidate Note, however, that the candidate may not or party representative may make an appear- accept contributions, but he or she may leave ance before the restricted class. He or she envelopes and campaign materials for the may solicit and accept contributions before, audience. 114.4(b)(1). Coordination between during or after the appearance. 114.3(c)(2). the candidate and the corporation or labor • Get-Out-The-Vote and Voter Registration Drives organization may include discussions regard- and Phone Banks. The corporation or labor ing the structure, format and timing of the organization may run voter drives and phone appearance, and the candidate’s position on banks urging the restricted class to vote for issues, but may not include any discussion of a particular candidate or to register with the candidate’s plans, projects or needs relat- a particular party. 114.3(c)(3) and (4). ing to his or her campaign. 114.4(b)(1)(vii). • Endorsements. Endorsements may be • Noncampaign-Related Candidate Appearances announced during a candidate appear- Before the General Public. Incumbent federal ance or in a publication to the restricted officeholders may make appearances in their class. 114.3(c) and 114.4(c)(6). official officeholder capacity. The discussion must be limited to issues of concern to the sponsoring organization and avoid any refer- Communications to Those ence to campaign activity or solicitation of con- Outside the Restricted Class tributions. Note that an organization cannot As noted above, a corporation may use its pay for the candidate or the candidate’s staff general treasury funds to pay for independent to travel to such an officeholder event if the expenditures and electioneering communica- candidate holds a campaign event in the same tions. See Citizens United v. FEC. In addition, under area while there. 106.3(b)(3). AO 1996-11. Commission regulations a corporation may • Candidate Appearances at Schools, Colleges or make certain communications to individuals Universities. Candidates may make appearances outside the restricted class, as described below. at educational institutions without the appear- Disbursements by corporations and labor ance being a prohibited contribution, provided organizations for election-related activities that the school makes a reasonable effort to described in 11 CFR 114.4 (i.e., communica- ensure that the appearance is in an academic tions that reach beyond the restricted class) setting (such as a speech or a question/answer will not cause those activities to be contribu- 10 See 114.4(b)(1)(vii), 114.4(c)(2), 114.4(c)(3)(v), 114.4(c) tions or expenditures, even when coordinated (4), 114.4(c)(5)(i) and (ii), 114.4(c)(6)(ii) and 114.4(d)(1). 47 Chapter 7 setting) rather than a campaign setting (such Facilities as a rally or event) and the school does not If a campaign uses the facilities of a corporation or expressly advocate the election or defeat of, labor organization, the campaign must reimburse nor favor, any specific candidate. Alternatively, the organization within a commercially reasonable the facilities of the school may be provided time and at the usual and normal rental charge. to the campaign provided that the usual and Use of facilities may include, for example, the use normal rental charge is paid in the ordinary of telephones, typewriters or office furniture. course of business. For more information on 114.9(d). If another political committee or an such appearances, see 114.4(c)(7)(i) and (ii). individual reimburses a corporation or labor organization for the campaign-related use of its • Candidate Debates. Candidate debates may facilities, the payment is considered an in-kind be sponsored by a broadcaster, bona fide contribution from that committee or individual newspaper, magazine or other periodical or to the campaign. (In the case of a political com- a nonprofit organization (i.e., those organiza- mittee sponsored by the organization providing tions under 501(c)(3) or (c)(4) of the Internal the facilities, it is also advisable that payment be Revenue Code), in accordance with section made to the organization in advance in order 110.13 of the FEC regulations. In particular, a to avoid a prohibited contribution from the debate must include at least two candidates organization.) Note, however, that employees, and should not be structured to promote stockholders and members of a corporation or labor organization may make incidental use of an or advance one candidate over the other. organization’s facilities, subject to the corporation • Endorsements. The corporation or labor or labor organization’s own rules, for volunteer organization may, without coordinating work without having to reimburse the organization with the candidate or his or her campaign, (except for any increased overhead), as explained publicly announce endorsements through in Section 3 of this chapter. 114.9(a) and (b). a press release and press conference con- ducted through its normal media contacts. Meeting Rooms The endorsement may also be posted on a Usual and Normal Rental Rate web page that is accessible to the general public if the corporation or labor organiza- Candidates and political parties may, at the discre- tion of the organization, rent a corporation or tion normally posts its press releases online labor organization’s meeting rooms at the usual and the release is posted along with all other and normal rate, provided reimbursement is made corporate or organization press releases. within a commercially reasonable time. 114.9(d). 114.4(c)(6)(i) and (ii); see AO 1997-16. Provided by Organization’s Political Committee As with other facilities, if the organization’s 9. Use of Corporate/Labor political committee pays for the room as an in-kind contribution, it is advisable that pay- Facilities and resources ment be made in advance to avoid a prohib- ited contribution from the organization. When using the facilities and resources of a corporation (including an incorporated trade For Free or at a Discount association or membership organization) or labor A candidate may be able to use the rooms for free organization, a campaign must pay the organization or at a discount under the following conditions: according to the rules described below. Otherwise, • The corporation or labor organization the use may result in a prohibited contribution customarily makes its meeting rooms avail- from the corporation or labor organization. able to civic and community groups; 48 Sources of Support • The corporation or labor organiza- cases where the fundraiser is a restricted-class tion makes the rooms available to only event and the funds collected are treated other candidates upon request; and not only as contributions to the candidate, but • The corporation or labor organization also as contributions both to and from the SSF makes the rooms available to the candidates of the corporation/labor organization. 114.2(f) on the same terms given to other groups (2)(iii) and (4)(iii). In this case, the event may not (i.e., for free or at a discount if those are raise funds in excess of the SSF’s candidate con- the terms offered to other groups). tribution limit ($5,000 for a multicandidate PAC). Alternatively, the campaign may collect the funds. 114.13. Events Beyond the Restricted Class Use of Corporate/Labor Name or Trademark Event Sponsored by Corporate/Labor SSF Because the organization’s SSF may make com- A corporation or a labor organization may not munications to the general public using the funds use the corporation’s names, trademarks or it has raised, it may sponsor fundraising events service marks to facilitate the making of contri- for candidates and invite outside individuals and butions to a federal political committee, and a political committees. 114.5(i). All related costs federal political committee may not knowingly paid for by the SSF, including staff time, mailing, accept or receive such facilitated contributions. room rental and catering charges, may count as For example, a campaign may not recognize the an-kind contribution to the candidate, depending corporate (or labor) employers of individual on whether the event is coordinated with the contributors in connection with a fundraising candidate or campaign. 109.20(b) and100.52(d). event. These restrictions do not apply to the Note that, as with other uses of corporate/labor use of a name as part of the name of a political facilities, the SSF must pay in advance for any use committee. 114.2(d) and (f). See AO 2007-10. of corporate/labor staff, food service or mailing lists. Additionally, it is advisable that the SSF pay for rooms and equipment in advance to avoid a 10. Fundraisers for Candidates prohibited contribution from the organization. Use of Corporate/Labor Staff, Food Services and Restricted Class Events Mailing Lists for Events Beyond the Restricted Class. Under the exemptions at 114.3(c)(2) permit- A corporation or labor organization may only ting candidate appearances before the restricted allow its food services and mailing lists to be used class (summarized in Section 8 of this chapter), for candidate fundraisers if it receives payment in the corporation or labor organization may allow advance at the fair market value for the goods or a candidate to solicit its restricted class at an services. 114.2(f)(1) and (2). Likewise, a corporation event without the related costs for the event or labor organization may direct its personnel to counting as a contribution. The candidate may work on these fundraisers, so long as employees also collect funds at the appearance. However, are not coerced into providing on-the-job fun- corporate or labor organization staff are pro- draising services if they do not wish to perform hibited from collecting funds for the campaign, them. In all cases, advance payment by a source with a limited exception discussed in the next who may legally make a contribution or expendi- paragraph. 114.2(f) and 114.3(c)(2)(ii) and (iii). ture (such as the campaign or the organization’s SSF) is required in order to avoid a prohibited Collection of Funds contribution by the organization. FEC regula- An exception to the general prohibition on cor- tions specifically require advance payments for: porate or labor organization staff’s collection of funds at a candidate’s fundraising event exists in 49 Chapter 7 • The services of corporate or labor per- and which is not made in coordination with any sonnel directed to carry out candidate candidate or his or her campaign or political party. fundraising activities as part of their job; 100.16, 109.21 and 109.37. Independent expen- • The use of catering or other food ser- ditures are not subject to any limits but may be vices arranged for or provided by the subject to reporting requirements. (The campaign corporation or labor organization; and of a candidate benefiting from an independent expenditure has no reporting obligation.) See Citi- • The use of the organization’s list of clients, zens United v FEC and AOs 2010-11 and 2010-09. customers, vendors or other persons outside the restricted class for purposes of soliciting Appendix D provides detailed information on contributions or distributing invitations. independent expenditures. The appendix may be reproduced and distributed by a campaign to anyone • 114.2(f)(2)(i)(A), (C) and (E). who requests FEC guidelines on independent spend- Note, however, that if a corporation is providing the ing. Campaign staff should pay special attention to services (such as catering or personnel) in its ordi- the section “Coordinated Communications” which nary course of business as a commercial vendor, pay- explains when the independence of an expenditure ment does not have to be made in advance as long is compromised through contact with a campaign as: (1) the payment is at the usual and normal charge; and thus results in an in-kind contribution, subject and (2) the payment schedule conforms to normal to contribution limits, to the campaign. If a corpora- business practice. Otherwise, a prohibited contribu- tion or labor organization funds the coordinated tion results. 100.52(d)(1) and (2); 114.2(f)(1); 116.3; expenditure, it results in a prohibited contribution. see also, for example, AOs 1994-33 and 1991-18. Collection of Funds 12. Electioneering As with restricted-class only events, corporate or labor organization staff may not collect contribu- Communications tions at an event that is coordinated, unless the funds collected are treated not only as contribu- Any broadcast, cable or satellite communica- tions to the candidate, but also as contributions tion that is publicly distributed within 30 days both to and from the SSF of the corporation/ of a primary or 60 days of a general election, labor organization. 114.2(f)(2)(iii) and (4)(iii). refers to a clearly identified federal candidate Alternatively, the campaign may collect the funds. and is targeted to the relevant electorate is an electioneering communication. 100.29(a). Reporting If a registered political committee makes an If the campaign makes the advance payment for electioneering communication, it must report the costs of the event, it must report the cost it as it reports an expenditure or indepen- as a campaign expenditure. If the advance pay- dent expenditure under the Act. 104.20(b). ment is made by any other source, such as the corporation or labor organization’s SSF or an Coordination of Electioneering individual, the campaign must report it as an in-kind contribution received, where the event’s Communications costs are required to be treated as an in-kind If a communication is considered coordinated contribution, as described above. 104.3(a) and (b). under the Commission’s three-part test, it results in an in-kind contribution subject to contribu- tion limitations, source prohibitions and report- 11. Independent Expenditures ing. To avoid receiving an illegal excessive or prohibited contribution, campaigns should avoid An independent expenditure is an expenditure certain interactions with those making elec- for a communication that expressly advocates the tioneering communications. See 109.21(d) and election or defeat of a clearly identified candidate Appendix D, Section 2 for more information. 50 Expenditures and Other Disbursements ChAPTEr 8 Expenditures and Other Uses of Campaign Funds While campaigns have wide discretion in case basis, including meal, travel, vehicle and legal deciding how to spend their funds, the Federal expenses. For example, if a campaign pays for the Election Campaign Act (the Act) places certain candidate’s travel and subsistence in connection restrictions on the use of campaign funds, as with his or her campaign activities, those pay- explained in this section. Note that the use ments are also considered operating expenditures. of campaign funds is also addressed in House Generally, as long as such expenses would not and Senate rules, over which the Commis- exist irrespective of the candidate’s campaign or sion has no jurisdiction (see Appendix G). duties as a federal officeholder, they are considered For reporting purposes, it is important to permissible. See Section 2, “Case-by-Case Deter- understand the term expenditure, because mination of Personal Use,” for more information. expenditures count toward the threshold that Note, however, that if a candidate pays for determines whether an individual is a candidate his or her living expenses with personal under the Act. 100.3(a). An expenditure is a funds, the payments are not considered purchase, payment, distribution, loan, advance, expenditures and are not reportable by the deposit or gift of money or anything of value campaign. 100.153 and 113.1(g)(1)(ii)(C). made to influence a federal election. 100.111(a). Loan Repayments “Disbursement” is a broader term that covers both expenditures and other kinds of payments The repayment of both the principal and the inter- (those not made to influence a federal election). est of a loan owed by the committee are permis- All disbursements are reportable by the campaign. sible expenses. Repayments of the principal are not considered to be a “payment” for the purposes of the definition of expenditure, and thus are itemized separately on the FEC report. 100.111(c). Repay- 1. Permissible Uses of ments of the interest on a loan are considered Campaign Funds operating expenditures for reporting purposes. See Chapter 13, Section 17, “Reporting Loans,” for information on reporting loan repayments. Campaign-Related Expenses Transfers to Other Authorized Committees By definition, the Act allows campaign funds to be used for purposes in connection with Funds may be transferred between authorized the campaign to influence the federal elec- committees of the same candidate (for example, tion of the candidate. 2 USC 439a(a); 113.2. from a previous campaign committee to a cur- rent campaign committee) without limit as long Operating Expenditures as the committee making the transfer has no Payments for day-to-day expenses, such as staff net debts outstanding. 110.3(c) and 116.2(c) salaries, rent, travel, advertising, telephones, (2). See, for example, AO 1987-04. See Chap- office supplies and equipment, fundraising, ter 9, “Transfers,” for more information. etc., are permissible operating expenditures. Alternatively, a candidate may redesignate a Interest paid on a loan is also considered former campaign committee as the principal an operating expenditure. AO 1991-09. campaign committee of his or her current cam- Certain other expenses are considered to be paign and use the excess funds of the previous permissible operating expenditures on a case-by- campaign in the current campaign. AO 1980-30. 51 Chapter 8 See Chapter 13, Section 20, for infor- Non-Campaign Related Expenses mation on reporting transfers. Additionally, campaign funds may be used for Refunds of Contributions the following purposes that are not related to Campaigns may refund any contribution, but the candidate’s campaign for federal office: must refund (or otherwise disgorge) a contri- • To defray the ordinary and neces- bution that is from a prohibited source or in sary expenses incurred in connection excess of the contribution limits. See Chapter with an individual’s duties as of a federal 5, Section 2, “Questionable Contributions,” for officeholder (House and Senate rules more information. For information on reporting may apply; see Appendix G), such as: refunds, see Chapter 13, Section 19, “Report- −Travel expenses for a federal officeholder ing Refunds, Returns and Bounced Checks.” and his or her accompanying spouse and In-Kind Contributions children, provided that the travel is under- taken to participate in a function that is Any in-kind contribution received by a committee directly connected to the officeholder’s bona must be reported as an operating expenditure fide official responsibilities. 113.2(a)(1). See, (even though money has not been expended by for example, AOs 2005-09 and 1997-02; and the committee) in addition to being reported as a contribution received. 104.13(a). This report- −Winding down costs of a federal office- ing adjustment allows the committee to balance holder’s office for a period of six months its cash on hand. For more information, and after leaving office. 113.2(a)(2). See, for an example of reporting in-kind contributions, example, AOs 1996-44 and 1996-14 (House see Chapter 13, “Completing FEC Reports.” and Senate rules may apply; see AOs 2000- 37 and 1996-45; and see Appendix G). Written Agreements to Make Expenditures • Donations to charities (organiza- A written agreement to make an expendi- tions defined in 26 U.S.C. §170(c) of ture, such as a media contract, constitutes the Internal Revenue Code).1 113.2(b). an expenditure. 100.112. For information on See, for example, AO 2005-06; reporting expenditures and debts incurred, • Unlimited transfers to any national, see Chapter 13, “Completing FEC Reports.” state or local party committee. 113.2(c). Ballot Initiative Communications and Donations See, for example, AO 2004-22; Payments for ads in which a candidate endorses a • Donations to state and local candidates, ballot initiative on an issue with which he or she is subject to the provisions of state law. closely associated are expenditures in connection 113.2(d). See 2 U.S.C. §439a(a)(5); and with the campaign. AOs 2006-04 and 2004-29. • Any other lawful purpose, unless A campaign may also support or oppose bal- expressly prohibited by the Act. 113.2(e). lot initiatives and make donations to com- See 2 U.S.C. §439a(a)(6). (Prohibited mittees established to do so under state purposes are summarized below.) election laws. Such donations are considered expenditures under the Act. See AO 2004-29. Special rules apply to a federal candidate 1 Campaign funds may not be converted to personal or officeholder’s fundraising for such orga- use. Commission regulations state that donations nizations, see Appendix E, Section 1. of campaign funds to a charitable organization do not constitute the personal use of campaign funds unless the candidate (former or current) receives compensation from the donee organization before the organization has expended, for purposes unrelated to the candidate’s personal benefit, the entire amount donated by the campaign. 113.1(g)(2). 52 Expenditures and Other Disbursements Contributions to Other Federal Candidates Conversely, any expense that results and Nonfederal Candidates from campaign or officeholder activ- A federal candidate committee may contribute ity falls outside the personal use ban. up to $2,000 per election to the committee EXAMPLE: A candidate may not make tuition of another federal candidate. 102.12(c)(2) and payments with campaign funds, unless the costs 102.13(c)(2). Contributions from federal can- are associated with training campaign staff. didate committees to state or local candidate committees are subject to state law. 300.62. For more information on reporting donations to What is Not Personal Use other candidates, see Chapter 13, Section 14. In addition to the “irrespective test,” Commission regulations include other uses of funds that do not constitute personal use and thus are permis- 2. Prohibited Uses of sible uses of campaign funds. 113.1(g) and 113.2. Campaign Funds Charitable Donations Gifts to charity are not considered personal use Certain Air Travel expenses as long as the candidate does not receive compensation from the charitable organiza- Title VI, section 601 of the Honest Leadership and tion before it has expended the entire amount Open Government Act of 2007 (HLOGA) (Pub. L. donated. Note that the amount donated must No. 81, 121 Stat.735), signed into law on Sep- have been used for purposes that do not person- tember 14, 2007, significantly restricts the use of ally benefit the candidate. 113.1(g)(2). See also campaign funds for air travel by federal candidates AOs 2005-06, 1997-01, 1996-40 and 1994-20. and officeholders.2 In general, expenditures from campaign funds for non-commercial air travel Transfer of Campaign Assets are prohibited unless they are in accordance The sale or transfer of a campaign asset (see with 100.93. 113.5. See Chapter 10, Section 4, Chapter 14, “Winding Down the Campaign”) to “Campaign Travel” for further information. either the candidate or a third party does not constitute personal use as long as the transaction Personal Use of Campaign Funds is made at the fair market value. 113.1(g)(3). Using campaign funds for personal use is pro- hibited. 2 USC 439a(b)(1) and 113.2(e). Com- Gifts mission regulations provide a test, called the On special occasions, campaign funds may be “irrespective test,” to differentiate legitimate used to purchase gifts or make donations of campaign and officeholder expenses from per- nominal value to persons other than the mem- sonal expenses. Under the “irrespective test,” bers of the candidate’s family. 113.1(g)(4). personal use is any use of funds in a campaign account of a candidate (or former candidate) Candidate Salary to fulfill a commitment, obligation or expense The candidate may receive a salary from of any person that would exist irrespective of his or her campaign committee only the candidate’s campaign or responsibilities as a under the following conditions: federal officeholder. 113.1(g). More simply, if the expense would exist even in the absence of the • The salary must be paid by the prin- candidacy or even if the officeholder were not cipal campaign committee; in office, then the personal use ban applies. • The salary must not exceed the lesser of the minimum annual salary for the federal 2 The provisions of HLOGA also apply to nonconnected committees (known as “leadership PACs”) sponsored office sought or what the candidate received by candidates for the House of Representatives. as earned income in the previous year; 53 Chapter 8 • Individuals who elect to receive a salary campaign worker whose death arises out of, or in from their campaign committees must the course of, campaign activity. 113.1(g)(1)(i)(B). provide income tax records and additional proof of earnings from relevant years Clothing upon request from the Commission; The campaign cannot pay for attire for political • Payments of salary from the commit- functions (for example, a new tuxedo or dress), tee must be made on a pro-rata basis but it can pay for clothing of de minimis value that (i.e., a candidate may not receive a whole is used in the campaign, such as T-shirts or caps year’s salary if he or she is not a candidate imprinted with a campaign slogan. 113.1(g)(1)(i)(C). for an entire twelve-month period); Tuition Payments • Incumbent federal officehold- The campaign may pay for tuition costs that are ers may not receive a salary pay- for training campaign staff to perform campaign ment from campaign funds; and tasks. Also, in AO 1997-11, the Commission • The first payment of salary shall be made no allowed a federal officeholder to use campaign sooner than the filing deadline for access to funds to cover her costs for a Spanish immer- the primary election ballot in the state in sion class that she took to better communicate which the candidate is running for office. with her constituents. 113.1(g)(1)(i)(D). • Salary payments may continue until the date Mortgage, Rent and Utility Payments when the candidate is no longer considered The campaign may not pay for mortgage, rent or a candidate for office or until the date of the utilities for the personal residence of the candidate general election or general election runoff. or the candidate’s family even if part of the resi- For special elections, payments may continue dence is being used by the campaign. 113.1(g)(1) from the date that the special election is (i)(E). However, the Commission has allowed the set until the date of the special election. use of campaign funds to pay for home security 113.1(g)(1)(i)(I). enhancements made in response to threats to an officeholder’s safety. In these cases, the security Automatic Personal Use upgrades were not considered personal use because the threats would not exist irrespec- The regulations list some expenses that are tive of the officeholders’ candidacy or duties as automatically considered to be personal an officeholder. AOs 2011-05 and 2009-08. use. Based on these rules, the following paragraphs discuss what kinds of expenses In addition, the campaign may pay for long the campaign can and cannot pay for. distance calls made for campaign pur- poses from the candidate’s residence or Household Food Items and Supplies the residence of his or her family. The candidate cannot use campaign funds to pay EXAMPLE: A campaign committee may not rent for food purchased for daily consumption inside space in the candidate’s home, but it may rent the home or supplies needed to maintain the part of an office building owned or leased by the household. The campaign may, however, pay for candidate for use in his or her campaign, as long food and supplies for fundraising activities and as it pays no more than the fair market value for campaign meetings (even when they take place the space. AO 1995-08. See also AO 2000-02. in the candidate’s home). 113.1(g)(1)(i)(A). Investment Expenses Funeral, Cremation and Burial Expenses The campaign may not pay for investment Campaign funds cannot be used to cover expenses expenses such as acquiring securities on related to deaths within the candidate’s family. margin unless all of the investment and its They may, however, be used to cover funeral, proceeds are used for the purpose of influenc- cremation and burial expenses for a candidate or ing the candidate’s election for federal office 54 Expenditures and Other Disbursements or for one of the permissible non-campaign Case-by-Case Determination uses of funds discussed above in Section 1. of Personal Use Entertainment For other expenses not mentioned above, the The campaign may not pay for admission to Commission will determine, on a case-by-case sporting events, concerts, theater and other basis, whether the expense is one that would forms of entertainment. Campaign funds may be exist irrespective of the candidate’s campaign used, however, if the entertainment is part of a or duties as a federal officeholder and would specific officeholder or campaign activity. They be considered a personal use expense. For may not be used for a leisure outing at which example, the Commission addresses payments the discussion occasionally focuses on the cam- for meals, travel, vehicles, mixed-use and legal paign or official functions.3 113.1(g)(1)(i)(F). expenses on a case-by-case basis. 113.1(g)(1)(ii). Dues, Fees and Gratuities Meal Expenses Campaign funds may not be used to pay for dues Campaign funds may be used to pay for meals to country clubs, health clubs, recreational facili- during face-to-face fundraising events. By contrast, ties or other nonpolitical organizations unless the a candidate may not use campaign funds to take payments are made in connection with a specific his or her family out to dinner. 113.1(g)(1)(ii)(B). fundraising event that takes place on the organiza- Travel Expenses tion’s premises. See, for example, AO 1995-26. Campaign funds may be used to pay the costs of Campaign funds may be used for member- travel to activity that is related to the campaign ship dues in an organization that may have or to a candidate’s duties as a federal officeholder. political interests. 113.1(g)(1)(i)(G). (Note, however, that 2007 changes to the statute EXAMPLE: A candidate or officeholder may use mandate specific conveyances and payments. See campaign funds to pay for a membership in a “Certain Air Travel” above and Chapter 10, Sec- civic or community group in his or her district tion 4 for more information.) Thus, the costs of in order to maintain political contacts with travel for a candidate (and the candidate’s spouse constituents or the business community.4 and minor children) may be used to pay for travel to functions directly related to the campaign or Salary Payments to Candidate’s Family those directly connected to the individual’s official Campaign funds may be used to make salary pay- responsibilities as a federal officeholder. 113.2(a) ments to members of the candidate’s family only if: (1); see AO 2005-09. The regulations, however, prohibit the use of campaign funds for personal • The family member is providing a bona expenses collateral to travel—either campaign or fide service to the campaign; and officeholder—unless personal funds are used to • The payments reflect the fair market reimburse the committee. 113.1(g)(1)(ii)(C). See, value of those services. 113.1(g)(1)(i)(H). for example, AOs 2002-05, 2000-37 and 1996-19. See also AOs 2001-10 and 1992-04. See also “Mixed Use” below for trips that involve both official/campaign and personal travel. Any salary payments to family members in excess of the fair market value constitute personal use. Vehicle Expenses 3 From the Explanation and Justification for Campaign funds may be used to pay for a vehicle the final rules, 60 Fed. Reg. 7866, February 9, that is used for campaign-related purposes, assum- 1995 (online at http://www.fec.gov/law/cfr/ej_ ing that the costs related to the personal use of compilation/1995/1995-05_Personal_Use.pdf#page=6). the vehicle are de minimis. AO 2001-03. Campaign 4 From the Explanation and Justification for funds cannot be used to pay for expenses relat- the final rules, 60 Fed. Reg. 7867, February 9, 1995 (online at http://www.fec.gov/law/cfr/ej_ ing to the personal use of a campaign vehicle compilation/1995/1995-05_Personal_Use.pdf#page=7). unless those expenses are de minimis, that is, 55 Chapter 8 unless they are insignificant in relation to the date or officeholder (AOs 2009-12, overall vehicle use. 113.1(g)(1)(ii)(D). See also 2005-11, 1998-01 and 1997-12); “Mixed Use” below for vehicle use that involves • Investigations by the House or Sen- both official/campaign and personal travel. ate pertaining to any activity conducted Mixed Use by the candidate/officeholder (AOs 2009-12, 2008-07 and 1998-01); In the event of travel or vehicle expenses that commingle personal and campaign or officeholder • Responding to press inquiries pertaining to any activity, the beneficiary of the personal use of the above (AOs 2009-12, 2008-07, 2006-35, expenses must reimburse the committee within 2005-11, 2001-09, 1998-01 and 1997-12); and thirty days for the entire amount associated with • Suits involving former and current staff the personal activities (the amount over and above members of the candidate/officeholder, which what the cost would have been had the trip/vehicle relate to the candidate’s campaign and duties use been solely for campaign/officeholder-related as a federal officeholder (AO 2009-20). purposes). The reimbursement does not constitute a contribution. See, for example, AOs 1992-12 and Relating to Other Activity 1984-59. The committee must maintain logs of the In specific situations the Commission has con- expenses to help the Commission determine on a cluded that campaign funds may be used to pay case-by-case basis what portion was for personal for up to 50 percent of legal expenses that do use rather than for campaign-related activity or not relate directly to allegations arising from officeholder duties. 113.1(g)(8). AO 2001-03. campaign or officeholder activity (e.g. activity Legal Expenses prior to becoming a candidate or officeholder Using the irrespective test summarized above, or activity of a business owned by the candidate/ the Commission decides on a case-by-case basis officeholder) if the candidate or officeholder is whether legal expenses are considered “personal required to provide substantive responses to the use” and thus are expenses that a candidate may press regarding the allegations of wrongdoing. See, not pay for using campaign funds. 113.1(g)(1)(ii)(A). for example, AOs 2005-11, 1998-01 and 1997-12. Relating to Campaign or Officeholder Activity Salary, Compensation and Other In several advisory opinions the Commission has said that campaign funds may be used to pay Payments Paid On Behalf of Candidates for up to 100 percent of legal expenses related General Rule to campaign or officeholder activity, where such Generally, when a third party (not the can- expenses would not have occurred had the individual not been a candidate or officeholder. didate or the candidate’s committee) pays for personal use expenses, the third party makes a contribution, subject to the restric- EXAMPLES: tions and limitations of the Act. 113.1(g)(6). • Suits where the candidate/officeholder was the plaintiff, provided he derived no financial Exceptions benefit from court awards (AO 1997-27); No contribution will result, however, if the pay- • Suits where the candidate/officeholder ment would have been made irrespective of was the defendant and the litigation the candidacy. For example, a third party may arose directly from campaign activity make the following payments on behalf of a or the candidate’s status as a candidate candidate without making a contribution: (AOs 2009-10, 2003-17 and 1995-23); • Payments to a legal expense trust fund • Investigations pertaining to the can- established under House and Sen- didate/officeholder’s role as a candi- ate rules (see 113.1(g)(6)(i)); 56 Expenditures and Other Disbursements • Payments for personal living expenses made from funds that are the candidate’s personal funds, including an account the candidate holds jointly with a family member (See 100.153, and 113.1(g)(6)(ii)); and • Payments that began prior to candidacy. For example, if the candidate’s parents had been making college tuition payments for the candi- date’s children, the parents could continue to do so during the campaign without making a contribution. See 100.153 and 113.1(g)(6)(iii). Salary or Compensation Paid to Candidate Compensation paid to a candidate by a third party as a continuation of payments made prior to can- didacy (for example, payments of salary) are not considered contributions as long as such payments: • Result from bona fide employment independent of the candidacy; • Are exclusively in consideration of the services provided as part of this employment; and • Represent pay not in excess of that nor- mally received for such services. 113.1(g)(6) (iii). See also AOs 2006-13 and 2004-17. Promotion of Candidate’s Books Generally, the expense of marketing a book would exist irrespective of a candidate’s campaign, and thus a campaign cannot ordinarily use its funds to pay such an expense. In limited situations, however, the Commission has permitted the use of campaign funds to promote a candidate’s book, as follows: • A campaign could incur de minimis costs to post on its website material promot- ing the book’s release and linking to an online bookseller. AO 2006-07. • A campaign could incur costs for planning book-related events and handling press and public inquiries where the candidate donates royalties to charitable organizations and thus does not personally gain from the use of cam- paign assets to promote the book. AO 2006-18. See also AO 2008-17, where the Commission ruled that payments to a co-author by the principal cam- paign committee would constitute personal use. 57 Chapter 8 58 Transfers ChAPTEr 9 Transfers This chapter describes the different types of net debts outstanding. 110.3(c)(4) and 116.2(c) transfers that authorized committees may receive (2). Note that, for the purposes of the contribu- and make. Transfers of funds and assets between tion limits, contributions transferred from the federal committees authorized or established previous campaign to the current campaign must by the same candidate are generally unlimited be aggregated with contributions by the same because the committees are considered affiliated contributors to the current campaign only if the committees. Note, however, that an authorized transferred contributions were originally made: committee of a federal candidate may not accept • After the previous election was held; or any transfers of funds or assets from a com- mittee established by the same candidate for • After the candidate withdrew or a nonfederal election. See Section 3, below. otherwise ceased to be a candi- date in the previous election.1 110.3(c)(4)(iii) and (iv). 1. Transfers Between See Chapter 4, Section 5, for information Candidate’s Committees on how to determine the date when a con- tribution is made. Other rules also apply to for Same Office contributions that a committee receives after an election; see Chapter 4, Section 4, “Desig- nated and Undesignated Contributions.” In the Same Election Funds and assets may be transferred without limit between a candidate’s principal campaign 2. Transfers Between committee and the candidate’s other authorized committees for the same office during the same Committees of election. Note, however, that an authorized Candidate Seeking More committee may not transfer funds to another Than One Office authorized committee of the same candidate if the transferring committee has net debts outstanding. 110.3(a)(1)(i) and 116.2(c)(2). In the Same Election Cycle When an individual seeks election to more than Between Primary and General Election one federal office during the same election cycle Campaign in Same Election Cycle or overlapping election cycles, he or she must Funds that went unused in the primary election establish separate principal campaign committees may be transferred without limit to a candi- and must maintain completely separate campaign date’s general election campaign. 110.3(c)(3). organizations. 110.8(d)(1). Contributors also 1 An individual ceases to be a candidate in an election as In Different Elections of the earlier of the following dates: the date on which the candidate publicly announces that he or she will Funds and assets may be transferred without limit no longer be a candidate in that election for that office between committees authorized by a candidate and ceases to conduct campaign activities with respect for the same office in different elections as long to that election; or the date on which the candidate is or becomes ineligible for nomination or election as the transferring committee does not have to that office by operation of law. 110.3(c)(4)(iv). 59 Chapter 9 have separate limits with respect to the separate Guidelines for Transfers When No Longer campaigns of the same candidate. Special transfer “Actively Seeking” Multiple Offices rules apply to transfers between these commit- Once a candidate is no longer “actively seek- tees. The situations to which these rules apply ing” election to more than one federal office, can be illustrated with the following examples: transfers between the two campaigns are • Candidate A runs for both the House permissible, within the following guidelines: and the Presidency in the 2012 primary • The transferor committee’s available funds election (as permitted by state law). should be viewed as those contributions • Candidate B begins the 2012 election cycle most recently received that add up to the as a House candidate, but later begins a amount of the transfer from cash on hand. campaign for a Senate seat in 2012. • The transferor committee must be able to Prohibited While “Actively Seeking” demonstrate that such cash on hand contains More Than One Office sufficient funds at the time of the transfer that comply with the limitations and prohibitions No transfers of funds or assets may be made of the Act to cover the amount transferred. between a candidate’s separate campaign committees while the candidate is “actively • Contributions transferred must be aggregated seeking” more than one office at the same with any contributions made by the same time. 110.3(c)(5) and 110.8(d)(2). In the above contributor to the committee receiving the examples, Candidate A would be prohibited transfer. Amounts that would cause a con- from transferring funds because he was “actively tributor to exceed his or her per-election seeking” two offices at the same time. contribution limit must be excluded from the transfer, i.e., the funds available for trans- Additional rules prohibit any transfers to or from fer would be reduced by such amounts. a campaign account of a Presidential candidate who has accepted public financing, regardless of 110.3(c)(5)(ii). the timing or amount of the transfer. 110.3(c) By taking these steps, Candidate B in the above (5)(iii). This restriction would apply to Candi- example could transfer funds between her two date A (above) if he received public funds for campaigns once she was no longer “actively his Presidential campaign. See AO 1995-03. seeking” two offices at the same time. Note that the recipient committee will need to iden- Definition of No Longer “Actively Seeking” tify the contributors whose contributions are Under FEC rules, a candidate is no longer included in the transfer by using memo entries. “actively seeking” nomination or election to a particular office once he or she: In Different Election Cycles • Becomes ineligible for nomination or elec- When an individual seeks different offices in differ- tion to that office by operation of law; ent election cycles, surplus funds from the earlier • Publicly announces that he or she is campaign that remain after the general election withdrawing from one race and ceases may be transferred to the later campaign without to campaign for that election, other than aggregating the contributions of the original fundraising to retire outstanding debts; contributor to the two committees. 110.3(c)(4). • Has filed a termination report (see Chapter 14, EXAMPLE: Candidate X runs for the House in Section 1, “Terminating the Committee”); or 2012, and for the Senate in 2016. Any surplus • Has notified the Commission in writ- funds for the 2012 House campaign that remain ing that his or her campaign will conduct after the 2012 general election may be transferred no further activities with respect to that to the 2016 Senate campaign. The 2016 Senate election, other than fundraising to retire Committee would not have to disclose those outstanding debts. 110.3(c)(5)(i). 60 Transfers contributors whose contributions to the 2012 Note that these transactions must not House Committee were included in the transfer. be reported as transfers. For informa- tion on reporting, see Chapter 13. 3. Transfers from Candidate’s Nonfederal Committee Are Prohibited A candidate’s authorized (federal) committee may not accept funds or assets transferred from a committee established by the same candidate for a nonfederal election campaign. At its option, how- ever, a nonfederal committee of the same candidate may refund its leftover funds to its contributors and may coordinate arrangements with the federal campaign for a solicitation of those same persons. The full cost of this solicitation must be paid by the federal committee. 110.3(d). See also AO 1996-33. 4. Transfers of Joint Fundraising receipts Transfers of receipts raised in compliance with joint fundraising procedures are unlimited. 102.6(a) (1)(iii) and 110.3(c)(2). A committee receiving such a transfer must not only report the total amount transferred but must also itemize, as necessary, its share of gross proceeds as contribu- tions from the original contributors. 102.17(c)(8) (i)(B). For more information, see Appendix C. 5. What is NOT a Transfer Note that, while each of the above sections discusses transfers between committees, not all receipts or disbursements to other committees are transfers. The following are not transfers: • Contributions to or from other can- didates (federal or nonfederal); • Contributions to or from PACs; and • Contributions from party committees, although an authorized committee may make unlimited transfers to party committees. 113.2(c). 61 Chapter 9 62 Conducting the Campaign ChAPTEr 10 Conducting the Campaign This chapter outlines the rules that apply to a special notice on their solicitations to inform three areas of campaign activity: fundraising, solicitees that contributions are not tax deduct- advertising and travel. It also details the rules ible. There are substantial penalties for failure that apply to disclaimer notices for com- to comply with this provision. Contact the IRS munications by an authorized committee. for more information (see Appendix G, Sec- tion 4, “Tax Laws,” for contact information). Fundraising on the Internet 1. Fundraising Campaign committees may solicit contributions over the Internet as long as the solicitation: Fundraising Notices • Includes the proper disclaimers (see “Dis- claimer Notices,” later in this chapter); Certain statements by the campaign must be present on solicitations, as follows: • Requests confirmation that the contribu- tion is not from a prohibited source; and Authorization Notice • Requests contributor information. When a campaign solicits contributions through 104.7(b)(1), 110.11. See Chapter 11, Sec- public communications, or on a campaign web- tion 5, “Treasurer’s Best Efforts” and site, it must include a clear and conspicuous AOs 1999-36, 1999-22 and 1999-9. notice on the solicitation stating that it was authorized and paid for by the campaign: Paid Joint Fundraising for by the Sam Jones for Congress Committee. Campaigns may engage in joint fundraising with 110.11(a)(1) and (b)(2). See “Disclaimer Notices” other committees. 102.17. For the rules that later in this chapter for more information. govern this special activity, see Appendix C. “Best Efforts” Rules When making solicitations, committees and their Transmitting Contributions treasurers must make “best efforts” to obtain, Forwarding Contributions maintain and report the name, address, occupa- Every person who receives contributions for a tion and employer of each contributor who gives campaign must forward them to the treasurer more than $200 in an election cycle. In order of the candidate’s authorized committee within to show that the committee has made “best 10 days of receipt. The date of receipt is the efforts,” solicitations must specifically request date the person acting as a conduit obtains that information and inform contributors that possession of a contribution. 102.8(a). See also the committee is required by law to use its best Appendix A, “Earmarked Contributions.” efforts to collect and report it. This request must be clear and conspicuous. 104.7(a). For details, see Forwarding Records Chapter 11, Section 5, “Treasurer’s Best Efforts.” A person receiving contributions for a campaign IRS Notice Requirements must also forward the following recordkeep- ing information along with the contributions: Section 6113 of the Internal Revenue Code requires political committees whose gross annual receipts normally exceed $100,000 to include 63 Chapter 10 • For contributions exceeding $50, the See also AO 1982-38. amount, date of receipt and the con- When itemizing such a contribution in its report, tributor’s name and address. a campaign should note that the contribution con- • For contributions exceeding $200, the tains only federally permissible funds. Contributions complete identification of the contributor from such unregistered organizations are subject (full name and mailing address, occupa- to the $2,500 per election limit.1 110.1(b). These tion and employer) as well as the amount organizations should be aware, however, that mak- and date of receipt of the contribution. ing contributions to federal campaigns and political 102.8(a). committees may trigger their own registration as a federal political committee. State political action No Commingling committees sponsored by corporations, labor Campaign receipts must not be commingled with organizations or trade associations, in particular, personal funds of any individual, such as by deposit- must register as federal separate segregated funds ing contributions in a personal account. 102.15. within 10 days of the decision to make a contribu- tion to a federal candidate. Additional requirements regarding their solicitations also apply. See 100.5(b) Accepting Contributions and 102.2(c); see also AOs 2003-29, 1985-18 General Rule and 1982-40.2 Contributions by other types of unregistered organizations (for example, local A campaign is prohibited from knowingly accept- party organizations or committees not sponsored ing any contributions from prohibited sources.2 by an incorporated entity or labor organiza- U.S.C. 441a(f).The treasurer of a political com- tion) count against a $1,000 per year aggregate mittee is responsible for examining all contri- registration threshold. See 100.5(a) and (c). butions to make sure they are not illegal (i.e., prohibited or excessive). See “Questionable Contributions,” Chapter 5, Section 2. 103.3(b). Depositing Funds Within 10 days of receiving a contribution Contributions from Unregistered Organizations (or any receipt of money), the treasurer must When campaigns accept contributions from deposit it in the campaign depository. 103.3(a). groups that are not political committees registered See Chapter 5, Section 2, “Questionable with the Federal Election Commission (such as Contributions,” for information on deposit- state PACs, unregistered local party commit- ing or returning questionable contributions. tees or nonfederal campaigns), they must make sure that the funds are permissible under the Accounting for Primary and Federal Election Campaign Act (the Act). This is an important consideration because campaign laws General Election Contributions in some states permit nonfederal political groups If, before the primary election, a campaign to accept funds that would violate the limits and receives contributions designated for the general prohibitions of the Act. To avoid a possible viola- election, it must use an acceptable account- tion of the Act, a campaign must be certain that ing method to distinguish between primary an unregistered group making a contribution: contributions and general election contribu- • Can demonstrate through a reasonable accounting method that it has sufficient 1 As noted in Chapter 4, Section 1, this limit is indexed federally acceptable funds to cover the for inflation and adjusted in odd-numbered years. amount of the contribution or expen- 2 Authorized committees may want to refer state diture at the time it is made; or political action committees of corporations, labor organizations and trade associations to these citations. • Has established a separate account containing Such committees are best advised to register a federal only funds permissible under the Act. 102.5(b). separate segregated fund with the FEC before soliciting or making any contributions on the federal level. 64 Conducting the Campaign tions. Commission regulations suggest two Wording of Disclaimer Notice accounting methods that are acceptable: Authorized and Financed by Campaign • Maintaining separate accounts If the campaign authorizes and finances a cov- for each election; or ered communication (including any solicitation), • Maintaining separate books and the notice must state that the communica- records for each election. tion was paid for by the authorized commit- tee. Additional requirements (see below) 102.9(e). apply for print, television and radio ads. Example:“Paid for by the Sam Jones for Congress Committee.” 110.11(b)(1). 2. Disclaimers Authorized but Not Financed by Campaign Any public communication made by a political If a covered communication, including any committee, even those that do not contain a solicitation, is authorized by the campaign but solicitation or express advocacy, must include paid for by another person, the communica- a disclaimer. 2 U.S.C. 441d(a); 110.11(a). tion must identify the person who paid for it and state that it was authorized by the campaign. Additional requirements apply for Public Communications print, television and radio ads (see below). Public communications include electioneering Example:“Paid for by the XYZ Commit- communications and any other form of general tee and authorized by the Sam Jones for public political advertisement, including com- Congress Committee.” 110.11(b)(2). munications made using the following media: Not Authorized or Financed by Campaign • Broadcast, cable or satellite; Although this type of notice is not used by a • Newspaper or magazine; candidate’s campaign, campaign staff should be • Outdoor advertising facility; aware that if a committee (including a party com- mittee that makes an independent expenditure) • Mass mailing (more than 500 substan- pays for a communication (including any solicita- tially similar mailings within 30 days); tion) that refers to their candidate but is not authorized by the campaign, the notice must state • Phone bank (more than 500 substan- that it was not authorized by any candidate or tially similar calls within 30 days); and candidate’s committee, identify the entity that • Communications placed for a fee paid for the communication and provide at least on another person’s website. one of the following: the payor’s permanent street address, telephone number, or website address.3 100.26, 100.27 and 100.28. Additional requirements apply for print, televi- The following communications are not sion and radio ads (see Appendix D, Section 7). considered to be public communica- Example:“Paid for by the XYZ PAC (www. tions, but still require a disclaimer: xyzpac.org) and not authorized by any candi- date or candidate’s committee.” This type of • Electronic mail: More than 500 sub- notice must be used on independent expen- stantially similar communications sent by a political committee; and 3 When persons outside the campaign use public communications to solicit contributions, the solicitation • Web sites of political committees. must carry a notice stating who paid for the solicitation and whether or not it was authorized by the 110.11(a). candidate or the committee. 110.11(a)(3) and (b). 65 Chapter 10 ditures and electioneering communications Multiple-Paged Document that are not authorized by a candidate or a A disclaimer need not appear on the candidate’s campaign. 110.11(b)(3) and (d)(3). front page or cover of a multiple- paged document. 110.11(c)(2)(iv). Party Committee Coordinated Communications on Behalf of Candidate Package of Materials A party committee that pays for a communica- Each communication that would require a tion that is a coordinated party expenditure disclaimer if distributed separately must still must identify the party committee as the payor display the disclaimer when included in a pack- in the disclaimer. Prior to the date the party’s age of materials. 110.11(c)(2)(v). For example, if a campaign poster is mailed with a solicitation candidate is nominated, it is sufficient for the for contributions, a separate disclaimer must party committee to state who has paid for the appear on the solicitation and the poster. communication. Subsequent to the nomina- tion, the disclaimer must state that it was paid for by the party committee and authorized Special Rules for Television by the candidate. 110.11(d)(1) and (2). and Radio Ads Preemption of State Law Authorized by Candidate’s Committee – the “Stand by Your Ad” Provision An authorization notice does not have to comply In addition to the requirements noted under with state or local law if the communication “Wording of Disclaimer Notice” above, radio and is made only with respect to federal elections. television communications that are authorized or 108.7(b). See also, for example, AO 1986-11. paid for by a campaign require additional language. However, state or local laws governing the For such radio and television ads, the candidate placement or location of signs on roads are not must deliver an audio statement identifying superseded by federal law. See AO 1981-27. himself or herself and stating that he or she has approved of the communication.4 For example: Clear and Conspicuous Placement “I am [candidate’s name], a candidate for [federal office sought], and I approved this advertisement.” of Disclaimer Notice In a television ad, the disclaimer A disclaimer notice must be clearly and conspicu- must be conveyed by: ously displayed. A notice is not clearly and conspic- • A full-screen view of the candi- uously displayed if the print is difficult to read or if date making the statement; or the placement is easily overlooked. 110.11(c)(1). • A voiceover with an image of the can- Special Rules for Printed Communications didate occupying no less than 80% of the vertical screen height. In printed communications, the disclaimer must be contained within a printed box set apart from the 110.11(c)(3). See also AO 2007-33. contents of the communication. The print of the Additionally, television communications must disclaimer must be of sufficient size to be “clearly contain a clearly readable written statement readable” by the recipient of the communication, of approval, similar to what is spoken, that and the print must have a reasonable degree of appears at the end of the communication for a color contrast between the background and the period of at least four seconds with a reason- printed statement. 110.11(c)(2)(ii) and (iii). Black 4 Under the Communications Act, administered text in 12-point font on a white background is one by the Federal Communications Commission, candidates must also identify the office they are way to satisfy this requirement for printed material seeking in order to be entitled to the lowest unit measuring no more than 24 inches by 36 inches. charge. See 47 USC §315(b) and AO 2004-43. 66 Conducting the Campaign able degree of color contrast between the 4. Campaign Travel background and the disclaimer statement (e.g., black text on white background). The written This section explores rules for travel payments. statement must occupy at least four percent of Generally, campaigns may pay for campaign-related the vertical picture height. 110.11(c)(3)(iii). travel as operating expenditures. As explained in Chapter 7, “Sources of Support,” an in-kind Not Authorized by Candidate’s Committee contribution generally results from the source of payment for the travel unless an exemption A radio or television communication that is not for individual travel applies or the campaign authorized by the candidate’s committee must also pays for its own campaign travel. 100.93. See include (in addition to the statements identifying Chapter 7, Section 4, “Travel Cost Exemptions,” who paid for the communication and that it is for details on when payments for campaign not authorized by any candidate or candidate’s travel by individuals are considered exempt. committee) an audio statement that “(the name of the person or committee responsible for the Commercial Transportation communication) is responsible for the content If a campaign uses an aircraft that is operated of this advertising” and, if applicable, the name for commercial air service, such as a commercial of the committee’s connected organization. For airline or charter service, or another means of details on the specific requirements for such commercial transportation, the campaign must notices, see Appendix D, Section 7. 110.11(c)(4). pay the usual and normal charge for that service to avoid receiving an in-kind contribution from the service provider. See 100.52(a) and (d). When Disclaimer Not Required A disclaimer is not required when: Non-Commercial Air Travel • It cannot be conveniently printed (e.g., The Honest Leadership and Open Government Act pens, bumper stickers, campaign pins, cam- of 2007 (HLOGA) (Pub. L. No. 110-81, 121 Stat. paign buttons and similar small items); 735) amended the Act to restrict campaign-related travel on non-commercial aircraft. Under HLOGA, • Its display is not practicable (e.g., wearing candidates for the U.S. House of Representatives, apparel, water towers and skywriting); or their authorized committees, and their leadership PACs are prohibited from making any expenditure • The item is of minimal value, does not contain for non-commercial air travel, with an exception a political message and is used for adminis- for travel on government aircraft and on aircraft trative purposes (e.g., checks and receipts). owned or leased by the candidate or an immedi- 110.11(f); See also AOs 2004-10 and 2002-09. ate family member of the candidate. 2 U.S.C. 439a(c)(2) and (3). HLOGA also specified new reimbursement rates that Senate, Presidential and 3. rates for Political Vice-Presidential candidates and their authorized committees must pay when making expenditures Advertisements for flights aboard non-commercial aircraft.5 Rules governing the use of non-commercial aircraft Rates charged by newspapers and magazines for by “campaign travelers” are described below. campaign advertising must be comparable to HLOGA defines the term “campaign traveler” as those charged for noncampaign advertisements. any individual traveling in connection with an elec- 110.11(g). Rates charged for radio and televi- 5 The provisions of HLOGA also apply to nonconnected sion advertisements are regulated by the Federal committees sponsored by candidates for the Communications Commission. See Appendix G. House of Representatives (“leadership PACs”). 67 Chapter 10 tion for federal office on behalf of a candidate or • The lowest unrestricted and non-discounted political committee, and candidates who travel on coach airfare in the case of travel between behalf of their own campaigns. The term campaign a city served by regularly scheduled coach traveler also includes any member of the news commercial airline service, but not regularly media traveling with a candidate. Candidates are scheduled first-class commercial airline service, only considered campaign travelers when they and a city served by regularly scheduled coach are traveling in connection with an election for commercial airline service (with or without federal office. This term does not include Members first-class commercial airline service); or of Congress when they engage in personal travel • The normal and usual charter fare or or any other travel that is not in connection with rental charge for a comparable commercial an election for federal office. 100.93(a)(3)(i). aircraft of sufficient size to accommodate Presidential, Vice-Presidential and all campaign travelers and security person- Senate Candidate Travel nel, if applicable, in the case of travel to or Candidates for President,Vice-President and the from a city not regularly served by regularly Senate pay the pro rata share of the fair market scheduled commercial airline service. value on non-commercial flights. 100.93(c)(1). The To avoid the receipt of an in-kind contribution, pro rata share is determined by dividing the fair the committee must reimburse the service market value of the normal and usual charter fare provider no later than seven calendar days or rental charge for a comparable aircraft of com- after the date the flight began. 100.93(c)(3). parable size by the number of campaign travelers flying on behalf of each candidate on the flight.6 Travel on behalf of House Candidates The pro rata share is calculated based on the num- and House Leadership PACs ber of candidates represented on a flight, regard- House candidates, individuals traveling on behalf of less of whether the individual candidate is actually House candidates, their authorized committees, or present on the flight. A candidate is represented the leadership PACs of House candidates are gen- on a flight if a person is traveling on behalf of that erally prohibited from engaging in non-commercial candidate or the candidate’s authorized committee. campaign travel on aircraft.7 100.93(c)(2). This Travel on behalf of Leadership PACs prohibition cannot be avoided by payments to of Senate, Presidential and Vice- the service provider, even if the payments derive Presidential and Senate Candidates from the personal funds of a House candidate. For non-commercial travel on behalf of Travel on behalf of Other Committees leadership PACs of Senate, Presidential and The reimbursement rate structure for campaign Vice-Presidential candidates, the reimburse- travelers who are traveling on behalf of politi- ment for that travel is the responsibility of the cal party committees, separate segregated funds committee on whose behalf the travel occurs. (SSFs), nonconnected committees and certain The reimbursement rates are as follows: leadership PACs is the same reimbursement • The lowest unrestricted and non-discounted rate structure described above under “Travel first-class airfare in the case of travel on behalf of Leadership PACs of Senate, Presi- between cities served by regularly scheduled dential and Vice-Presidential Candidates.” first-class commercial airline service; 7 This prohibition does not apply when the travel would 6 The term “comparable aircraft” means an aircraft be considered an expenditure by someone other of similar make and model as the aircraft that than the House candidate, the House candidate’s actually makes the trip, with similar amenities as authorized committee or the House candidate’s that aircraft. The Commission’s new regulations leadership PAC (for example, if the House candidate interpret HLOGA to include helicopters when were traveling on behalf of a Senate candidate determining “comparable aircraft.” 100.93(a)(3)(vi). instead of on behalf of his or her own campaign). 68 Conducting the Campaign Aircraft Owned or Leased by Candidate burse the pro rata share per campaign traveler of or Immediate Family the costs associated with the trip.8 100.93(g)(1)(iii). Expenditures are allowed for travel aboard aircraft Repayment must be made by the candidate’s that are “owned or leased” by a candidate or a committee in accordance with the normal candidate’s immediate family, including an aircraft business practices of the entity administering owned or leased by any entity in which the can- the shared-ownership or lease agreements. didate or a member of the candidate’s immediate Other Non-Commercial Transportation family has an ownership interest provided that 1) the entity is not a public corporation, and 2) the For non-commercial travel via other means, such use of the aircraft is not more than the candidate’s as limousines and all other automobiles, trains and buses, a political committee must pay the service or immediate family member’s proportionate provider the normal and usual fare or rental share of ownership allows.100.93(g). However, if charge for a comparable commercial conveyance the candidate seeks to avoid receiving an in-kind of sufficient size to accommodate all campaign contribution from the service provider (can- travelers, including members of the news media didates, members of their immediate family or traveling with a candidate and security personnel, entities in which either owns an interest) for the if applicable. Payment for the travel must be made candidate’s use of the aircraft, the candidate must 30 days from the receipt of the invoice, but no reimburse the service provider. Although federal more than 60 days following the date the travel candidates may make unlimited contributions commenced. 100.93(d). The campaign must keep in to their campaigns, such contributions must be its records an itinerary showing the departure and reported by their authorized committees. 110.10. arrival cities and the dates of departure and arrival; Contributions from all other persons, including a list of all passengers on such trip, along with a family members, are subject to the applicable list of which passengers are and are not campaign travelers or security personnel; and the commercial amount limits and source prohibitions. 110.1. fare or rental charge available for a comparable In instances where the candidate uses the aircraft conveyance of sufficient size. 100.93(i)(3). within the limits of a shared-ownership arrange- ment, the candidate’s committee must reimburse Government Conveyances the candidate, the candidate’s immediate family Candidates and representatives of political commit- member or the administrator of the aircraft for the tees may make campaign travel via governmental applicable rate charged to the candidate, immedi- conveyances, such as government aircraft, subject ate family member, or corporation or other entity to specific reimbursement requirements. Can- through which the aircraft is ultimately available to didates, their authorized committees or House candidate leadership PACs must reimburse the the candidate. This amount is treated as a personal federal, state or local government entity providing contribution from the candidate if the candidate the aircraft at either of the two following rates: is the owner or lessee. House candidates are prohibited from exceeding the candidate’s propor- • “Per candidate campaign traveler” reimburse- tional share of ownership interest in the aircraft. ment rate, which is the normal and usual charter fare or rental charge for a comparable For Senate, Presidential and Vice-Presidential aircraft of sufficient size to accommodate all candidates, the reimbursement rate would be of the campaign travelers. The pro rata share based upon the pro rata share of the charter rate is calculated by dividing the normal and usual where the proportional share of the ownership charter fare or rental charge by the number interest is exceeded. 100.93(g) and 100.93(c)(1). of campaign travelers on the flight that are In instances where a candidate or a candidate’s 8 Such costs include, but are not limited to, the cost of immediate family member wholly owns the aircraft, fuel and crew and a proportionate share of annual the candidate’s authorized committee must reim- and recurring maintenance costs. 100.93(g)(1)(iii). 69 Chapter 10 traveling on behalf of candidates, authorized Mixed Travel committees or House candidate leadership PACs, including members of the news media, When a candidate makes a trip involving both and security personnel. No portion of the campaign and noncampaign stops, only the travel costs related to the campaign are expenditures. normal and usual charter fare or rental charge If, however, a candidate conducts any campaign may be attributed to any other passengers, activity at a given stop, that stop is considered except for members of the news media and campaign related, unless the campaign activ- government-provided security personnel, as ity is merely incidental. In no case, however, provided in 100.93(b)(3). 100.93(e)(1)(i); or may campaign funds be used for non-travel • “Private traveler reimbursement rate,” as spec- expenses that are not related to official or ified by the governmental entity providing the campaign-related activity. See AO 2002-05. aircraft, per campaign traveler. 100.93(e)(1)(ii). Example: If a candidate makes a noncampaign For campaign travelers who are traveling on speech at a civic association luncheon and, on government aircraft, but are not traveling with the way out, chats with a few attendees about or on behalf of a candidate or candidate’s com- his campaign in response to their questions, the mittee, the reimbursement must be equal either conversation does not convert the appearance into to the lowest unrestricted and non-discounted a campaign-related event. On the other hand, if a first-class commercial airline service that is candidate flew into a city for a trip that involved geographically closest to the military airbase both personal vacation days and days spent cam- or other location actually used, or, for all other paigning, an incremental approach to paying for travel, the applicable rate from among the the trip would be required, to avoid the campaign rates specified in 100.93(c)(3). 100.93(e)(2). paying the lodging, subsistence and sightseeing Members of the news media who are traveling expenses on the vacation days — an expense that with a candidate on government aircraft and would be considered an impermissible personal use security personnel not provided by a govern- of campaign funds. Because of the non-incidental ment entity must be included in the number nature of the campaign days, the airfare would of campaign travelers for the purposes for be considered a campaign-related expense. identifying a comparable aircraft of sufficient Expenditures for campaign-related stops are size to accommodate all campaign travelers. calculated on an actual cost-per-mile basis, starting at the point of origin of the trip, includ- A political committee must reimburse the ing each campaign-related stop, and ending governmental entity providing the convey- at the point of origin. 106.3(b)(2) and (3). ance within the time frame specified by the governmental entity. 100.93(e)(1). As explained in Chapter 8, campaign funds may be used for mixed use travel; however, the committee must be reimbursed within Reporting and Recording Travel Costs thirty days for the entire amount associated Payments for campaign-related travel are generally with the personal activities (the amount over reported as operating expenditures when they and above what the cost would have been had are paid with campaign funds or by an individual the trip/vehicle use been solely for campaign/ from personal funds. 106.3(a) and (b)(1). Special officeholder-related purposes). 113.1(g)(1)(ii)(C). rules apply, however, when the candidate or Individuals other than candidates must allocate another individual uses his or her personal funds their mixed campaign and noncampaign travel to pay for travel expenses and is later reim- expenses on a reasonable basis. 106.3(c)(1). bursed. See Chapter 13 for more information. Example: A candidate travels by plane from Refer to 100.93(j) for the recordkeeping Philadelphia to Las Vegas for a campaign speech. requirements for travel on non-commercial While in Nevada, the candidate travels by plane aircraft and travel by other conveyances. from Las Vegas to Reno for a personal trip. The can- 70 Conducting the Campaign didate then flies back to Philadelphia from Reno. To determine the candidate’s campaign-related travel expenses, the committee must create a fictional itinerary from Philadelphia to Las Vegas and back. Thus the campaign would derive the cost-per-mile of campaign travel from the commercial rate for a round-trip flight from Philadelphia to Las Vegas, and the candidate must reimburse the committee for the difference in costs between the fictional trip and the actual trip. See the explanation and justifi- cation for 113.1 at 60 FR 7869 (February 9, 1995). On February 6, 2002, the Commission adopted an interpretive rule to clarify that the travel allocation and reporting requirements of 11 CFR 106.3(b) do not apply to the extent that a candidate9 pays for certain travel expenses using funds authorized and appropriated by the federal government. 67 FR 5445 (February 6, 2002). Candidates should consult with the House Com- mittee on Standards of Official Conduct or the Senate Select Committee on Ethics regarding the use of appropriated funds for travel expenses. Travel to and from Washington, DC Costs for travel between Washington, DC, and the state or Congressional District in which an individual is a candidate are not reportable unless paid for by the campaign (or another political committee) in connection with campaign-related travel. 106.3(d). Consult the House and Senate rules for further guidance; see Appendix G. 9 This interpretive rule does not apply to Presidential or Vice-Presidential campaigns that are covered by the Presidential Campaign Fund Act.26 U.S.C. §9001 et seq. 71 Chapter 10 72 Keeping Records ChAPTEr 11 Keeping Records In order to comply fully with the reporting require- $50 (amount, date of receipt and con- ments of the Federal Election Campaign Act (the tributor’s name and address); or Act), a committee must keep detailed records. The • In the case of small contributions collected recordkeeping requirements for a committee’s at a fundraiser (such as gate receipts, cash receipts and disbursements are explained below. contributions), keep records of the name of the event, the date and the total amount of contributions received on each day of 1. record retention the event. AOs 1981-48 and 1980-99. • These amounts are reported under Treasurers of authorized committees (and the category “unitemized contributions other political committees) are responsible for from individuals” (see Chapter 13). keeping copies of each statement and report, together with original back-up records, for Contributions Exceeding $50 three years after the report or statement Records must identify each contribu- is filed. 102.9(c); 104.14(b)(2) and (3). tion of more than $50 by: • Amount; 2. recording receipts • Date of receipt; and • Contributor’s name and address. With respect to receipts, the Act requires that 102.9(a)(1). records be kept for contributions and disburse- ments. 2 U.S.C. 432(c)-(d). The treasurer of a Furthermore, political committees must maintain political committee shall keep these records and either a full-size photocopy or digital image of each copies of all reports filed for three years after check or written instrument by which a contribu- the report is filed. 2 U.S.C. 432(d); 104.14(b). tion of more than $50 is made. 102.9(a)(4). Contributions Aggregating Over $200 Total Contributions For each contribution that exceeds $200, either Records must show figures for total by itself or when added to the contributor’s previ- contributions received using any accept- ous contributions made during the same calendar able accounting method. 102.9(a). year, records must identify that contribution by: • Amount; Identifying Contributors • Date of receipt; and Contributions of $50 or Less • Contributor’s full name and address, In advisory opinions, the Commission has occupation and employer. recommended two possible accounting If a person has already contributed an aggregate methods that satisfy recordkeeping require- amount of over $200 during a calendar year, each ments for contributions of $50 or less: subsequent contribution, regardless of amount, • Keep the same information required for must be identified in the same way. 102.9(a)(2). identifying contributions that exceed Please note that contributions to authorized com- mittees are aggregated on a calendar-year basis 73 Chapter 11 for recordkeeping purposes, but are aggregated Acceptable Accounting Method on a per-election basis for purposes of monitoring If a committee receives contributions desig- contribution limits, and on an election-cycle basis nated for use in the general election, prior for reporting purposes. See 102.9(a)(2), 104.3(a)(4), to the primary election, then the committee 110.1(b) and 110.2(b) and Chapter 4 of this Guide. must use an acceptable accounting method to Designated, Redesignated and distinguish between contributions received for Reattributed Contributions the primary election and contributions received for the general election. Acceptable accounting A committee must retain the written cop- methods include: designating separate accounts ies of contributors’ designations, redesigna- for each election, or establishing separate books tions and reattributions. 102.9(f). Also, for any and records for each election. 102.9(e)(1). contributions presumptively redesignated or reattributed, the committee must retain any The committee’s records must demonstrate writings from contributors that accompany that, prior to the primary election, recorded the contribution and any notices sent from the cash on hand was at all times greater than or committee to the contributor. 110.1(l)(4)(ii). equal to the sum of general election contri- butions received minus the sum of general Contributions from Political Committees election disbursements made. 102.9(e)(2). Records must identify each contribution from a political committee, regardless of amount, by: Date of Receipt • Amount; General Rule • Date of receipt; and A contribution’s date of receipt is the date • Name and address of the politi- on which the person receiving the contribu- cal committee. 102.9(a)(3). tion on behalf of the committee obtains possession of it. 102.8(a). That is the date Possibly Illegal Contributions used for recordkeeping and reporting. As noted in earlier chapters, when a committee The date of receipt may be earlier than the date has reason to question the legality of a contri- the committee treasurer receives the money, bution, it has specific time frames in which to since a person collecting contributions (other clarify whether the contribution is permissible. than an authorized agent) has 10 days (or 30 While investigating a contribution, the committee days for contributions of $50 or less) in which must keep a written record noting the basis of to forward them to the treasurer. 102.8(a). concern for each deposited contribution which: • Requires a written redesignation and/or reat- Contributions Charged on Credit Cards tribution from the contributor (see Chapter When the committee receives contributions 4). (For presumptive redesignations and through credit card charges, the date of receipt reattributions, see “Designated, Redesignated is the date on which the committee receives and Reattributed Contributions” above.); or the contributor’s signed authorization to charge • Requires confirmation that it is not from the contribution. The treasurer should retain a a prohibited source (see Chapter 5). copy of the authorization form in the commit- tee’s records. See AOs 1995-09 and 1990-04. 103.3(b)(1) and (5). See Chapter 5, Section 2, “Questionable In-Kind Contributions Contributions,” for more information on the The date of receipt for an in-kind contribu- committee’s responsibility to determine the tion is the date the goods or services are legality of possibly illegal contributions. provided to the committee, even if the con- tributor pays the bill for the goods or services after they are provided. See 110.1(b)(6). 74 Keeping Records (For information on how to determine the value of • Purpose (a brief but specific description an in-kind contribution, see Chapter 3, Section 2.) of why the disbursement was made, such as “dinner expense” or “postage”).2 Deposit of Receipts 102.9(b)(1). Once the treasurer (or authorized agent) Disbursements Exceeding $200 receives a contribution or other receipt, he For each single disbursement that exceeds or she must deposit it within 10 days. Con- $200, the committee must keep a receipt, tributions not deposited within 10 days must invoice or canceled check (in addition to be returned to their donors. 103.3(a) the information above). 102.9(b)(2). Advances for Travel and Subsistence 3. recording Disbursements When a committee advances $500 or less to the candidate, staff members or volunteers for travel expenses—including transportation, food Check and Cash Disbursements and lodging—the committee must retain: Disbursements must be made by check or similar • The expense voucher or other expense account documentation; and draft drawn on an account maintained at the committee’s designated depository. 102.10 and • The canceled check made out to the individual receiving the payment. 103.3(a); See also AOs 1993-04 and 1982-25. 102.9(b)(2)(i)(B). However, the committee may maintain a petty cash fund for small disbursements. A written When a committee advances more than $500 for travel and subsistence expenses, record of petty cash disbursements must be kept the committee must obtain and retain: if a petty cash fund is maintained. Payments from • A receipt (or invoice) from the per- petty cash to one person for any one purchase son providing goods or services in or transaction may not exceed $100. 102.11. excess of $200 per transaction to the Regardless of whether a disbursement is made person requesting the advance; by check or from a petty cash fund, the required • A cancelled check from the person request- recordkeeping information must be maintained. ing the advance showing payment to the person providing goods or service; or Recording Disbursements • A monthly credit card billing statement or customer receipt from the person request- All Disbursements ing the advance, and that person’s cancelled check showing payment of such bill. The committee must keep a record of each disbursement, including: AO 1984-08. • Amount; Credit Card Transactions • Date; For credit card transactions, the • Name and address of payee;1 and committee must retain: 1 Except in the case of travel advances of $500 or 2 A list of acceptable/unacceptable descriptions of less, the payee is the person providing the goods “purpose” was published in a Policy Statement at 75 or services to the committee. In the case of such FR 887 (January 9, 2007). This notice and an updated travel advances, the payee is the person receiving list of unacceptable “purpose” statements are available the advance. 102.9(b)(2)(i)(A) and AO 1984-08. online at http://www.fec.gov/law/policy.shtml#purpose. 75 Chapter 11 • A monthly billing statement; or 104.7(a). The criteria for making “best efforts” • The customer receipt for each transaction; and vary, depending on the type of transaction. • The canceled check used to pay the credit card account. Contributor Information If an individual who has contributed more than 102.9(b)(2)(ii). $200 during the election cycle fails to provide the required recordkeeping information (i.e., name, Credit Union Checks or Share Drafts mailing address, occupation and employer), the Carbon copies of share drafts or checks drawn committee must be able to show that it made on credit union accounts may be used as records, “best efforts” to obtain, maintain and report that provided the monthly account statement (show- information. To demonstrate “best efforts,” the ing that the draft or check was paid by the committee must be able to show that it requested credit union) is also retained. 102.9(b)(2)(iii). the information—first, in the solicitation materi- als that prompted the contribution and, second, if the information is not obtained, in a follow-up Best Efforts to Document request. 104.7(b)(1) and (2). Furthermore, if Disbursements the requested information is not received until If a treasurer fails to receive a receipt, invoice after the contribution has been reported, the or canceled check (required for disbursements committee must report the information using exceeding $200), he or she can demonstrate one of the procedures described under “File his or her best efforts to obtain the informa- Amendments if Necessary,” below. 104.7(b)(4). tion by making at least one written effort Solicitation Materials3 per transaction to obtain a duplicate copy of the needed documentation. 102.9(d). To satisfy the “best efforts” standard, the solicitation must include a statement explain- ing that the campaign is required to use its best efforts to obtain and report certain 4. recording Debts and Loans information from the contributor. This state- ment is referred to as the “best efforts” Although the Act does not contain specific notification; two examples are listed below: recordkeeping requirements for debts and loans owed by (or to) the campaign, commit- • “Federal law requires us to use our best tees are required to keep detailed records of efforts to collect and report the name, transactions required to be disclosed on the mailing address, occupation and name of employer of individuals whose contribu- committee’s FEC reports. See 104.14(b). tions exceed $200 in an election cycle;” or • “To comply with Federal law, we must use our 5. Treasurer’s Best Efforts best efforts to obtain, maintain and submit the name, mailing address, occupation and name Committees and their treasurers must make best of employer of individuals whose contribu- tions exceed $200 per election cycle.” efforts to obtain and maintain (and ultimately report) the information required by law with 104.7(b)(1)(i)(B) respect to itemized receipts and disbursements. 3 Any contribution which is reported by a committee When reporting information is incomplete, the with all required contributor information will meet committee and the treasurer will be in compliance the reporting requirements, whether or not the with the law if they can demonstrate that they committee asked for the information or used the language specified under “Solicitation Materials.” See used “best efforts” in trying to obtain, maintain the Explanation and Justification published with the final and report the needed information. 102.9(d) and rule, 58 Fed. Reg. 57725, 57727 (October 27, 1993). 76 Keeping Records The request for the information and the best File Amendments If Necessary efforts notification must be clear and con- If requested information about a contribution spicuous. If the committee solicitations include is received after the contribution has been dis- response materials, the best efforts notice and closed on a report, the committee must either: the request for the contributor information must • File a Schedule A with its next regularly be placed on these materials. The notice will not scheduled report, containing memo entries be considered to be “clear and conspicuous” if: listing all contributions for which new con- tributor information has been received; or • The notification is printed in smaller type than the solicitation and response materials; • File amendments to the original reports. • The printing is difficult to read; or In either case, the entries must cross-reference the prior reports to which they relate. However, • The notification is placed where it can the committee is only required to submit the be easily overlooked. 104.7(b)(1). information for contributions received during the current two-year election cycle. 104.7(b)(4) Follow-Up Request Within 30 Days (ii). See Chapter 13, Section 26, “Filing Amend- If the contributor does not provide sufficient ments,” for instructions on filing amendments. reporting information when making a contribution, the committee must make at least one request for the information after the contribution is received. This follow-up request must be made for any solicited or unsolicited contribution that exceeds the $200 threshold and lacks the neces- sary information (see “Contributions Aggregat- ing over $200” in Section 2 of this chapter). The request must be made within 30 days of receipt of the contribution; it may not include an additional solicitation or material on any other sub- ject, but it may thank the contributor. The follow-up request may be made orally or in writing, but a written request must be accompanied by a pre- addressed postcard or envelope for the response. Oral requests must be documented in a memoran- dum. 104.7(b)(2). A political committee may also use e-mail to request missing contributor informa- tion. AOs 1999-17 and 1995-09. Committees must retain records of follow-up requests. 102.9(d). Use of Information from Prior Records If the contributor does not respond to the follow-up request, but the committee possesses the information in its contributor records, fundraising records or prior reports filed dur- ing the same two-year election cycle, then the committee must use that information when disclosing the contribution. 104.7(b)(3). 77 Chapter 11 78 Filing Reports ChAPTEr 12 Filing Reports 1. Who reports certification, or a signed certification on paper along with the CD or diskette (For specific instructions on how to file electronically using Principal Campaign Committee a CD or diskette, see the Electronic Filing section of the FEC website at http://www. The principal campaign committee must file fec.gov/support/faq_filing.shtml#EFQ18). periodic reports on financial activity until the committee has retired any debts,1 filed a 104.18(g). termination report and received notification For more information on electronic fil- from the FEC that the committee’s termina- ing, see Section 5 in this chapter. tion report has been accepted (see Chapter 14, Section 1). 102.3(b) and 104.1(a). Other Authorized Committees Treasurer’s Duties Only principal campaign committees file reports and statements with the appropriate federal A committee treasurer is responsible for signing offices. Other authorized committees of the and filing timely, complete and accurate reports and candidate file with the principal campaign com- statements. 104.14(d). See Chapter 2, Section 4 for mittee, as explained in Section 2, below. a complete summary of the treasurer’s duties. Trea- surers are considered in compliance with the Fed- eral Election Campaign Act (the Act) when they have Candidate Does Not Report made their “best efforts” to obtain, maintain and Campaign Activity report required information. (See Section 3, “When Apart from filing a Statement of Candidacy (FEC to Report,” later in this chapter and Section 5, Form 2), a candidate has no personal reporting “Treasurer’s Best Efforts,” in Chapter 11.) If a trea- obligation under the Act. If a candidate receives surer is unable to obtain information after making contributions, obtains loans for campaign activity or his or her best efforts, that fact should be noted on makes disbursements, he or she is acting as a cam- the report where the information is incomplete. paign agent. The transactions are reported by the When filing electronically, a committee treasurer principal campaign committee. 101.2 and 102.7(d). must verify that all electronically filed documents have been examined by the treasurer and (to the best of that person’s knowledge) are accurate Candidate Must File Personal and complete. In order to verify electronically Financial Reports filed documents, the treasurer must either: Under the Ethics in Government Act, candidates for • Obtain a personal password (which serves federal office must file personal financial reports. as the treasurer’s electronic signature) House candidates file such reports with the Clerk from the FEC (available through the elec- of the House of Representatives and Senate tronic filing office at 202/694-1307); or candidates file those reports with the Secretary of the Senate. Candidates for President and Vice • File on a CD or 3.5” diskette and include, as President (except the incumbent President and a separate file, a digitized copy of a signed Vice President) file their personal financial dis- 1 Neither the committee seeking to terminate nor any closure forms with the FEC, and the Commission other authorized committee of the same candidate is the agency responsible for public disclosure may have any outstanding debts or obligations. 102.3 of those forms. However, detailed review and 79 Chapter 12 approval of those forms is the responsibility of the Office of Government Ethics. See Appendix G. 3. When to report Committee treasurers must file reports on time (the Commission cannot grant extensions). Gen- 2. Where to File reports eral rules on when to file reports are outlined below. The FEC sends more detailed information to treasurers by e-mail shortly before reports are Filing with the Federal Government due. (For this reason, it is especially important • Principal campaign committees of House and to list a current e-mail address on the commit- Presidential candidates file reports and state- tee’s FEC Form 1 (Statement of Organization).) ments with the Federal Election Commission, Additionally, the Record, the FEC’s monthly newslet- 999 E Street, NW, Washington, DC 20463. ter, publishes reporting announcements, as does 105.1 and 105.3. (Note that committees in the FEC’s website, http://www.fec.gov/info/filing. Guam, Northern Mariana Islands and Puerto shtml. This section summarizes filing requirements Rico also have state filing requirements.2) applicable to all authorized committees of House • Principal campaign committees of Sen- and Senate campaigns. Presidential committees ate candidates file reports and statements file reports according to a different schedule than with the Secretary of the Senate. 105.2. the one presented in this section. See 104.5(b). When filing a document with the Secretary of the Quarterly Reports Senate, it is not necessary to send a copy to the Once an individual has become a candidate, his FEC. The Secretary automatically makes copies of or her principal campaign committee (and other all filings and forwards them to the FEC for review. authorized committees) must file quarterly reports. 104.5(a). Quarterly reports cover activ- Filing with the Principal ity through the end of the calendar quarter and Campaign Committee are due on April 15, July 15 and October 15. The fourth quarterly report—called the year-end Authorized committees of a campaign other report—is due on January 31 of the following than the principal campaign committee submit year (additional reports are required during the their reports and statements to the principal candidate’s election year; see below). All authorized campaign committee. The principal campaign committees must file quarterly reports, even if committee, in turn, files these reports and state- the candidate decides to retire, withdraws from ments, along with its own, with the appropriate the race prior to the primary election, loses the federal and state offices. When filing reports of primary or drops out of the race prior to the receipts and disbursements (FEC Form 3), the general election. See 2 U.S.C. §434(a)(2). Com- principal campaign committee must also file mittees must continue to file quarterly reports a consolidated report (FEC Form 3Z), which until the Commission notifies them in writing summarizes information included in its own that their termination report has been accepted. report and those filed by other authorized com- mittees. 102.1(b) and 104.3(f). Note that only The Commission may waive a quarterly report authorized committees of the current campaign if a pre-election report (see below) is due need to be included in the consolidated report. during the period beginning on the 5th day and ending on the 15th day after the close 2 Copies of reports for House and Senate candidates of the calendar quarter. 104.5(a)(1)(iii). running for federal office in Guam, Northern Mariana Islands or Puerto Rico must be filed with the appropriate office in those territories. Presidential Election Year Reporting committees must file a copy of each report in Guam, Northern Mariana Islands or Puerto Rico if the Election years are years in which regu- campaign makes an expenditure in those territories larly scheduled federal elections are during the reporting period. 105.3 and 108.2. held (even-numbered years). 80 Filing Reports Pre-Election Reports running in the general election include this form In addition to quarterly reports, a com- with the year-end report following the election). mittee must file pre-election reports: Last-Minute Contributions (48-Hour Notice) • A pre-primary report must be filed before the election in which the Campaign committees must file special notices candidate seeks nomination.3 regarding contributions of $1,000 or more received less than 20 days but more than 48 • A pre-general election report must be filed if the candidate runs in the general election. hours before 12:01 a.m. of the day of any elec- tion in which the candidate is running. (These • A pre-runoff report must be filed are often called “48-Hour Notices.”) This rule when a candidate is involved in a run- off election (Note: this may be either applies to all types of contributions to any autho- a primary or a general election). rized committee of the candidate, including: A pre-election report is due 12 days before the • Contributions from the candidate; election and covers activity through the 20th day • Loans from the candidate and before the election.4 If sent by registered or certi- other non-bank sources; and fied mail, priority mail with a delivery confirmation, express mail with a delivery confirmation, or • Endorsements or guarantees of loans overnight delivery service with an online tracking from banks. (See Chapter 3, Section 2.) system, the report must be postmarked no later Committees filing electronically must file than the 15th day before the election. 104.5(a)(2)(i). their 48-hour notices electronically. See Authorized committees must file appropri- Section 5, “Electronic Filing” below. ate pre- and post-election reports even if the candidate is unopposed or if the Paper-filing committees may file their 48-hour election is not held. AO 1986-21. notices using FEC Form 6. Alternatively, a paper-filing committee may file online using Post-General Election Reports the FEC’s web-based forms (http://www.fec. There is no requirement for post-primary reports, gov/elecfil/online.shtml), or may use its own but a committee must file a post-general elec- paper or stationery for the notice, provided tion report if the candidate runs in the general that it contains the following information: election. A post-general election report covers activity through the 20th day after the election • The candidate’s name and the office sought; and is due 30 days after the election. 104.5(a)(2) • The identification of the contributor; and (ii). Committees filing the post-general report • The amount and date of receipt must include the Post-Election Detailed Sum- mary Page. See Chapter 13, Section 24, for more of the contribution. information. (Committees of campaigns not Committees filing paper forms may fax the 3 Note that in those states in which the party notice to the appropriate office using the fol- caucus or convention has authority to select lowing numbers: FEC, 202/219-0174; Secretary a nominee (Virginia) or has authority to select of the Senate, 202/224-1851. The committee a nominee and is held in addition to a primary (Connecticut and Utah), pre-election reports should keep fax receipts of all transmissions. must be filed for the caucus or convention. See “Party Caucus or Convention” in Chapter 4. The FEC or the Secretary of the Senate must 4 In AO 2000-29, the Commission determined receive the notice within 48 hours of the commit- that the last day to qualify for a position on tee’s receipt of the contribution. The committee the general election ballot in Louisiana must be considered the primary election date for must itemize all last-minute contributions in the Louisiana candidates. See 11 CFR 100.2(c)(4)(i). committee’s next scheduled report. 104.5(f). 81 Chapter 12 Special Elections By Diskette or CD Filing dates for special elections are published While most electronic filers find it more conve- nient to file through the Internet, the Commis- on the FEC’s website, in the FEC Record and in sion also accepts properly-formatted electronic the Federal Register. The Commission also notifies reports on compact discs (CDs) or 3.5” 1.44 MB the principal campaign committees of candidates diskettes (either hand delivered or sent by other who are on the ballot in a special election. delivery means, such as the U.S. Postal Service). It If a regularly scheduled report is due is important to note that all mail sent to the FEC within 10 days of the date a special elec- through the U.S. Postal Service undergoes special tion report is due, the Commission may processing which might damage the information on waive the regular report. 104.5(h). a CD or diskette. For specific instructions on how to file electronically using a CD or diskette, see the Electronic Filing section of the FEC website at Meeting the Filing Deadline http://www.fec.gov/support/faq_filing.shtml#EFQ18. By Registered Mail, Certified Mail, Priority Mail Mandatory Electronic Filing with Delivery Confirmation, Express Mail with Some committees must file electronically (See Delivery Confirmation or Overnight Delivery Section 5, “Electronic Filing”). If a committee If a statement or report is sent by registered required to file electronically files a paper report mail, certified mail or overnight mail with an instead of an electronic report, the report will online tracking system,5 it is considered filed be considered not filed. The committee may on the date of the U.S. postmark. (Note the be subject to the Commission’s enforcement special rule for pre-election reports, above.) process for nonfilers and may have its name 100.19. The committee should retain evidence published as a nonfiler. See 104.18(a)(2). that it delivered the report to the U.S. Postal Service or the overnight delivery service, in the event of a delivery failure. See 111.35(b)(1). 4. Administrative Fines for By First Class Mail Late Filers and Nonfilers If a statement or report is sent by first class mail, The Administrative Fines Program, which is it is considered filed on the date it is received based on amendments to the Federal Elec- by the Secretary of the Senate or the Federal tion Campaign Act,6 assesses civil money Election Commission. 100.19(b)(2) and 104.5(e). penalties for violations involving: The risk of timely delivery is on the filer. • Failure to file reports on time; By Electronic Filing • Failure to file reports at all; and An electronic report is considered “filed” when • Failure to file 48-hour notices. it is received and validated by the Commission’s If the Commission finds “reason to believe” computer system on or before 11:59 p.m. (Eastern (RTB) that a committee violated the law, the Time) on the filing date. Incomplete or inaccurate Commission will notify the committee in writing reports that do not pass the FEC’s validation of its finding and the amount of the civil money program will not be considered filed. The Com- penalty. 111.32. The committee will have 40 days mission will notify the filer that the report has 6 Public Law 106-58, 106th Cong., Section 640, 113 not been accepted. 100.19(c) and 104.18(e)(2). Stat. 430, 476-77 (1999); Commission authority extended in Public Law No. 106-67, 107th Cong., 5 Overnight mail is often used to refer to priority Section 642, 115 Stat 514, 555 (2001), again in Public mail having a delivery confirmation, express mail Law No. 108-199, 108th Cong., Section 639, 118 having a delivery confirmation, or an overnight Stat 3 (2004) and again in Public Law No. 109-115, delivery service with an on-line tracking system. Section 721, 119 Stat 2396, 2493-2494 (2006). 82 Filing Reports Reporting Deadlines Report Type Covering Due January 1 — March 31 April 15 Quarterly July 15 April 1 — June 30 July 1 — September 30 October 15 October 1 — December 31 January 31 Pre-Election First day of the current report- 12 days before the election (Both Pre-Primary and Pre- ing period through the 20th day General as well as Pre-Runoff, if before the election appropriate) Post-General First day of the current report- 30 days after the general ing period through the 20th day election after the general election 48 Hour Notices Contributions received less Within 48 hours of receipt of (Reporting contributions of than 20 days but more than contribution $1,000 or more) 48 hours before the election to either pay the civil money penalty or submit control, and they filed the late report within a written challenge to the Commission action. If 24 hours after those circumstances ended the committee challenges the finding, it will be (also called the “best efforts” defense). reviewed by an independent reviewing officer Excuses involving negligence, illness, inexperience, who was not involved in the RTB finding. After unavailability of committee staff or treasurer, failure the Commission considers the reviewing officer’s to know filing dates, failure to use Commission recommendation and the committee’s response, software properly, delays caused by vendors or if any, the Commission will determine whether failure of the committee’s computers, software the committee violated 2 U.S.C. §434(a) and, if or Internet service provider do not qualify for so, will assess a civil money penalty based on the the “best efforts” defense. 111.35(c) and (d).8 schedules of penalties. The committee will then have 30 days to pay the penalty or seek court review of the case.7 See 111.34 and 111.35. 5. Electronic Filing Respondents must demonstrate one of the following situations in their challenge: Campaign committees of House and Presidential • The RTB filing is based on factual errors; candidates must file all reports and statements • The RTB civil money penalty is electronically if their total contributions or improperly calculated; or total expenditures exceed, or are expected to exceed, $50,000 in a calendar year. The require- • They could not file due to reasonably ment to file electronically does not apply to unforeseen circumstances beyond their Senate candidate committees (or other com- mittees that support only Senate candidates), 7 For more information on the Administrative Fine Program, see 11 CFR 111.30 to 111.45, Subpart B, and the Commission’s website 8 These rules are effective as of April 30, 2007. at http://www.fec.gov/af/af.shtml. See 72 Fed. Reg. 14662 (March 29, 2007). 83 Chapter 12 who are required to file their reports on - Refunds of Contributions paper with the Secretary of the Senate.9 = Total Contributions Any committees that are required to file elec- or tronically, but that file on paper or fail to file, may be subject to enforcement action as nonfilers. Total Operating Expenditures 104.18(a)(2). See the previous section, “Admin- + Contributions Made istrative Fines for Late Filers and Nonfilers.” = Total Expenditures Because electronic filing is more efficient and cost effective than paper filing, even House and Have Reason to Expect to Exceed the Threshold Presidential committees that do not meet the Once committees actually exceed the $50,000 threshold requirement are encouraged $50,000 yearly threshold they have “reason to voluntarily file their reports electronically. to expect to exceed” the threshold in the Please note, however, that voluntary electronic following two calendar years. 104.18(a)(3) filers must continue to file electronically for (i). Consequently, committees must continue the remainder of the calendar year unless the to file electronically for the next two calen- Commission determines that extraordinary dar years (January through December). and unforeseeable circumstances make contin- ued electronic filing impractical. 104.18(b). Exception A campaign committee that met or exceeded Methods of Electronic Filing the $50,000 threshold and began filing elec- Most committees filing electronically find it con- tronically is not required to file electronically venient to do so via an Internet connection with a for the following two calendar years if it meets password. Committees may, however, submit their all three of the following requirements: electronic reports on compact discs (CDs) or • Has $50,000 or less in net debts outstanding 3.5” 1.44 MB diskettes (either hand delivered or on January 1 of the year following an election; sent by other means such as U.S. Postal Service). Electronic filers must file all their reports, notices, • Anticipates terminating prior to designations and statements electronically, and the next election year; and the reports must adhere to the FEC’s Electronic • Supports a candidate who has not qualified Filing Specifications Requirements.10 104.18(d). for the next election and does not intend to become a candidate in the next election. Calculating the Threshold 104.18(a)(3)(i). Committees should use the follow- Note that such committees must finish fil- ing formulas to determine whether their ing electronically for the calendar year in total expenditures or total contributions which they exceeded the threshold. are over $50,000 per calendar year: Committees With No History Total Contributions Received11 New committees with no history of cam- paign finance activity on which to base their 9 Senate candidates are encouraged to voluntarily file electronically an unofficial copy of their reports with expectations have reason to expect to the FEC (in addition to their official paper copy with the exceed the $50,000 yearly threshold if: Secretary of the Senate) to ensure faster disclosure. The committee receives contributions 10 Available online at http://www.fec.gov/elecfil/ or makes expenditures that exceed one- vendors.shtml or on paper from the FEC. quarter of the threshold amount in the first 11 Including the outstanding balance of any loans made, guaranteed or endorsed by calendar quarter of the calendar year (i.e., the candidate or other person. exceeds $12,500 by the end of March); or 84 Filing Reports The committee receives contributions or makes may not be processed in time for a committee expenditures that exceed one-half of the thresh- to use the password to file a timely report. old amount in the first half of the calendar year Note: For the initial Form 1 the treasurer (i.e., exceeds $25,000 by the end of June). can get a password by faxing or mailing a 104.18(a)(3)(ii). signed statement which contains the sentence “I represent that I am the duly appointed Verification Requirements treasurer and have authority as such to sign FEC reports for the above committee.” The political committee’s treasurer must verify the electronically filed reports by submitting either: Assigning the Password • A signed, written certification along Once the password office receives the letter with the diskette or CD; or requesting a password, it will verify that the • A digitized copy of the signed certification requester is listed as the treasurer (and assistant as a separate file in an electronic (i.e., not treasurer, if applicable) of that committee on transmitted by diskette or CD) submission. that committee’s Statement of Organization (FEC Form 1). Only the committee’s treasurer The signed verification must certify that the and assistant treasurer can receive a password. treasurer or assistant treasurer has exam- ined the submitted report, and that, to the If the requester is listed on the Statement of best of his or her knowledge, the report is Organization, then a representative from the pass- true, correct and complete. 104.18(g). word office will call the requester and ask him or her to choose a password. This password will be Obtaining a Password assigned immediately. Passwords are case sensitive and must be entered exactly as initially assigned. Requesting a Password Lost or Forgotten Password A committee’s treasurer or assistant treasurer can obtain a password by faxing a request let- The Commission cannot provide a trea- ter to the password office at 202/219-0674. surer’s password to a treasurer or committee Requests may also be mailed to the Federal if a treasurer forgets or loses the password Election Commission, 999 E Street NW, Wash- because the passwords are encrypted. Instead, ington, DC 20463. A password request must: the treasurer must ask for a new password, repeating the process described above. • Include the committee’s name and nine- digit FEC identification number; New Treasurers and New E-filers • Be signed by the treasurer and also by the In some cases, a committee may have a new assistant treasurer if the assistant treasurer treasurer who has been neither assigned a pass- is the individual requesting the password; word nor has a signature on file and, due to the • Include the treasurer’s phone number requirement that all filing information be submitted and, if applicable, the phone number electronically, cannot amend the Statement of of the assistant treasurer; and Organization to indicate the change of position. Under these circumstances, the new treasurer • Be printed on the committee’s letterhead must submit a password request letter which con- (if the committee has official letterhead). tains the sentence “I represent that I am the duly A sample request can be viewed on the FEC’s web- appointed treasurer and have authority as such site at http://www.fec.gov/elecfil/passwords.shtml. to sign FEC reports for the above committee.” Requests sent by fax can usually be processed Once a password is received, an amended Form within a few hours. However, committees are 1 must be filed to indicate the change of position. encouraged to request a password as early as Treasurers of committees e-filing for the first possible. Requests received near a filing deadline time must also submit a password request letter. 85 Chapter 12 Special Requirements of a campaign staff member) for each fictitious contributor. The committee must adjust its sub- The following documents have special sig- totals for itemized and unitemized contributions nature and submission requirements: accordingly on the Detailed Summary Page. If a • Schedule C1 (Loans and Line of Credit), solicitation or commercial mailing is sent to one including copies of loan agreements; and of the fictitious names, the committee will know • Form 8 (Debt Settlement Plan). that someone has illegally used the names of contributors disclosed on its reports. The com- These two forms, in addition to being included mittee may then file a complaint with the FEC. in the electronic report, must be submitted on paper or in a digitized format (submitted as a When a committee files a report containing ficti- separate file in the electronic report). 104.18(h). tious names, a list of the fictitious names should be sent under separate cover directly to the FEC’s Reports Analysis Division—not the Secretary of the Senate (where Senate candidates’ reports 6. Public Inspection of reports are filed). The list will be kept confidential. All reports filed by political committees are available for public inspection and copying (for a Sale or Use of Committee’s minimal fee) in the FEC’s Public Records Office. Contributor List They are also available on the Commission’s The sale or use restriction does not prevent website (http://www.fec.gov/disclosure.shtml). a committee from compiling its own list of Copies of reports may also be purchased by contributors and distributing it to others. mail. For more information, call 800/424-9530 Under certain conditions, a committee may (press 2 when prompted) or 202/694-1120. donate, sell, trade or rent its own contribu- tor list to other committees and organizations. “Sale or Use” Restriction AOs 2002-14, 1982–41 and 1981–53. The Act prohibits anyone from selling or using the names and addresses of individual contribu- tors, copied from FEC reports, for commercial purposes or for the purpose of soliciting funds. This “sale or use” restriction, however, does not apply to the names and addresses of politi- cal committees that are listed in FEC reports. 2 U.S.C. 438(a)(4); 104.15; see also AO 2003-24. “Salting” Reports to Detect Misuse When preparing a report to be filed, a com- mittee may “salt” the report with up to 10 fictitious names in order to detect impermis- sible uses of individual contributor informa- tion by other organizations. 104.3(e). Salting can be done by taking a portion of the subtotal for unitemized contributions and allocat- ing it, as itemized contributions, among several fictitious contributors. The committee itemizes each fictitious contribution on a Schedule A, providing a real address (such as the address 86 Completing FEC Reports ChAPTEr 13 Completing FEC Reports 1. reporting Forms campaign committee and all other authorized committees. The principal campaign committee and Formats files Form 3Z along with its own report and those of the other authorized committees. 104.3(f). FEC reports are filed either electronically or on paper, as explained in the previous chapter. This section explains each format’s requirements. Requirements for Electronic Filers Committees that receive contributions or make Form 3 expenditures of more than $50,000 in any calendar year, or have reason to expect to do so, must file FEC Form 3 (or an electronic version) must all reports and statements electronically. Com- be used by principal campaign committees and mittees that are required to file electronically, but other authorized committees of candidates for that file on paper or fail to file, may be subject to the U.S. House of Representatives and U.S. Sen- enforcement action as nonfilers. 104.18(a)(2). See ate to disclose receipts and disbursements.1 Chapter 12, Section 4, “Administrative Fines for Form 3 Booklet Late Filers and Nonfilers.” FECFile software, avail- able free from the FEC, generates Form 1, Form 3 The Form 3 booklet contains Form 3 (Sum- and Form 6. Filers can download the software from mary Page and Detailed Summary Page), the the FEC’s website at www.fec.gov/elecfil/electron. schedules listed below and Form 3Z. shtml. Filers can also use other software as long Schedules as it meets FEC format specifications. For more information about the electronic filing require- Committees may be required to file the fol- ment, see Section 5 of the preceding chapter. lowing schedules as attachments to Form 3: • Schedule A—Itemized Receipts Requirements for Paper Filers • Schedule B—Itemized Disbursements FEC forms filed on paper should be typed • Schedule C—Loans (either on a typewriter or on a computer—see • Schedule C-1—Loans and Lines of below for more information on computerized Credit from Lending Institutions forms); printing in ink is also acceptable (but not recommended) as long as the forms are legible. • Schedule D—Debts and Obligations Because filings will be imaged and photocopied Form 3Z several times before being placed on the public record, it is required that committees submit the If a candidate has more than one authorized original report—not a copy – with an original committee for the same campaign, the principal signature. 104.14. Committees submitting illeg- campaign committee must also file Form 3Z. The ible documents will be required to refile. one-page form, which consolidates information for the entire campaign, contains information taken from the current reports of the principal Reporting Instructions Instructions for filling out each form and schedule 1 Presidential campaign committees use FEC Form are available online at http://www.fec.gov/info/ 3P and its supporting schedules (or an electronic forms.shtml. Although written specifically for version). Form 3P and instructions are available online at http://www.fec.gov/info/forms.shtml#candidates. 87 Chapter 13 paper filers, the instructions contain informa- *The faxline numbers for Schedules A, B, C and D tion that is useful for electronic filers as well. produce both Form 3 and Form 3X versions of the schedules; House and Senate candidate com- Online Web Forms mittees should be sure to use the Form 3 version. Online filing via the FEC’s web forms is FEC website available for the following FEC Forms: All FEC reporting forms and instructions, • FEC Form 6 (48-hour notices of including Form 1, Form 2 and Form 3, are last minute contributions); available on the Commission’s website at • FEC Form 8 (Debt settlement plan). http://www.fec.gov/info/forms.shtml. For more information, and to access the online forms, visit http://www.fec.gov/elecfil/online.shtml. 2. Special rules for First report Computerized Forms When filing the first report due after registering A committee that files on paper may develop as a political committee, the principal campaign its own computer-produced forms, reduced to committee (and other authorized committees the size of FEC forms, but it must submit them of the campaign) must disclose all financial activ- for approval by the FEC prior to using them. ity that occurred before registration and before The submission must include sample formats of the individual became a candidate (including any each applicable schedule (with sample data). The testing-the-waters activity), beginning with the first proposed format (and accompanying cover letter) date of activity through the end of the current should be mailed or hand delivered to the atten- reporting period. 101.2(b), 101.3, 104.3(a) and (b). tion of the Reports Analysis Division. 104.2(d); FEC Directive 37. Please note that this is not an option for committees required to file electronically. 3. Categorizing receipts How to Obtain Paper Forms Committees must report receipts under the different categories listed on the Detailed Sum- Fax on Demand mary Page of Form 3. These categories are: The reporting forms (and instructions) are avail- • Lines 11(a)(i) and (ii), Contribu- able on the FEC Faxline 202/501-3413. Below tions from Individuals/Persons Other are the document numbers of the reporting Than Political Committees forms for candidates and their committees: • Line 11(b), Contributions from • Form 1 - Statement of Organization - #801 Political Party Committees; • Form 2 - Statement of Candidacy - #802 • Line 11(c), Contributions from Other • Form 3 - Financial Reporting for Authorized Political Committees (e.g., PACs); (i.e., Candidate) Committees - #803 • Line 11(d), Contributions from the Candidate; • Form 6 - 48-Hour Notice of Contri- • Line 12, Transfers from Other butions/Loans Received - #806 Authorized Committees; • Form 8 - Debt Settlement Plan - #808 • Lines 13(a) and (b), Loans; • Schedule A* - Itemized Receipts - #825 • Line 14, Offsets to Operating Expenditures; and • Schedule B* - Itemized Disbursements - #826 • Line 15, Other Receipts. • Schedule C* and C-1 - Loans - #827 For detailed information describing each • Schedule D* - Debts and Obligations - #828 category see “The Detailed Summary Page” section later in this chapter. 88 Completing FEC Reports For each category, a committee must disclose • Election to which a contribution or loan the total for the current reporting period and was designated (indicated by checking “pri- the cumulative election-cycle total. In addition mary,” “general” or “other” in the election to reporting these totals, a committee often has designation box) (For more information to itemize receipts by providing supplemental on designating contributions for a specific information on supporting Schedule As. 104.3(a) election, see Chapter 4, Section 4, “Desig- (3) and (4). A committee must use a separate nated and Undesignated Contributions”); Schedule A for each category of receipts that • Date of receipt; must be itemized, i.e., the committee may not mix different categories of receipts on the same • Amount of receipt; and schedule. Electronic filers must input all data for • Aggregate election-cycle-to-date total each contributor or payer separately so that the of all receipts (within the same cat- software can properly generate the required infor- egory) from the same source. mation, including the aggregated election-cycle- 100.12, 104.3(a)(4) and 104.8(a). to-date total. It is recommended that committees Note that the date of receipt for both record- complete the supporting Schedules first before keeping and reporting purposes is the date transferring totals to the Detailed Summary Page. that the campaign, or a person who receives a contribution CONTRIBUTIONS FROM OTHER POLITICAL COMMITTEES AND on behalf of the campaign, first ORGANIZATIONS receives a contribution, rather than the date on the check or SCHEDULE A (FEC Form 3) the date of deposit. 102.8(a). FOR LINE NUMBER: PAGE OF Use separate schedule(s) (check only one) ITEMIZED RECEIPTS X (See Chapter 4, Section 5, “Date for each category of the Detailed Summary Page 11a 12 11b 13a 11c 13b 11d 14 15 Contribution is Made v. Date of Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Receipt” for more information.) Full Name (Last, First, Middle Initial) A. Ellie James for U.S. Senate Mailing Address Date of Receipt If a contributor is self-employed, 543 Stormybrook Street 02 21 2012 that should be stated in the M M / D D / Y Y Y Y City State Zip Code Great Falls VA 00000 “Employer” space on Schedule A. FEC ID number of contributing C 00000001 Amount of Each Receipt this Period federal political committee. Name of Employer Occupation , ▲ 2,000.00 , ▲ . ▲ If he or she is not employed, the Receipt For: Election Cycle-to-Date space may be left blank, but the X ▼ Primary Other (specify) ▼ General , ▲ 2,000.00 , ▲ . ▲ “Occupation” space should still be completed (e.g., “unemployed,” “retired,” “homemaker.”) See Chapter 11, Section 5, “Treasurer’s 4. how to Itemize receipts Best Efforts” regarding steps that must be taken to obtain information about contributors. For each receipt to be itemized, the committee must report the: • Name of source of receipt (i.e., the name of the 5. When to Itemize receipts person who gave something of value or paid money to the candidate or the committee); Some receipts must be itemized regardless of • Mailing address of source; their amount, while others need not be item- ized until their aggregate election-cycle-to-date • Employer of source (if source is total exceeds a threshold dollar value. These an individual contributor); concepts are further explained below. • Occupation of source (if source is an individual contributor); 89 Chapter 13 Regardless of Amount contributions and other receipts on an election- cycle basis, as explained in the next paragraphs. Within the following four categories of receipts listed on the Detailed Summary Page, every Election Cycle receipt must be itemized regardless of amount: An election cycle begins the day after the general • Contributions from party committees and election for a seat or office and ends on the day organizations (including those that do not of the next general election for that seat or office. qualify as political committees under the Fed- 100.3(b). The length of the election cycle, thus, eral Election Campaign Act (the Act)) (Line 11(b)); depends on the office sought. The election cycle • Contributions from other political committees is two years for House candidates, four years for and organizations (including all committees Presidential candidates and six years for Senate that are political committees under the Act) candidates. For example, the election cycle for (Line 11(c). See example on previous page); a 2012 Senate candidate began on November 8, 2006 (the day after the previous general elec- • Transfers from affiliated com- tion), and will end on November 6, 2012 (the day mittees (Line 12); and of the general election). On the other hand, the • Loans (Lines 13(a) and 13(b)). election cycle for 2012 House candidates began See 104.3(a)(4)(ii), (iii)(A) and (iv). on November 3, 2010 (the day after the 2010 general election), and will end on November 6, 2012 (the day of the 2012 general election). Itemization Threshold Exceeded Within the other categories, receipts from Example of Aggregation each source must be itemized if they: Suppose an individual makes two con- • Exceed $200; or tributions to a principal campaign com- mittee during an election cycle. • Aggregate over $200 when added to other receipts (within the same category) received from the same source AGGREGATION OF CONTRIBUTIONS during an election cycle. FOR LINE NUMBER: PAGE OF SCHEDULE A (FEC Form 3) Use separate schedule(s) (check only one) The categories of receipts ITEMIZED RECEIPTS for each category of the Detailed Summary Page X 11a 12 11b 13a 11c 13b 11d 14 15 that are subject to this $200 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. threshold for itemization are: NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) • Contributions from indi- A. Kane, Sally Mailing Address Date of Receipt 211 Spruce Street 03 01 2012 M M / D D / Y Y Y Y viduals/persons other than City State Zip Code Clifton VA 00000 political committees; FEC ID number of contributing C Amount of Each Receipt this Period federal political committee. 185.00 • Contributions from Name of Employer First National Bank Occupation Banker , ▲ , ▲ . ▲ the candidate; Receipt For: Primary X General Election Cycle-to-Date ▼ Other (specify) ▼ , ▲ , ▲ 260.00 . ▲ • Offsets to operating expenditures; and • Other receipts. See Primary Election Contribution 104.3(a)(4)(i), (v) and (vi). The donor contributes $75 just before the Aggregation: Election Cycle vs. Per Election candidate’s primary election. Because it is undes- Note that authorized committees must aggregate ignated, the contribution automatically applies contributions on a per-election basis when moni- to the primary limit. The contribution does not toring contribution limits. See Chapter 4. For pur- exceed $200 and is his first contribution to poses of reporting, however, committees aggregate the candidate, so the committee includes the 90 Completing FEC Reports amount in its total of unitemized contributions Expenditures by Candidate (Line 11(a)(ii) on the Detailed Summary Page). Campaign expenditures made by the candidate General Election Contribution from personal funds that are not to be reimbursed are reported as in-kind contributions from the During the following reporting period, but after candidate and reported like other in-kind contribu- the primary election, the same donor makes a tions. See “Reporting In-Kind Contributions” later $185 contribution. This contribution must be in this chapter for more information on reporting itemized since the aggregate total of the donor’s these expenditures by candidates. If, on the other contributions for the election cycle ($260) hand, a personal expenditure by the candidate now exceeds the $200 threshold for itemiza- is intended to be reimbursed, it is treated as an tion. When itemizing the $185 contribution on advance from the candidate for reporting pur- Schedule A, the committee checks “General” in poses. See Section 11 on reporting advances. the election designation box and reports the donor’s aggregate election-cycle total as $260, Loans from Candidate’s Personal Funds even though $75 applies to the primary and The candidate may loan personal funds to the com- $185 to the general. (See example opposite.) mittee and may charge interest at a commercially reasonable rate, provided the committee reports the loan and the interest rate from the outset on 6. reporting Contributions, Schedule C. The committee continues to report Loans and Advances the loan until it is repaid. 116.11; AO 1986-45. See Section 17 of this chapter, “Reporting Loans.” from Candidate Bank Loans Obtained by Candidate for Contributions (including loans and Campaign Related Purposes advances) from the candidate must be If a candidate obtains a bank loan for campaign- reported by the campaign as follows: related purposes, the committee must report the Contributions from Candidate loan from the candidate as a receipt and repayment of the loan to the candidate as a disbursement Personal funds contributed to the campaign 104.3(a)(3)(vii)(B) and (b)(2)(iii)(A) and 100.82(c). are reported on Line 11(d) as contributions In addition, both the original loan and payments from the candidate. (See example below.) to reduce principal must be reported on Schedule C each reporting period until the loan is repaid. Furthermore, a com- CONTRIBUTIONS FROM CANDIDATE’S PERSONAL FUNDS mittee that obtains a loan from a bank must also file Schedule C-1 SCHEDULE A (FEC Form 3) with the first report due after Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF X the new loan. 104.3(d). See also for each category of the ITEMIZED RECEIPTS Detailed Summary Page 11a 11b 11c 11d 12 13a 13b 14 15 Section 17, “Reporting Loans.” Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) Doe, Jane Contributions Intended to be Loans A. Date of Receipt Mailing Address 626 Pritham Ave. 02 10 2012 Receipts that are intended as con- M M / D D / Y Y Y Y City State Zip Code Springﬁeld VA 00000 FEC ID number of contributing tributions (rather than loans) from C Amount of Each Receipt this Period federal political committee. Name of Employer Occupation , ▲ 1,000.00 , ▲ . ▲ the candidate may not later be con- U.S. House U.S. Representative Receipt For: Election Cycle-to-Date verted into loans. For that reason, X ▼ Primary Other (specify) ▼ General , ▲ 2,200.00 , ▲ . ▲ the campaign should initially report such transactions as loans to be repaid. AOs 2006-37 and 1997-21. 91 Chapter 13 Last-Minute Contributions or Loans from Candidate record each contribution according to the rules set Note that contributions or loans from the out in Chapter 11.) 110.1(k)(2). If neither contribu- candidate of $1,000 or more, received less than tor has previously contributed to the committee 20 days but more than 48 hours before any during the year, the committee does not have to election in which the candidate is running, must itemize either contribution; nor does it have to be reported on a “48-Hour Notice.” (See “Last- itemize the $300 total joint contribution. If, on the Minute Contributions in Chapter 12, Section 3.) other hand, the $300 check is accompanied by a signed statement attributing $250 to one individual and $50 to the other, the $250 contribution must be itemized. The $50 contribution is included in 7. reporting Joint the total of unitemized contributions reported Contributions2 on Line 11(a)(ii) of the Detailed Summary Page.3 8. reporting JOINT CONTRIBUTIONS redesignations and SCHEDULE A (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF reattributions4 ITEMIZED RECEIPTS for each category of the Detailed Summary Page X 11a 11b 11c 11d 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions Receipt of Original or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee A. Full Name (Last, First, Middle Initial) Bigshot, William Mailing Address Date of Receipt Contribution 555 8th Street 03 20 2012 M M / D D / Y Y Y Y City Herndon State VA Zip Code 00000 When itemizing a contribution FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period that must first be redesignated Name of Employer Occupation , ▲ , ▲ 500.00 . ▲ or reattributed before it is Bigshot and Co. Executive Receipt For: Primary X General Election Cycle-to-Date ▼ legally acceptable, a committee 500.00 Other (specify) ▼ , ▲ , ▲ . ▲ must include a statement on Schedule A noting that the Full Name (Last, First, Middle Initial) B. Bigshot, Lucy Date of Receipt Mailing Address 555 8th Street 03 02 20 10 2012 legality of the contribution M M / D D / Y Y Y Y City State Zip Code Herndon VA 00000 FEC ID number of contributing is in question.5 103.3(b)(5). federal political committee. C Amount of Each Receipt this Period Name of Employer Occupation , ▲ , 500.00 ▲ 1000.00 . ▲ Wigs and More Receipt For: Primary X General Store Owner Election Cycle-to-Date ▼ Receipt of 500.00 Other (specify) ▼ , ▲ ▲ 2200.00 , . ▲ Redesignation or Reattribution A committee must also comply For purposes of reporting, a committee treats a with special procedures when reporting the receipt joint contribution as though the individuals par- of reattributions and redesignations of contribu- ticipating in the contribution had made their con- tions that were originally itemized on previous tributions separately, and itemizes them separately reports. (There is no need to report a reattribu- on Schedule A as required. (See example above.) tion or redesignation if the original contribution 110.1(k)(1). For example, if a committee receives a $300 check with two signatures but with no 3 As explained in the Explanation and Justification written attribution, the committee attributes the to revised rules on contribution limits, prescribed contribution equally between the donors—$150 to April 8, 1987, 52 Fed. Reg. 760 (January 9, 1987). each contributor. (Note that the committee must 4 Redesignations and reattributions are explained in Chapter 4. 2 See also Chapter 4 for more information 5 This procedure applies to any contribution that on joint contributions. appears to be illegal or that is questionable. 92 Completing FEC Reports date the redesignation or reattribu- REDESIGNATIONS tion was received and, in the case of a redesignation, the election for SCHEDULE A (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF which the contribution was redesig- ITEMIZED RECEIPTS for each category of the X 11a 11b 11c 11d Detailed Summary Page 12 13a 13b Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions 14 15 nated. 104.8(d)(2) and (3). (See the or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) examples at left and on page 94.) Doe for Congress Committee Full Name (Last, First, Middle Initial) A. Bancroft, Carrie Mailing Address 426 9th St. City State Zip Code Date of Receipt 12 M M / D 02 D / Y 2011 Y Y Y Refund of Excessive Portion Annandale VA 00000 FEC ID number of contributing If a committee requests a redesigna- C Amount of Each Receipt this Period federal political committee. Name of Employer Occupation , ▲ 5,000.00 , ▲ . ▲ tion or reattribution but does not James & Smith Attorney receive it within 60 days of the Receipt For: Election Cycle-to-Date MEMO X See year-end report ▼ Primary Other (specify) ▼ General , ▲ 5,000.00 , ▲ . ▲ Redesignation below contribution’s receipt, the committee Full Name (Last, First, Middle Initial) must refund the excessive portion of B. Bancroft, Carrie Date of Receipt Mailing Address 426 9th St. 01 02 M M / D 15 10 D / Y 2012 Y Y Y the contribution within 60 days of the City Annandale State VA Zip Code 00000 treasurer’s receipt of the contribu- FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period tion and disclose the refund on its , -2,500.00 ▲ 1000.00 , . Name of Employer James & Smith Occupation Attorney ▲ ▲ next report (see Section 19 of this MEMO chapter). 103.3(b)(3) and 104.8(d)(4). Receipt For: Election Cycle-to-Date X ▼ Primary General 5,000.00 Redesignated below , ▲ 2200.00 , . Other (specify) ▼ ▲ ▲ Full Name (Last, First, Middle Initial) C. Bancroft, Carrie Date of Receipt Mailing Address 426 9th St. 01 02 15 10 2012 M M / D D / Y Y Y Y City Annandale State VA Zip Code 00000 9. reporting Free Legal and Accounting Services FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period Name of Employer Occupation , ▲ 2,500.00 ▲ 1000.00 , . ▲ James & Smith Attorney Receipt For: Election Cycle-to-Date MEMO X ▼ Primary General Redesignated An authorized committee may receive , ▲ 2200.00 5,000.00 , . Other (specify) ▼ ▲ ▲ free legal and accounting services provided solely to help the commit- was not itemized.6) On the report covering the tee comply with the Act, as explained period during which the committee received the in Chapter 7. If the value of services paid for by redesignation or reattribution, the committee one person (the employer) exceeds $200 or must disclose, as a memo entry, information on aggregates over $200 during an election cycle, the both the original contribution and the redesigna- committee must itemize the following informa- tion or reattribution. The memo entry appears tion as a memo entry on a separate Schedule A: on a Schedule A for the category of contribution • The name of each employee per- involved. (For example, a reattribution would forming the services; appear with other itemized contributions on a Schedule A used for “Contributions from Individu- • The name and address of the employer als/Persons Other Than Political Committees.”) of the person providing the services; The first part of the memo entry discloses all • The amounts paid for the ser- the information on the contribution as it was vices by the employer; and originally reported on Schedule A. The second • The dates the services were performed. part of the memo entry discloses as a negative 100.86 and 104.3(h). The Schedule A should entry the amount of the redesignation. The third be clearly labeled as exempt legal or account- part discloses information on the contribution as ing services. (See example on page 94.) it was redesignated or reattributed, including the 6 As explained in the Explanation and Justification to revised rules on contribution limits, prescribed April 8, 1987, 52 Fed. Reg. 760 (January 9, 1987). 93 Chapter 13 REATTRIBUTIONS 10. reporting In-Kind Contributions FOR LINE NUMBER: PAGE OF SCHEDULE A (FEC Form 3) Use separate schedule(s) (check only one) ITEMIZED RECEIPTS for each category of the Detailed Summary Page X 11a 11b 11c 11d Schedules A and B 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee When determining whether to Full Name (Last, First, Middle Initial) Richmond, Howard A. Mailing Address Date of Receipt itemize an in-kind contribution, a 40 Shepard Cir. 12 09 2011 M M / D D / Y Y Y Y City Centreville State VA Zip Code 00000 committee should treat it the same FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period as a monetary contribution. The only Name of Employer Occupation , ▲ 5,000.00 , ▲ . ▲ difference is that the amount of an Space Tech Engineer MEMO Receipt For: Primary X General Election Cycle-to-Date ▼ See year-end 2011 in-kind contribution must also be 5,000.00 Other (specify) ▼ , ▲ , ▲ . ▲ Reattribution below included in the committee’s total B. Full Name (Last, First, Middle Initial) Richmond, Howard Date of Receipt operating expenditures in order Mailing Address 40 Shepard Cir. 02 01 10 2012 to avoid inflating cash on hand. An M M / D D / Y Y Y Y City State Zip Code Centreville VA 00000 FEC ID number of contributing in-kind contribution must be item- C Amount of Each Receipt this Period federal political committee. Name of Employer Occupation , ▲ -2,500.00 ▲ 1000.00 , . ▲ ized as an operating expenditure Space Tech Engineer on Schedule B only if it has to Receipt For: Election Cycle-to-Date MEMO X ▼ be itemized as a contribution on Primary General Reattributed below , ▲ 2200.00 2,500.00 , . Other (specify) ▼ ▲ ▲ Full Name (Last, First, Middle Initial) Richmond, Jessie Schedule A. (For information on C. Date of Receipt Mailing Address 40 Shepard Cir. 02 M M / 01 10 D D / Y 2012 Y Y Y how to value an in-kind contribu- City State Zip Code Centreville VA 00000 tion, see Chapter 3, Section 2.) (See example on opposite page.) FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period Name of Employer Occupation , ▲ 2,500.00 ▲ 1000.00 , . ▲ None Homemaker MEMO Advances of Personal Funds Receipt For: Election Cycle-to-Date X ▼ Primary General Reattributed , ▲ 2200.00 2,500.00 , . Other (specify) ▼ ▲ ▲ Although an advance of personal funds by an individual to purchase goods and services (with the excep- tion of some travel costs) is consid- ered an in-kind contribution, special FREE LEGAL AND ACCOUNTING SERVICES reporting rules apply if it is to be reimbursed. For more information, PAGE OF see the next sections on reporting FOR LINE NUMBER: SCHEDULE A (FEC Form 3) Use separate schedule(s) (check only one) for each category of the ITEMIZED RECEIPTS 11a 11b 11c 11d advances and travel expenses. Detailed Summary Page 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) Thomason, Steve Reporting Appreciated Goods as Contributions A. Date of Receipt Mailing Address 145 Netherton Rd. 02 19 2012 M M / D D / Y Y Y Y City State Zip Code Tysons Corner VA 00000 FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period When a committee receives Name of Employer Occupation , ▲ 3,000.00 , ▲ . ▲ an in-kind contribution whose Pierce, James & Dewey Accountant MEMO Receipt For: X Primary General Election Cycle-to-Date ▼ Exempt accounting value may appreciate over time, , 3,000.00 , . services Other (specify) ▼ ▲ ▲ ▲ such as stock or artwork, spe- cial reporting rules apply: • Itemize the initial gift, if necessary, as a memo entry on Schedule A (see “When to Itemize Receipts,” above). Under “Amount,” report the fair market value of the contribution on 94 Completing FEC Reports the date the item was received. IN-KIND CONTRIBUTION (SCHEDULE A) Do not include that amount in the total for Line 11(a)(i) on SCHEDULE A (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF the Detailed Summary Page. No X 11c itemization on Schedule B is nec- for each category of the ITEMIZED RECEIPTS Detailed Summary Page 11a 11b 11d 12 13a 13b 14 15 essary. (See example on page 96.) Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) • Once the item is sold, Gold Nugget Corporation PAC A. Mailing Address Date of Receipt report the sale price as a con- 100 Commerce Ave. 02 20 2012 M M / D D / Y Y Y Y City Springﬁeld State VA Zip Code 00000 tribution on Line 11(a)(i) if the FEC ID number of contributing federal political committee. C 00000000 Amount of Each Receipt this Period purchaser is known or as an Name of Employer Occupation , ▲ , ▲ 260.00 . ▲ “other receipt” on Line 15 if the Receipt For: X Primary General Election Cycle-to-Date ▼ In-Kind purchaser is unknown. Itemize the 1,260.00 Other (specify) ▼ , ▲ , ▲ . ▲ transaction on Schedule A if nec- essary. (See example on page 96.) Also, if the purchaser is known, then the amount of the purchase, IN-KIND CONTRIBUTION (SCHEDULE B) when aggregated with other con- tributions by the purchaser, must FOR LINE NUMBER: PAGE OF fall within the contribution limits. SCHEDULE B (FEC Form 3) Use separate schedule(s) (check only one) X ITEMIZED DISBURSEMENTS 104.13(b). See also AOs for each category of the 17 18 19a 19b Detailed Summary Page 20a 20b 20c 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. 2000-30 and 1989–06. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) Gold Nugget Corporation PAC A. Date of Disbursement 02 20 2012 11. reporting M M / D D / Y Y Y Y Mailing Address 100 Commerce Ave. City State Zip Code Amount of Each Disbursement this Period Springﬁeld Purpose of Disbursement In-Kind: Postage VA 00000 , ▲ , ▲ 260.00 . ▲ reimbursed Advances of Candidate Name Category/ Type Ofﬁce Sought: House Disbursement For: X Personal Funds Senate Primary General President Other (specify) ▼ State: District: (Non-Travel) As explained in Chapter 7 and in the previ- ous section, when any individual, including a volunteer, a committee staff member or the candidate, uses his or her personal funds or personal credit to pay a vendor for a cam- paign expense and is later reimbursed by the committee, special reporting rules apply. Non-Travel Advances Made and Reimbursed Within Same Reporting Period Non-travel advances that are made and reimbursed within the same reporting period are considered contributions and must be reported as follows: • Do not report the original advance unless, at the end of the reporting period, the amount 95 Chapter 13 APPRECIATED GOODS AS CONTRIBUTIONS Non-Travel Advances Made and Reimbursed SCHEDULE A (FEC Form 3) ITEMIZED RECEIPTS Use separate schedule(s) for each category of the FOR LINE NUMBER: (check only one) X 11a 11b 11c PAGE 11d OF in Different Reporting Periods Detailed Summary Page 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Non-travel advances that Full Name (Last, First, Middle Initial) A. Kane, Sally Mailing Address Date of Receipt are to be reimbursed in a 211 Spruce Street 01 21 2012 M M / D D / Y Y Y Y City State Zip Code later reporting period must Clifton VA 00000 FEC ID number of contributing C Amount of Each Receipt this Period be reported as follows: federal political committee. , , 185.00 . Name of Employer First National Bank Occupation Banker ▲ ▲ ▲ • Do not report the original Receipt For: Primary X General Election Cycle-to-Date ▼ advance unless, at the end of Other (specify) ▼ , , 260.00 . ▲ ▲ ▲ the reporting period in which the advance was made, the amount of previous contribu- tions in the election cycle SALE OF APPRECIATED GOODS AS CONTRIBUTIONS from the person making the advance plus the amount SCHEDULE A (FEC Form 3) FOR LINE NUMBER: PAGE OF of the advance minus the Use separate schedule(s) (check only one) ITEMIZED RECEIPTS for each category of the Detailed Summary Page 11a 12 11b 13a 11c 13b 11d 14 X 15 amount of the reimburse- Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. ment is greater than $200 (i.e. NAME OF COMMITTEE (In Full) Doe for Congress Committee previous contributions + the A. Full Name (Last, First, Middle Initial) Bull Market Brokerage Date of Receipt advance - the reimbursement Mailing Address 1212 King Street 03 M M / 31 D D / Y 2012 Y Y Y > $200). In that case, report City State Zip Code Alexandria VA 00000 the advance as a memo entry FEC ID number of contributing C contribution on Schedule A; Amount of Each Receipt this Period federal political committee. Name of Employer Occupation , ▲ , ▲ 750.00 . ▲ Receipt For: Election Cycle-to-Date XYZ Corp stock sold • Report the amount of the Primary General ▼ through broker. Other (specify) ▼ , ▲ , ▲ 750.00 . ▲ Purchaser unknown. advance outstanding at the end of the reporting period as a debt on Schedule D if it exceeds $500 or of previous contributions in the election has been outstanding for cycle from the person making the advance more than 60 days (see plus the amount of the advance minus the example at right); and amount of the reimbursement is greater than $200 (i.e., previous contributions + • Report the reimbursement, once made, as an the advance - the reimbursement > $200). operating expenditure and, if reimbursements In that case, report the advance as a memo to that person exceed $200 in the election entry contribution on Schedule A; and cycle, itemize it on Schedule B (with a cross- reference to the memo entry on Schedule A • Report the reimbursement as an operat- for the advance—if the advance was itemized). ing expenditure and, if reimbursements to that person exceed $200 in the elec- See examples on opposite page. See AO 1992-01. tion cycle, itemize it on Schedule B (with a cross-reference to the memo entry on Schedule A for the advance—if the advance was itemized). AO 1992-01. 96 Completing FEC Reports NONTRAVEL REIMBURSEMENTS 12. reporting Travel Expenses FOR LINE NUMBER: PAGE OF SCHEDULE B (FEC Form 3) Use separate schedule(s) (check only one) X ITEMIZED DISBURSEMENTS As explained in Chapter 10, for each category of the 17 18 19a 19b Detailed Summary Page 20a 20b 20c 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. when a committee pays for its NAME OF COMMITTEE (In Full) Doe for Congress Committee own travel expenses, it reports Full Name (Last, First, Middle Initial) the payment as an operating Lotze, Herman Date of Disbursement A. Mailing Address 01 M M / 20 D D / Y 2012 Y Y Y expenditure. In certain situations, 912 Geist Street City Springﬁeld State VA Zip Code 00000 Amount of Each Disbursement this Period the payment may be made by a 750.00 Purpose of Disbursement Reimbursement for ofﬁce supplies , ▲ , ▲ . ▲ campaign traveler. In that case, no contribution results if the individual Candidate Name Category/ Type Ofﬁce Sought: House Disbursement For: Senate President X Primary Other (specify) ▼ General is reimbursed by the committee State: District: within certain time periods. Travel Expenses Reimbursed Within NONTRAVEL STAFF ADVANCES MADE AND REIMBURSED IN DIFFERENT REPORTING PERIODS 30 or 60 Days As explained in Chapter 7, no FOR LINE NUMBER: PAGE OF contribution results when the SCHEDULE A (FEC Form 3) ITEMIZED RECEIPTS Use separate schedule(s) for each category of the Detailed Summary Page (check only one) X 11a 11b 11c 11d committee reimburses an indi- 12 13a vidual for travel expenses within 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee the following time periods: • If the individual paid with Full Name (Last, First, Middle Initial) A. Allen, Lisa Date of Receipt Mailing Address 828 Pine Street 01 02 2012 cash or a personal check, M M / D D / Y Y Y Y City State Zip Code McLean VA 00000 FEC ID number of contributing C Amount of Each Receipt this Period within 30 days from the date federal political committee. Name of Employer Occupation , ▲ , ▲ 750.00 . ▲ the expense was incurred. In-kind, printing Receipt For: X Primary General Election Cycle-to-Date ▼ to be reimbursed • If the individual paid with Other (specify) ▼ , 1,000.00 , . ▲ ▲ ▲ a credit card, within 60 days of the closing date SCHEDULE D (FEC Form 3) (Use separate PAGE OF on the credit card billing schedule(s) FOR LINE NUMBER: DEBTS AND OBLIGATIONS Excluding Loans for each numbered line) (check only one) X 9 10 statement. 116.5(b). (See NAME OF COMMITTEE (In Full) Doe for Congress Committee Chapter 7, Section 4, “Reim- A. Full Name (Last, First, Middle Initial) of Debtor or Creditor Nature of Debt (Purpose): bursed Travel Expenses,” Allen, Lisa Mailing Address Print job- for more information.) 828 Pine Street to be reimbursed City State Zip Code McLean VA 00000 Outstanding Balance Beginning This Period Reimbursed Within Time Limit , ▲ , ▲ Amount Incurred This Period 0.00 . ▲ Payment This Period Outstanding Balance at Close of This Period and in Same Reporting Period , , 750.00 . , , 0.00 . , , 750.00 . ▲ ▲ ▲ ▲ ▲ ▲ ▲ ▲ ▲ When the committee makes a reimbursement within these time limits, the commit- tee reports the advance and reimbursement as follows: • The original advance is not reported; and 97 Chapter 13 • The reimbursement is reported as an operat- the advance plus any other contributions ing expenditure on Line 17. AO 1992-01. made by the same person within the elec- tion cycle, minus any reimbursements made Reimbursed Within Time Limit but in the reporting period, exceeds $200; in Later Reporting Period • Report the amount of the advance outstand- Note that, if the reimbursement is made within ing at the end of the reporting period as a the appropriate time limit but not within the debt on Schedule D if it exceeds $500 or has reporting period in which the advance was made, been outstanding for more than 60 days; and the committee must report the advance on Schedule D as a debt if it exceeds $500. Once the • Report the reimbursement as an operating reimbursement is actually made, the committee expenditure and, if reimbursements to that reports it as an operating expenditure and item- person exceed $200 in the election cycle, item- izes it on Schedule B if reimbursements to any ize it on Schedule B (with a cross-reference one person exceed $200 for the election cycle. to the memo entry on Schedule A for the advance—if the advance was itemized). Travel Advances Not Reimbursed Within 30 or 60 Days Special Rule for Reporting Not Reimbursed Within Time Limit but Reimbursements (for Travel Within Same Reporting Period and Subsistence Advances) Travel advances that are not reimbursed If the total amount reimbursed for a travel within the appropriate 30 or 60 day time limit or subsistence expense is $500 or less, the (116.5(b)) but that are reimbursed within the committee should report the individual receiv- reporting period in which the advance is made ing the reimbursement as the payee. If the are considered in-kind contributions 100.93(i). total amount exceeds $500 and payments to Such advances must be reported as follows: any one vendor used for the expenses total • Report the original advance as a memo entry over $200 for the election cycle, additional contribution on Schedule A if the total of information is required to achieve full disclo- the advance plus any other contributions sure. In this instance the committee must: made by the same person within the elec- • Report the individual receiving reim- tion cycle, minus any reimbursements made bursement as payee; and in the reporting period, exceeds $200; and • Report the payments aggregating over $200 • Report the reimbursement as an operating to any one vendor as memo entries on expenditure and, if reimbursements to that Schedule B. See AO 1996-20, footnote 3. person exceed $200 in the election cycle, item- ize it on Schedule B (with a cross-reference to the memo entry on Schedule A for the advance—if the advance was itemized). 13. Categorizing Not Reimbursed Within Time Limit and Disbursements Not Within Same Reporting Period Like receipts, disbursements are Travel advances that are not reimbursed divided into several categories on the within the appropriate 30 or 60 day time limit Detailed Summary Page of Form 3. (116.5(b)) and that are not reimbursed within These categories are: the reporting period in which the advance was made must be reported as follows: • Line 17, Operating Expenditures • Report the original advance as a memo entry • Line 18, Transfers to Other contribution on Schedule A if the total of Authorized Committees 98 Completing FEC Reports • Line 19(a), Repayments of Loans Made • Category/Type of disbursement (numbered or Guaranteed by the Candidate categories detailed on the Instructions for • Line 19(b), Repayments of All Other Loans Schedule B, Itemized Disbursements; available online at http://www.fec.gov/pdf/forms/fec- • Line 19(c), Total Loan Repayments frm3i.pdf), (filling in this category is optional); • Line 20(a), Refunds of Contribu- • Date of disbursement; and tions (made by) Individuals/Persons Other than Political Committees • Amount of disbursement. • Line 20(b), Refunds of Contributions 104.3(b)(4) and 104.9. (made by) Political Party Committees • Line 20(c), Refunds of Contributions (made by) Purpose Other Political Committees (such as PACs) For reporting purposes, the “purpose” of disburse- • Line 20(d), Total Contribution Refunds ment refers to a brief statement or description about the reason for the disbursement. The • Line 21, Other Disbursements. description must be sufficiently specific, when For detailed information describing each considered within the context of the payee’s category see “The Detailed Summary identity, to make the reason for the disbursement Page” section later in this chapter. clear. 104.3(b)(4)(i)(A) and (B). The Commission For each category, a committee must disclose has published a non-exhaustive list of accept- the total for the current reporting period and able and unacceptable purpose descriptions at the election-cycle-to-date total. In addition to http://www.fec.gov/law/policy.shtml#purpose. reporting these totals, a committee often has to itemize disbursements by providing supplemental Election Designation information on supporting Schedules B. 104.3(b)(2) When itemizing a disbursement, the commit- and (4). A committee must use a separate Schedule tee does not need to check the box designat- B for each category of disbursements that must ing it for a particular election (“primary,” be itemized; the committee may not mix different “general” or “other”), unless the entry relates categories of disbursements on the same sched- to a contribution to another candidate. In that ule. Electronic filers must separately enter each case, the committee must indicate the elec- disbursement when entering data in order to cor- tion to which it relates (see example below.) rectly generate the report. Paper-filing committees should complete the supporting Schedules first so that they may transfer totals from these Schedules to the Detailed Summary Page. OPERATING EXPENDITURES 14. how to Itemize Disbursements FOR LINE NUMBER: PAGE OF SCHEDULE B (FEC Form 3) Use separate schedule(s) (check only one) ITEMIZED DISBURSEMENTS for each category of the Detailed Summary Page X 17 18 19a 19b 20a 20b 20c 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. For each disbursement that must NAME OF COMMITTEE (In Full) Doe for Congress Committee be itemized, the committee must Full Name (Last, First, Middle Initial) Quick Printing Inc. Date of Disbursement A. include the following information: Mailing Address 01 M M / 28 D D / Y 2012 Y Y Y 567 4th Street • Name of payee; City Fair Lakes State VA Zip Code 00000 Amount of Each Disbursement this Period Purpose of Disbursement , , 300.00 . Printing Brochures 006 ▲ ▲ ▲ • Address of payee; Candidate Name Category/ Type • Purpose of disbursement (a Ofﬁce Sought: House Disbursement For: Senate Primary General President Other (specify) ▼ brief description of why the State: District: disbursement was made); 99 Chapter 13 Contributions to Other Candidates 15. When to Itemize Contributions to other candidates are included in Disbursements the total for Line 21 (“Other Disbursements”) and are itemized on Schedule B for that Line if they are made to a federal candidate for any amount or are Regardless of Amount made to a nonfederal candidate and exceed $200 for the election cycle to date. When itemizing a Three categories of disbursements must contribution to another candidate (either federal be itemized regardless of amount: or nonfederal, e.g., state or local), the commit- • Transfers (Line 18); tee must report the information listed above. • Loan Repayments (Lines 19(a) and 19(b)); and Additional Information Required for • Contributions to other federal candidates Contributions to Other Federal Candidates (Line 21). 104.3(b)(4)(ii), (iii) and (v). If the contribution is to a federal candi- Refunds of contributions must be item- date, the committee must also itemize: ized only if the incoming contribution • The recipient candidate’s name; had to be itemized on Schedule A. • The office sought by check- ing the appropriate box; Itemization Threshold Exceeded • The state and, if applicable, Con- Two categories of disbursements are subject to gressional district; and the $200 election cycle threshold for itemization: • The election for which the contribution • Operating Expenditures (Line 17); and was made (by checking the appropriate • Other Disbursements (encompassing all box—“primary,” “general” or “other”). disbursements that do not fit into the other It is recommended that the commit- categories) (Line 21). 104.3(b)(4)(i) and (vi). tee designate any contributions it makes. A disbursement under these categories 104.3(b)(3)(v). (See example below.) must be itemized if it: • Exceeds $200; or CONTRIBUTIONS TO OTHER FEDERAL CANDIDATES • Aggregates over $200 when added to other disbursements SCHEDULE B (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: PAGE OF (within the same category) (check only one) ITEMIZED DISBURSEMENTS for each category of the Detailed Summary Page 17 20a 18 20b 19a 20c X 19b 21 made to the same payee Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. during an election cycle. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) Credit Card Transactions Cunningham for Senate A. Date of Disbursement Mailing Address 03 M M / 29 D D / Y 2012 Y Y Y In the case of operating expen- 77 Center Street City Houston State TX Zip Code 00000 Amount of Each Disbursement this Period ditures charged on a credit card, 2,000.00 Purpose of Disbursement Contribution 011 , ▲ , ▲ . ▲ a committee must itemize a pay- ment to a credit card company Candidate Name Richard Cunningham Category/ Type Ofﬁce Sought: House Disbursement For: X Senate Primary X General if the payment exceeds the $200 President Other (specify) ▼ TX State: District: aggregate threshold for itemization explained above. The committee must also itemize, as a memo entry, any specific transaction charged on a credit card if the payment to the actual vendor exceeds the $200 threshold. The memo entry must also include the name and address of the vendor, the purpose of the 100 Completing FEC Reports disbursement and the amount of the disbursement. Finally, any credit CREDIT CARD TRANSACTIONS (SCHEDULE B) card debt must be reported fol- lowing the procedures outlined in FOR LINE NUMBER: PAGE OF SCHEDULE B (FEC Form 3) the next section. 102.9(b)(2) and ITEMIZED DISBURSEMENTS Use separate schedule(s) for each category of the Detailed Summary Page (check only one) X 17 18 19a 19b 104.9. (See examples on right.) 20a 20b 20c 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) 16. reporting Credit Card Company A. Date of Disbursement 02 28 2012 M M / D D / Y Y Y Y Mailing Address 12 Muche Ct. Debts Other City Philadelphia State PA Zip Code 00000 Amount of Each Disbursement this Period , 1,300.00 , . Than Loans Purpose of Disbursement Credit Card Payment - see below 001 ▲ ▲ ▲ Candidate Name Category/ Type Ofﬁce Sought: House Disbursement For: Senate Primary General President Other (specify) ▼ Schedule D: Continuous State: District: Full Name (Last, First, Middle Initial) Southeast Airlines Date of Disbursement B. Reporting 01 12 2012 M M / D D / Y Y Y Y Mailing Address 777 Jetstream Way City State Zip Code Amount of Each Disbursement this Period Dulles VA 00000 Debts and obligations must be Purpose of Disbursement Airline Tickets 002 , ▲ , ▲ 750.00 . ▲ reported continuously until repaid. Candidate Name Category/ MEMO Type 104.3(d) and 104.11. Unpaid bills Ofﬁce Sought: House Senate Disbursement For: Primary General credit card co. Other (specify) ▼ and written contracts or agree- President State: District: Full Name (Last, First, Middle Initial) ments to make expenditures C. Date of Disbursement are considered debts. 100.112. M M / D D / Y Y Y Y Mailing Address Debts and obligations (other than City State Zip Code Amount of Each Disbursement this Period Purpose of Disbursement , , . loans—see Section 17 for report- Candidate Name Category/ ▲ ▲ ▲ ing loans, below) are reported on Ofﬁce Sought: House Disbursement For: Type Lines 9 and 10 of the Summary Senate Primary General President Other (specify) ▼ State: District: Page and itemized on Schedule D 1,300.00 SUBTOTAL of Disbursements This Page (optional) .................................................................. , ▲ , ▲ . ▲ ▼ according to the following rules: TOTAL This Period (last page this line number only) ............................................................... , ,1,300.00 . ▲ ▲ ▲ ▼ • A debt of $500 or less is FEC Schedule B (Form 3) (Revised 02/2003) reportable once it has been outstanding 60 days from the date incurred (the date of the transaction, not the date the bill is received). The CREDIT CARD TRANSACTIONS (SCHEDULE D) debt is disclosed on the next regularly scheduled report. SCHEDULE D (FEC Form 3) (Use separate schedule(s) PAGE FOR LINE NUMBER: OF DEBTS AND OBLIGATIONS for each (check only one) 9 X 10 • A debt exceeding $500 must Excluding Loans NAME OF COMMITTEE (In Full) numbered line) Doe for Congress Committee be reported in the report A. Full Name (Last, First, Middle Initial) of Debtor or Creditor Nature of Debt (Purpose): covering the date on which Credit Card Company Mailing Address Credit card debt the debt was incurred. City 12 Muche Ct. State Zip Code Philadelphia PA 00000 104.3(d), 104.11 and 116.6(c). Outstanding Balance Beginning This Period , ,1,200.00 . The committee must use sepa- ▲ ▲ ▲ Amount Incurred This Period Payment This Period Outstanding Balance at Close of This Period rate Schedule D forms for debts , ▲ 1,300.00 , ▲ . ▲ , ▲ ,1,300.00 ▲ . ▲ , ▲ 1,200.00 , ▲ . ▲ owed by the committee (Line 10) versus debts owed to the committee (Line 9). Paper filers must label each schedule accord- ingly by checking the appropri- 101 Chapter 13 ate box at the top of the form; electronic filing programs will DEBTS OWED BY THE COMMITTEE (SCHEDULE B) label the Schedules for you. FOR LINE NUMBER: PAGE OF SCHEDULE B (FEC Form 3) Use separate schedule(s) (check only one) Exception ITEMIZED DISBURSEMENTS for each category of the Detailed Summary Page X 17 20a 18 20b 19a 20c 19b 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions Regularly recurring administra- or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) tive expenses such as rent, Doe for Congress Committee Full Name (Last, First, Middle Initial) utilities and salaries are not A. WCFS-FM Date of Disbursement 01 31 2012 M M / D D / Y Y Y Y considered to be debts until Mailing Address 1290 Tower Street they are past due. 104.11(b). City State Zip Code Amount of Each Disbursement this Period Winchester VA 00000 Purpose of Disbursement , 2,500.00 , . Radio Advertisement 004 ▲ ▲ ▲ Candidate Name Jane Doe Category/ Debts Owed by the Type Ofﬁce Sought: House Disbursement For: See Schedule D Senate Primary General Committee President Other (specify) ▼ State: District: The committee reports the total of outstanding debts (from Schedule D) plus the balance DEBTS OWED BY THE COMMITTEE (SCHEDULE D) of loans owed by the commit- tee (from Schedule C) on Line SCHEDULE D (FEC Form 3) (Use separate PAGE OF 10 of the Summary Page. DEBTS AND OBLIGATIONS schedule(s) for each FOR LINE NUMBER: (check only one) 9 Excluding Loans numbered line) X 10 NAME OF COMMITTEE (In Full) Itemizing Debts Owed Doe for Congress Committee Nature of Debt (Purpose): A. Full Name (Last, First, Middle Initial) of Debtor or Creditor Schedule D is used to report: WCFS-FM Mailing Address Radio Advertisement; 1290 Tower Street See Schedule B, Line 17 • The outstanding amount owed City Winchester State VA Zip Code 00000 on a debt or obligation; Outstanding Balance Beginning This Period , ▲ , ▲ 0.00 . ▲ • Payments made to Amount Incurred This Period 5,500.00 Payment This Period Outstanding Balance at Close of This Period , ▲ , ▲ . ▲ , ▲ ,2,500.00 ▲ . ▲ , ▲ 3,000.00 , ▲ . ▲ reduce the debt; • Complete name and address of creditor; and • The nature and purpose of the debt. Special Debt Reporting Problems The instructions for Schedule D (available Debts of Unknown Amount online at http://www.fec.gov/pdf/forms/fec- frm3i.pdf#page=18) explain what additional If the exact amount of a debt is not known, the information is required. Note that payments committee reports an estimated amount. The to reduce debts must also be reported under committee must either amend the report (and the appropriate category of disbursement all subsequent reports) to indicate the correct on the Detailed Summary Page (for example, amount, once a correct figure is known, or include Line 17 for a payment on a bill for an operat- the correct figure, along with an explanation of ing expenditure). (See examples at right.) the change, in the report for the reporting period during which the amount is determined. 104.11(b). Settlement of Debts Unpayable Debts Special rules apply to debts that are forgiven If a debt cannot be paid because the creditor or settled for less than their full amount. has gone out of business or cannot be located, See Chapter 14 for more information. the treasurer may write to the FEC to request permission to discontinue reporting the debt. The letter must demonstrate that the debt is at least two years old and that efforts to 102 Completing FEC Reports ascertain the current address of the credi- 17. reporting Loans tor and to reach the creditor have been made by registered or certified letter and either in All loans received by a committee must be item- person or by phone. The committee must con- ized and continuously reported until extinguished. tinue to report the debt until the Commission 104.3(a)(4)(iv) and (d); 104.11. All repayments determines that the debt is unpayable. 116.9. made on a loan must also be itemized. 104.3(b) Disputed Debts (4)(iii). Procedures for reporting loans and loan repayments are explained below. See also A disputed debt is a bona fide disagreement “Reporting Contributions, Loans and Advances between the creditor and the committee as to from Candidate” in Section 6 of this chapter. the existence of a debt or the amount owed by the committee. 116.10. If the creditor provided something of value, notwithstanding the disputed Schedule A: Initial Receipt of Loan amount, then the committee must disclose: A committee must itemize the receipt of a loan, • The amount the committee admits it owes; regardless of amount, on a separate Schedule A for the appropriate loan category (“made/guaran- • The amount the creditor claims is owed; and teed by the candidate” or “all other loans”). (See • Any amounts the committee has paid examples of Schedule A below.) 104.3(a)(4)(iv). the creditor. The committee may also note on the report that disclosure of BANK LOANS ENDORSED BY CANDIDATE a disputed debt is not an admis- sion of liability or a waiver of any FOR LINE NUMBER: PAGE OF SCHEDULE A (FEC Form 3) claims against the creditor. Once ITEMIZED RECEIPTS Use separate schedule(s) for each category of the (check only one) 11a 11b 11c 11d X 13a Detailed Summary Page a disputed debt is resolved, the 12 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. committee should report the cor- NAME OF COMMITTEE (In Full) Doe for Congress Committee rect amount on the next report, Full Name (Last, First, Middle Initial) National Trust Bank along with a statement explaining A. Date of Receipt Mailing Address 800 Lincoln Ave. 03 01 2012 M M / D D / Y Y Y Y that the dispute was resolved. City Reston State VA Zip Code 00000 FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period 20,000.00 Debts Owed to the Name of Employer Occupation , ▲ , ▲ . ▲ Receipt For: (guaranteed) Election Cycle-to-Date X Primary General ▼ Committee Other (specify) ▼ , ▲ 20,000.00 , ▲ . ▲ The committee must continuously report a debt owed to the com- mittee on Schedule D if the debt exceeds $500 or Schedule B: Interest and has been outstanding 60 days. 104.3(d) and 104.11. Principal Payments Payments received on the debt are also reported on Schedule D until the debt is retired. The debt A committee must report interest paid on a repayments received must also be reported on loan as an operating expenditure, itemizing the the appropriate Line number of the Detailed Sum- payment on a Schedule B for operating expen- mary Page and itemized on Schedule A if neces- ditures once interest payments to one payee sary. On Line 9 of the Form 3 Summary Page, the aggregate over $200 in an election cycle. committee enters the total of outstanding debts Payments to reduce principal must be item- owed to it (from Schedule D), plus the balance of ized, regardless of amount, on a Schedule B outstanding loans owed to it (from Schedule C). for the appropriate category of loan repay- Paper filers must be sure to label the Schedule ment (“made/guaranteed by the candidate” D as “debt owed to the committee” by checking or “all other loans”). 104.3(b)(4)(iii). (See the box for Line 9 at the top of Schedule D. Schedule B example on page 104.) 103 Chapter 13 sible lending institution must LOAN PAYMENT also file Schedule C-1 with the first report due after a new SCHEDULE B (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE loan or line of credit has been OF X ITEMIZED DISBURSEMENTS established. 104.3(d)(1). A new for each category of the 17 18 19a 19b Detailed Summary Page 20a 20b 20c 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. Schedule C-1 must also be filed NAME OF COMMITTEE (In Full) Doe for Congress Committee with the next report if the terms A. Full Name (Last, First, Middle Initial) National Trust Bank Date of Disbursement of the loan or line of credit are 03 30 2012 restructured. Additionally, in the M M / D D / Y Y Y Y Mailing Address 800 Lincoln Avenue City Reston State VA Zip Code 00000 Amount of Each Disbursement this Period case of a committee that has , ▲ 271.18 , . obtained a line of credit, a new Purpose of Disbursement Loan Principal payment 009 ▲ ▲ Candidate Name Schedule C-1 must be filed with Category/ Type Ofﬁce Sought: House Disbursement For: Senate President Primary Other (specify) ▼ General the next report whenever the State: District: committee draws on the line of credit. 104.3(d)(1) and (3). (See Schedule C: Continuous Reporting example of Schedule C-1 on page 106.) For loans derived from a candidate In addition, both the original loan and payments loan, the reporting on Schedule C-1 is simplified. to reduce principal must be reported on Schedule See the next section for more information. C each reporting period (see examples) until the loan is repaid. Committee Has No Other LOANS FROM CANDIDATE’S PERSONAL FUNDS (SCHEDULE A) Debts or Obligations FOR LINE NUMBER: PAGE OF SCHEDULE A (FEC Form 3) Use separate schedule(s) (check only one) If the committee has no other ITEMIZED RECEIPTS for each category of the Detailed Summary Page 11a 12 X 13a 11b 11c 13b 11d 14 15 debts, the Schedule C balance of Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. the total amount owed on loans is NAME OF COMMITTEE (In Full) Doe for Congress Committee entered on Line 10 of the Form 3 Full Name (Last, First, Middle Initial) Doe, Jane (personal funds) A. Date of Receipt Summary Page (“Debts and Obli- Mailing Address 626 Pritham Ave. M 02 M / D 10 D / Y 2012 Y Y Y City State Zip Code gations Owed by the Committee”). Springﬁeld VA 00000 FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period 1,000.00 Committee Has Other Debts or Name of Employer U.S. House Occupation U.S. Representative , ▲ , ▲ . ▲ Obligations (Reported on Schedule D) Receipt For: X Primary General Election Cycle-to-Date ▼ Personal funds Other (specify) ▼ , ▲ 2,200.00 , ▲ . ▲ If the committee has other debts or obligations that are reported on Schedule D, the total amount owed on loans is entered on Line 3 at the bottom of Schedule C LOANS FROM CANDIDATE’S PERSONAL FUNDS (SCHEDULE C) and is carried over to the last PAGE OF page of Schedule D along with SCHEDULE C (FEC Form 3) Use separate schedule(s) for each category of the FOR LINE NUMBER: X LOANS (check only one) 13a the other debts and obligations. Detailed Summary Page 13b NAME OF COMMITTEE (In Full) The total from Schedule D is then Doe for Congress Committee LOAN SOURCE Full Name (Last, First, Middle Initial) Election: entered on Line 10 of the Form Jane Doe – personal funds X Primary General 3 Summary Page reflecting all Mailing Address 626 Pritham Ave. Other (specify) ▼ outstanding debts or obligations. City Springﬁeld State VA ZIP Code 00000 Schedule C-1: Additional Information Original Amount of Loan Cumulative Payment To Date Balance Outstanding at Close of This Period , 1,000.00 , . , , 0.00 . , ,1,000.00 . for Loans from Lending Institutions TERMS ▲ ▲ ▲ ▲ ▲ ▲ ▲ ▲ ▲ Date Incurred Date Due Interest Rate Secured: A committee that obtains a loan 03 23 2012 none none . X M M / D D / Y Y Y Y M M / D D / Y Y Y Y ▲ % (apr) Yes No from a bank or other permis- 104 Completing FEC Reports Line-by-line instructions for fill- CANDIDATE HOME EQUITY LINE OF CREDIT (SCHEDULE A) ing out the schedule appear in the Form 3 instruction booklet. SCHEDULE A (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF The committee treasurer or designated assistant treasurer for each category of the ITEMIZED RECEIPTS 11a 11b 11c 11d X 13a Detailed Summary Page 12 13b 14 15 must sign the schedule on Line Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee G and attach a copy of the loan agreement. 104.3(d)(2). Full Name (Last, First, Middle Initial) A. Doe, Jane Date of Receipt Mailing Address 626 Pritham Ave. 03 15 2012 M M / D D / Y Y Y Y City Springﬁeld State VA Zip Code 00000 Finally, an authorized representa- FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period tive of the lending institution must Name of Employer Occupation , ▲ 50,000.00 , ▲ . ▲ sign the statement on Line I. U.S. House U.S. Representative Receipt For: Election Cycle-to-Date home equity X Primary General ▼ line of credit Other (specify) ▼ , ▲ 60,000.00 , ▲ . ▲ 18. reporting Bank Loans, Brokerage CANDIDATE HOME EQUITY LINE OF CREDIT PRINCIPAL PAYMENT Loans and Other Lines of Credit When Made to FOR LINE NUMBER: PAGE OF SCHEDULE B (FEC Form 3) Use separate schedule(s) (check only one) ITEMIZED DISBURSEMENTS for each category of the Detailed Summary Page 17 18 X 19a 19b 20a 20b 20c 21 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Candidates Doe for Congress Committee A. Full Name (Last, First, Middle Initial) National Trust Bank Date of Disbursement Bank loans to candidates and loans 03 30 2012 derived from advances on a candi- M M / D D / Y Y Y Y Mailing Address 800 Lincoln Avenue City Reston State VA Zip Code 00000 Amount of Each Disbursement this Period date’s brokerage accounts, credit Purpose of Disbursement , 5,000.00 , . Line of Credit Payment (Candidate Loan) Candidate Name ▲ ▲ ▲ cards, home equity line of credit, Jane Doe Category/ Ofﬁce Sought: X House Disbursement For: Type or other lines of credit obtained X Senate President Primary Other (specify) ▼ General for use in connection with his or State: VA District: 12 her campaign must be reported by the committee. 100.83. The committee must report the loan CANDIDATE HOME EQUITY LINE OF CREDIT INTEREST PAYMENT from the candidate as a receipt and repayment of the loan to SCHEDULE B (FEC Form 3) FOR LINE NUMBER: PAGE OF the candidate as a disbursement. Use separate schedule(s) (check only one) ITEMIZED DISBURSEMENTS for each category of the Detailed Summary Page X 17 20a 18 20b 19a 20c 19b 21 104.3(a)(3)(vii)(B) and (b)(2)(iii)(A). Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions Schedule A or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) The candidate may choose either National Trust Bank A. Date of Disbursement Mailing Address 03 M M / 30 D D / Y 2012 Y Y Y to loan or to contribute the loan 800 Lincoln Avenue City Reston State VA Zip Code 00000 Amount of Each Disbursement this Period proceeds to the authorized com- Purpose of Disbursement , , 350.00 . mittee. If the candidate treats the Interest payment on candidate loan ▲ ▲ ▲ funds as a personal contribution, Candidate Name Jane Doe Category/ Type Ofﬁce Sought: X House Disbursement For: Senate President X Primary Other (specify) ▼ General the receipt of the contribution VA 12 State: District: from the candidate must be reported on Schedule A for Line 11(d). If the candidate treats the funds as a loan, the receipt of the loan must be reported on Schedule A for Line 13(a). (See example on 105 Chapter 13 T • he types and value of collateral CANDIDATE HOME EQUITY LINE OF CREDIT (SCHEDULE C) or other sources of repayment that secure the loan, advance SCHEDULE C (FEC Form 3) PAGE OF or line of credit. 104.3(d)(1). Use separate schedule(s) FOR LINE NUMBER: LOANS for each category of the X Unlike loans to committees, when (check only one) 13a Detailed Summary Page 13b NAME OF COMMITTEE (In Full) Doe for Congress Committee reporting bank loans obtained by the candidate or loans derived LOAN SOURCE Full Name (Last, First, Middle Initial) Election: Jane Doe – Home equity line of credit X Primary General Mailing Address 626 Pritham Ave. from the candidate’s broker- Other (specify) ▼ City Springﬁeld VA 00000 State age account, credit card, home ZIP Code Original Amount of Loan equity line of credit or other Cumulative Payment To Date Balance Outstanding at Close of This Period , ▲ 50,000.00 , ▲ . ▲ , ▲ ▲ 5,000.00 , . ▲ , ▲ 45,000.00 , ▲ . ▲ line of credit, the committee is not required to submit the loan TERMS Date Incurred Date Due Interest Rate Secured: 03 15 2012 01 31 2014 6.00 % . X M M / D D / Y Y Y Y M M / D D / Y Y Y Y ▲ agreement to the Commission. (apr) Yes No Note, however, that Schedule C-1 must still be filed when the page 106.) If the funds are designated as a contribu- candidate obtains a loan and then contributes tion, then the committee cannot repay the underly- the proceeds to the committee. 104.3(d)(4). ing loan to the financial institution. AO 2006-37. Keeping Records Schedule B The committee must retain records relat- If the funds are designated as a loan, the com- ing to the loan for three years after the date mittee’s repayment to the lending institution of the election in which the candidate ran. or the candidate is reported as an itemized Additionally, the candidate must preserve the entry on Schedule B. The committee is not following records for three years after the elec- required to report repayments by the can- tion for which he or she was a candidate: didate to the lending institution. 104.3(b)(4). The loan must also be continually reported on • Records to demonstrate the ownership of Schedule C or C-P until it is extinguished. the accounts or assets securing the loans; • Copies of the executed loan agreements Schedule C and all security and guarantee statements; The committee need only list the candidate as • Statements of account for all accounts the source of the loan on Schedule C. However, used to secure any loan for the period the type of loan the candidate receives (i.e. the loan is outstanding such as broker- bank loan, brokerage account, credit card, home age accounts or credit card accounts and equity line of credit, other line of credit) must statements on any line of credit that was also be disclosed in either the first box for used for the purpose of influencing the endorsers and guarantors with a notation for candidate’s election for federal office; loan type or in the box for “Loan Source” after the candidate’s name. (See example above.) • Documentation to establish the source of the funds in the account Schedule C-1 and the time of the loan; and The committee must disclose, in the report • Documentation for all payments made on the covering the period when the loan was loan by any person. 104.14(b)(3) and (4). obtained, the following information on Schedule C-1 (see example opposite): • The date, amount, and interest rate of the loan, advance or line of credit; • The name and address of the lending institution; and 106 Completing FEC Reports CANDIDATE HOME EQUITY LINE OF CREDIT (SCHEDULE C-1) 19. reporting refunds, returns SCHEDULE C-1 (FEC Form 3) Supplementary for and Bounced LOANS AND LINES OF CREDIT FROM LENDING INSTITUTIONS Federal Election Commission, Washington, D.C. 20463 Information found on Page of Schedule C Checks NAME OF COMMITTEE (In Full) FEC IDENTIFICATION NUMBER Doe for Congress Committee C 00033000 LENDING INSTITUTION (LENDER) Full Name Amount of Loan , 50,000.00 , . Interest Rate (APR) 6.00 . % Refunds v. Returns National Trust Bank ▲ ▲ ▲ ▲ Mailing Address Date Incurred or Established 03 M M / 15 D D / Y 2012 Y Y Y A refund occurs when the com- 800 Lincoln Avenue City State Zip Code Date Due 01 M M / 31 D D / Y 2014 Y Y Y mittee has actually deposited a Reston VA 00000 contribution in its bank depository X M M / D D / Y Y Y Y A. Has loan been restructured? No Yes If yes, date originally incurred B. If line of credit, Total and then pays it back to the con- Amount of this Draw: , ▲ , ▲ 0.00 . ▲ Outstanding Balance: , ▲ , ▲ 0.00 . ▲ tributor by issuing a check. When a committee refunds a contribution C. Are other parties secondarily liable for the debt incurred? XNo Yes (Endorsers and guarantors must be reported on Schedule C.) What is the value of this collateral? to a donor, the committee must D. Are any of the following pledged as collateral for the loan: real estate, personal property, goods, negotiable instruments, certiﬁcates of deposit, chattel papers, stocks, accounts receivable, cash on deposit, or other similar traditional collateral? , ▲ 250,000.00 , ▲ . ▲ No X Yes If yes, specify: real estate include the refund in the total Does the lender have a perfected security E. Are any future contributions or future receipts of interest income, pledged as interest in it? No Yes for the appropriate category of collateral for the loan? No X Yes If yes, specify: What is the estimated value? , ▲ , ▲ 0.00 . ▲ refund on the Detailed Summary A depository account must be established pursuant to 11 CFR 100.82(e)(2) and 100.142(e)(2). Location of account: Page (Lines 20(a), (b) or (c)). If the Date account established: M M / D D / Y Y Y Y Address: committee previously itemized the City, State, Zip: F. If neither of the types of collateral described above was pledged for this loan, or if the amount pledged does not equal or incoming contribution on Schedule exceed the loan amount, state the basis upon which this loan was made and the basis on which it assures repayment. A, then it must itemize the refund G. COMMITTEE TREASURER Gottlob Frege DATE on a Schedule B for the appropri- H. Typed Name Signature Gottlob Frege Attach a signed copy of the loan agreement. M 03 M / D 15 D / Y 2012 Y Y Y ate category of refund. 104.8(d) (4). (See example on page 108.) Alternatively, a committee may return a contribution to the donor without depositing it, although the return must be made within 10 days of the treasurer’s receipt of the contribution. 103.3(a). In this case, the committee does not have to report either the receipt or the return of the contribution. Checks Returned Due to Insufficient Funds If a committee reports the receipt of a check and later finds it cannot be negotiated because of insufficient funds in the donor’s account, the committee should deduct the amount of the check in its next report as follows: • If the committee did not itemize the receipt on a previous report, it subtracts the amount of the check from the total for the appropri- ate category of receipts. The reduced total is entered on the Detailed Summary Page. • If the committee previously itemized the receipt, it itemizes the return of the check as 107 Chapter 13 a negative entry on the appropriate REFUNDED CONTRIBUTIONS (SCHEDULE A) Schedule A. (See example on left.) FOR LINE NUMBER: PAGE OF Checks received and returned by SCHEDULE A (FEC Form 3) ITEMIZED RECEIPTS Use separate schedule(s) for each category of the Detailed Summary Page (check only one) 11a 11b X 11c 11d the bank in the same reporting period do not need to be reported. 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) Very Controversial PAC 20. reporting A. Date of Receipt Mailing Address 879 Peabody Street 03 19 2012 M M / D D / Y Y Y Y City State Zip Code Washington FEC ID number of contributing federal political committee. DC C 00000 Amount of Each Receipt this Period Transfers Name of Employer Occupation Refunded 3/30/12 , ▲ 5,000.00 , ▲ . ▲ Between Authorized Receipt For: See Schedule B, Election Cycle-to-Date X Primary General ▼ Other (specify) ▼ , ▲ 5,000.00 , ▲ . ▲ Line 20(c) Committees As explained in Chapter 9, autho- rized committees may make and REFUNDED CONTRIBUTIONS (SCHEDULE B) receive transfers to and from other federal authorized com- SCHEDULE B (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF mittees of the same candidate. ITEMIZED DISBURSEMENTS for each category of the 17 18 19a 19b Detailed Summary Page 20a 20b Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions X 20c 21 The following sections explain the or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) rules for reporting the permissible Doe for Congress Committee Full Name (Last, First, Middle Initial) transfers discussed in Chapter 9. Very Controversial PAC A. Date of Disbursement 03 30 2012 M M / D D / Y Y Y Y Transfers Between Mailing Address 879 Peabody Street City State Zip Code Amount of Each Disbursement this Period Washington DC 00000 Purpose of Disbursement Refund of 3/19/12 contribution 001 , ▲ 5,000.00 , ▲ . ▲ Candidate’s Committees for the Same Office Candidate Name Jane Doe Category/ Disbursement For: Type See Schedule A, Ofﬁce Sought: House Senate X Primary General Line 11(c) President Other (specify) ▼ In the Same Election Cycle State: District: Transfers between a candidate’s authorized committees for the same election are reported by the CHECKS RETURNED DUE TO INSUFFICIENT FUNDS transferring committee on Line 18 FOR LINE NUMBER: PAGE OF of the Form 3 Detailed Summary SCHEDULE A (FEC Form 3) ITEMIZED RECEIPTS Use separate schedule(s) for each category of the Detailed Summary Page (check only one) X 11a 11b 11c 11d Page, and by the committee receiv- ing the transfer on Line 12 of the 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Form 3 Detailed Summary Page. Doe for Congress Committee Full Name (Last, First, Middle Initial) 104.3(a)(3)(vi) and (b)(2)(ii). The A. Light, Jack receiving committee does not need Date of Receipt Mailing Address 421 Overdraw Street 03 01 2012 M M / D D / Y Y Y Y City Falls Church State VA Zip Code 00000 to reitemize the sources of the FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period funds transferred (e.g., contributions , ▲ -300.00 , . Name of Employer None Occupation Graduate Student ▲ ▲ that comprise the transfer) because the transferring committee has Receipt For: Bounced check Election Cycle-to-Date X Primary General ▼ Other (specify) ▼ , ▲ , ▲ 0.00 . ▲ already itemized them in its report to the principal campaign commit- tee, which is attached to the prin- 108 Completing FEC Reports TRANSFERS BETWEEN CANDIDATE’S COMMITTEES, SAME OFFICE transfer on Schedule A, regardless of amount. 104.3(a)(4)(iii)(A). (See SCHEDULE A (FEC Form 3) FOR LINE NUMBER: PAGE OF Chapter 9 for information on when Use separate schedule(s) (check only one) ITEMIZED RECEIPTS for each category of the Detailed Summary Page 11a X 12 11b 13a 11c 13b 11d 14 15 such transfers are permissible.) In Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. addition, as discussed in Chapter NAME OF COMMITTEE (In Full) Doe for Congress Committee 9, the receiving committee must A. Full Name (Last, First, Middle Initial) Friends of Jane Doe Date of Receipt aggregate the contributions that Mailing Address 147 Felicity Circle City State Zip Code M M / D D / Y Y Y Y make up the transfer with any other Fairfax VA 00000 contributions it receives from the FEC ID number of contributing C 00000002 same contributor. 110.3(c)(5). Amount of Each Receipt this Period federal political committee. Name of Employer Occupation , ▲ 3,000.00 , ▲ . ▲ Receipt For: X Primary General Election Cycle-to-Date ▼ If the aggregate contributions Other (specify) ▼ , ▲ 3,000.00 , ▲ . ▲ from one contributor exceed $200 in the election cycle, the receiving committee must item- cipal campaign committee’s consolidated report ize the contributions as memo (Form 3Z). 110.3(c). (See example opposite.) entries on a Schedule A. The recipient committee must also report the total transfer on Line 12 In Different Election Cycles of the Form 3 Detailed Summary Page and must The receiving committee also does not have to itemize the source of the transfer on Schedule itemize contributions transferred between commit- A, regardless of amount. See AO 1984-38. tees authorized by one candidate for two different The committee making the transfer must report election cycles as long as the original contributions the transfer on Line 18 of the Form 3 Detailed count against the limits for the election for which Summary Page and must itemize the disbursement the contributions were intended. 110.3(c)(4). on Schedule B, regardless of amount. 104.3(b)(4)(ii). Example: A 2010 House candidate has a surplus from that campaign. The candidate may roll over Transfers of Joint Fundraising Receipts that amount to his or her committee for reelection For information on reporting trans- in 2012 without again itemizing the contribu- fers of joint fundraising receipts, see tions that make up the transfer, provided that: Appendix C, “Joint Fundraising.” • He or she did not become a candi- date for the 2012 election before the 2010 general election; and 21. reporting Investments • The surplus transferred from the 2010 committee consists of contributions that A committee that has invested its funds—for count against the 2010 limits rather than example, in a savings account, money market fund the 2012 limits (i.e., were designated for or or certificate of deposit—must include the total made prior to the 2010 general election). amount invested in its cash on hand (Line 27 of the Form 3 Detailed Summary Page). It should Transfers Between Candidate’s not report any investment as a disbursement, since the money has not actually been spent, but, Committees for Multiple Offices instead, is still a committee asset. 104.3(a)(1). A candidate’s authorized committee for one office (e.g., a Senate campaign) receiving a transfer from that candidate’s authorized committee for another office (e.g., a House campaign) must report the total transfer on Line 12 of the Form 3 Detailed Summary Page and must itemize the 109 Chapter 13 Reporting Additional Depository 22. Completing the report Funds Invested with Banks As noted previously, paper filers should complete If a committee invests the funds in a bank that the itemization schedules first so that they may was not previously identified as a campaign accurately complete the Summary Page and the depository on the Statement of Organiza- Detailed Summary Page. After completing the tion (FEC Form 1), the committee must file an schedules, transfer their totals, plus other relevant amended Statement of Organization disclosing totals derived from the committee’s records, to the name and address of the new deposi- the Detailed Summary Page. Calculations from the tory. The amendment must be filed within 10 Detailed Summary Page and from Schedules C days of making the investment. 102.2(a)(2). and D are then transferred to the Summary Page. Paper filers should refer to the next two sections Funds Invested with Other Establishments for detailed information. Note that electronic filing If committee funds are invested in a fund that is software completes these tasks automatically. not operated by a bank (such as a money market fund operated by a brokerage firm), no amend- ment to the Statement of Organization is required. 23. The Detailed Before using the funds (principal or interest) to make expenditures, the committee must first Summary Page transfer them to a designated campaign checking account. 103.3(a). See, for example, AO 1986-18. The Detailed Summary Page lists the totals for various categories of receipts and disbursements. Note, however, that interest or other income Some of the figures are taken from the totals earned on these investment accounts need not listed on the attached Schedules A and B, some be placed in the campaign depository account are totals of figures that are not itemized on before they are reinvested. As noted above, these schedules and some are combined totals investments are not expenditures; they are of itemized figures from the schedules plus some simply a conversion of assets from one form unitemized figures. (See example of Detailed to another. The committee must report the Summary Page opposite and on page 111.) reinvested income from investments follow- ing the rules explained below. AO 1997-06. Column A and Column B Reporting Investment Income and Loss Note that Column A is for the figures relating to amounts received and disbursed during the Report investment income received or lost dur- reporting period covered by the report. Column ing the reporting period in the “Other Receipts” B lists totals for the election cycle to date. category (Line 15) of the Detailed Summary Page. If investment income from one source aggregates over $200 during a calendar year, itemize the Line 11. Contributions interest on a Schedule A for Line 15. 104.3(a)(4) Line 11(a). Contributions from Individuals/Persons (vi). Losses are indicated by negative entries. Other Than Political Committees (i.e. Individuals and Reporting Income Tax Other Groups That Are Not Political Committees) A committee must report, as an operating Use Line 11 to report contributions from expenditure, income tax paid on investment individuals and groups other than political com- income. Income tax payments must be item- mittees (such as partnerships, sole proprietor- ized on a Schedule B for Line 17 (Operating ships and certain LLC’s and Indian tribes). Expenditures) only if the payments aggregate • Enter the total of itemized contributions over $200 during an election cycle to the same from individuals and other groups (not payee (the local, state or federal government). political committees) on Line 11(a)(i). 110 Completing FEC Reports • On Line 11(a)(ii), enter the total amount of unitem- DETAILED SUMMARY PAGE ized contributions. • On Line 11(a)(iii), enter the total of itemized and DETAILED SUMMARY PAGE of Receipts FEC Form 3 (Revised 12/2003) Page 3 unitemized contributions Write or Type Committee Name Doe for Congress Committee from individuals/others. 01 01 2012 03 31 2012 M M / D D / Y Y Y Y M M / D D / Y Y Y Y Line 11(b). Contributions from Report Covering the Period: From: To: Political Party Committees I. RECEIPTS COLUMN A Total This Period COLUMN B Election Cycle-to-Date On Line 11(b), enter the total 11. CONTRIBUTIONS (other than loans) FROM: amount of contributions from (a) Individuals/Persons Other Than Political Committees (i) Itemized (use Schedule A) ........... , ▲ , ▲ 5,385.00 . ▲ , ▲ 15,385.00 , ▲ . ▲ party committees including any (ii) Unitemized .................................... , ▲ 2,307.00 , ▲ . ▲ , ▲ 12,307.00 , ▲ . ▲ party organizations not registered (iii) TOTAL of contributions , 7,692.00 , . , 27,692.00 , . ▼ from individuals ....................... ▲ ▲ ▲ ▲ ▲ ▲ with the FEC. As noted earlier in (b) (c) Political Party Committees ................. Other Political Committees , ▲ , ▲ 0.00 . ▲ , ▲ , ▲ 0.00 . ▲ , 6,260.00 , . , 14,260.00 , . the chapter, these contributions (such as PACs) ................................... ▲ ▲ ▲ ▲ ▲ ▲ , 1,200.00 , . , 4,000.00 , . must be itemized on a Sched- (d) The Candidate .................................... ▲ ▲ ▲ ▲ ▲ ▲ (e) TOTAL CONTRIBUTIONS (other than loans) ule A for this Line, regardless (add Lines 11(a)(iii), (b), (c), and (d)) .. , ▲ 22,844.00 , ▲ . ▲ , ▲ 45,952.00 , ▲ . ▲ of amount. 104.3(a)(3)(iii). 12. TRANSFERS FROM OTHER AUTHORIZED COMMITTEES .................... , ▲ , ▲ 4,900.00 . ▲ , ▲ 6,000.00 , ▲ . ▲ 13. LOANS: Line 11(c). Contributions from (a) Made or Guaranteed by the Candidate ............................................ , ▲ 71,000.00 , ▲ . ▲ , ▲ 76,000.00 , ▲ . ▲ Other Political Committees (b) (c) All Other Loans................................... TOTAL LOANS , ▲ , ▲ 0.00 . ▲ , ▲ , ▲ 0.00 . ▲ (add Lines 13(a) and (b)) .................... , ▲ 71,000.00 , ▲ . ▲ , ▲ 76,000.00 , ▲ . ▲ On Line 11(c), enter the total 14. OFFSETS TO OPERATING amount of contributions from EXPENDITURES (Refunds, Rebates, etc.) ............................ , ▲ , ▲ 0.00 . ▲ , ▲ , ▲ 0.00 . ▲ other political committees (such 15. OTHER RECEIPTS (Dividends, Interest, etc.) ........................... , , 750.00 . , 1,400.00 , . ▲ ▲ ▲ ▲ ▲ ▲ as PACs or other candidates’ com- 16. TOTAL RECEIPTS (add Lines 11(e), 12, 13(c), 14, and 15) 99,494.00 129,352.00 ▼ , , . , , . mittees) and other such groups not (Carry Total to Line 24, page 4) ............ ▲ ▲ ▲ ▲ ▲ ▲ registered with the FEC, which, as noted earlier in the chapter, must be itemized on a Schedule A for Line 12. Transfers from Other this Line, regardless of amount. 104.3(a)(3)(iv). Authorized Committees Line 11(d). Contributions from Candidate On Line 12, enter the total amount of transfers On Line 11(d), enter the total contributions from the candidate’s other authorized commit- from the candidate. This includes any contribu- tees (if there are any such committees) which, as tions from the candidate that were itemized noted earlier in the chapter, must be itemized on on Schedule A for this Line, as well as any con- a Schedule A for this Line, regardless of amount. tributions that did not have to be itemized. If the contribution is derived from an underlying Line 13. Loans loan to the candidate from a lending institu- tion, or from an advance from the candidate’s Line 13(a). Loans Made or Guaranteed by the Candidate brokerage account, credit card or line of credit, On Line 13(a), enter the total amount of loans report the underlying loan on Schedule C-1. made or guaranteed by the candidate which, as noted earlier in the chapter, must be itemized on a Schedule A for this Line, regardless of amount. 111 Chapter 13 DETAILED SUMMARY PAGE (CONTINUED) Line 15. Other Receipts On Line 15, enter the total amount DETAILED SUMMARY PAGE of any other receipts—both item- FEC Form 3 (Revised 02/2003) of Disbursements Page 4 ized and unitemized—included II. DISBURSEMENTS COLUMN A Total This Period COLUMN B Election Cycle-to-Date for the reporting period. Note 6,010.00 14,054.00 that the type of receipts included 17. OPERATING EXPENDITURES ..................... , ▲ , ▲ . ▲ , ▲ , ▲ . ▲ 18. TRANSFERS TO OTHER here may vary widely (e.g., from , , 0.00 . , , 0.00 . AUTHORIZED COMMITTEES ..................... ▲ ▲ ▲ ▲ ▲ ▲ dividends to certain sales of 19. LOAN REPAYMENTS: (a) Of Loans Made or Guaranteed by the Candidate ................................. , ,5,271.18 . , 6,271.18 , . campaign assets). Remember that ▲ ▲ ▲ ▲ ▲ ▲ (b) Of All Other Loans .............................. , ▲ , ▲ 0.00 . ▲ , ▲ , ▲ 0.00 . ▲ those receipts aggregating over (c) TOTAL LOAN REPAYMENTS (add Lines 19(a) and (b)) ..................... , ▲ 5,271.18 , ▲ . ▲ , ▲ 6,271.18 , ▲ . ▲ $200 from any source during the 20. REFUNDS OF CONTRIBUTIONS TO: (a) Individuals/Persons Other election cycle must be itemized , , 0.00 . , , 0.00 . Than Political Committees .................. ▲ ▲ ▲ 0.00 ▲ ▲ ▲ on a Schedule A for this Line. (b) Political Party Committees .................. , ▲ , ▲ . ▲ , ▲ , ▲ 0.00 . ▲ (c) Other Political Committees (such as PACs) .................................... , 5,000.00 , . , 10,000.00 , . Line 17. Operating ▲ ▲ ▲ ▲ ▲ ▲ (d) TOTAL CONTRIBUTION REFUNDS (add Lines 20(a), (b), and (c)).............. , ▲ 5,000.00 , ▲ . ▲ , ▲ 10,000.00 , ▲ . ▲ 21. OTHER DISBURSEMENTS ......................... , ▲ , ▲ 2,000.00 . ▲ , ▲ 4,000.00 , ▲ . ▲ Expenditures 22. TOTAL DISBURSEMENTS , 12,281.18 , . , 34,325.18 , . On Line 17, enter the total amount ▼ (add Lines 17, 18, 19(c), 20(d), and 21) ▲ ▲ ▲ ▲ ▲ ▲ of disbursements for operating III. CASH SUMMARY expenditures—both itemized , 5,3676.31 , . 23. CASH ON HAND AT BEGINNING OF REPORTING PERIOD ............................................... ▲ ▲ ▲ and unitemized—made during 99,494.00 24 TOTAL RECEIPTS THIS PERIOD (from Line 16, page 3) ..................................................... , ▲ , ▲ ▲. the reporting period. Remember 25. SUBTOTAL (add Line 23 and Line 24) .................................................................................. , ▲ 104,861.81 , ▲ ▲. that these disbursements must 26. TOTAL DISBURSEMENTS THIS PERIOD (from Line 22) ...................................................... , 18,281.18 , . be itemized when they aggregate ▲ ▲ ▲ over $200 to any one source dur- 86,580.13 27. CASH ON HAND AT CLOSE OF REPORTING PERIOD , , . (subtract Line 26 from Line 25).............................................................................................. ▲ ▲ ▲ ing the election cycle. Therefore, the amount entered on this Line will not match the amount totaled on Schedule B for Line 17, which includes only itemized expendi- Line 13(b). All Other Loans tures (unless the committee chooses to itemize On Line 13(b), enter the total of all other expenditures that it is not required to itemize). loans (i.e., those not made or guaranteed by the candidate) the committee received during Line 18. Transfers to Other the reporting period which, as noted earlier Authorized Committees in the chapter, must be itemized on a Sched- ule A for this Line, regardless of amount. On Line 18, enter the total amount of transfers made to the candidate’s other authorized commit- tees (if any such committees exist). As noted ear- Line 14. Offsets to Operating lier in the chapter, such transfers must be itemized Expenditures on a Schedule B for this Line, regardless of amount. On Line 14, enter the total amount of offsets to operating expenditures (such as refunds or rebates) received during the reporting period. The figure might include unitemized offsets as well as itemized offsets, which, as noted ear- lier, are listed on a Schedule A for this Line. 112 Completing FEC Reports Line 19. Loan Repayments must be itemized regardless of amount, the refunds will have to be itemized as well. Line 19(a). Repayments on Loans Made or Guaranteed by the Candidate Line 21. Other Disbursements On Line 19(a), enter the total of repayments On Line 21 enter the total of all other disburse- of principal of loans made or guaranteed by ments—itemized and unitemized—made during the candidate. Such payments of principal must the reporting period. Note that this Line may be itemized on a Schedule B for this Line, contain a wide array of disbursements. Remember regardless of amount. As noted earlier in the that disbursements aggregating over $200 to chapter, payments of interest are considered the same payee during the election cycle must operating expenditures, not repayments on be itemized on a Schedule B for this Line. loans (see Section 17, “Reporting Loans”). Line 19(b). Repayments on All Other Loans Line 23. Beginning Cash on Hand On Line 19(b), enter the total of repayments of A committee must report the cash on hand principal of all loans not made or guaranteed it possessed at both the beginning of the by the candidate. Such payments of principal reporting period and the close of the report- must be itemized on a Schedule B for this Line, ing period. Note that the closing cash balance regardless of amount. As noted earlier in the for the current reporting period appears on chapter, payments of interest are considered the next report as the beginning cash on hand. operating expenditures, not repayments on Cash on hand includes petty cash, funds held loans (see Section 17, “Reporting Loans”). in checking and savings accounts, traveler’s checks, certificates of deposit, treasury bills and Line 20. Refunds of Contributions other investments valued at cost. 104.3(a)(1). Line 20(a). Refunds of Contributions to First Report Individuals/Persons Other Than Political Beginning cash on hand—i.e., money that the Committees (i.e., Individuals and Other committee had in its possession at the time Groups That Are Not Political Committees) of registration—is subject to the contribution On Line 20(a), enter the total amount of contribu- limit, prohibitions and disclosure requirements tions refunded to individuals or groups (other than of federal law. (The committee must exclude political committees). Remember that contribution any contributions that are not permissible refunds need only be itemized (on a Schedule under federal law.) If the beginning cash-on- B) if the original contributions were itemized hand balance is not $0, then the committee (on a Schedule A). (See Section 19, “Report- must itemize, as memo entries on Schedule A, ing Refunds, Returns and Bounced Checks”.) contributions and other receipts included in the beginning cash-on-hand balance. (See Section 5 Line 20(b). Refunds to Political Party Committees of this chapter, “When to Itemize Receipts.”) On Line 20(b), enter the total amount of contributions refunded to political party com- Line 24. Total Receipts This Period mittees. Remember that, since these contribu- Enter the total receipts figure from Line tions must be itemized regardless of amount, 16 of the Detailed Summary Page. the refunds will have to be itemized as well. Line 20(c). Refunds to Other Political Committees Line 26. Total Disbursements On Line 20(c), enter the total amount of contri- This Period butions refunded to other political committees Enter the amount of total disbursements from (i.e., other than political party committees). Line 22 of the Detailed Summary Page. Remember that, since these contributions 113 Chapter 13 Line 27. Cash On Hand at 24. Post-Election Detailed Close of Reporting Period Summary Page Subtract the total disbursements for the period (Line 26) from the subtotal (entered on Line 25) In election years, the reporting period for the of beginning cash on hand for the reporting period Post-General (or, in cases where the candidate (Line 23) and the total receipts for the reporting was not a candidate in the general election, the period (Line 24) to derive the closing cash-on-hand Year-End) report will span two election cycles. balance. (In other words, (Beginning Cash on Hand For this report only, committees must not use + Total Receipts for Reporting Period) – (Total the normal Detailed Summary Page; instead, Disbursements for Reporting Period = Closing they must use the Post-Election Detailed Sum- Cash on Hand.) Note that for the next report, mary Page. This form divides the post-election this amount must be entered on Line 23 (Cash reporting period into two time frames: On Hand At Beginning Of Reporting Period). • From the beginning of the reporting period through the date of the election; and • From the day after the election to the end of the reporting period. (See example.) The campaign must divide its records into those two time peri- ods in order to fill out the form. POST ELECTION DETAILED SUMMARY PAGE Campaigns that do not participate in the general election must file the Post-Election Detailed Summary POST-ELECTION DETAILED SUMMARY PAGE Report of Receipts and Disbursements Page with their election-year year- FEC Form 3 (Revised 07/05) • If the candidate participated in the general election, use this form for the 30-day Post-General report. Page 5 end report. Committees involved • If the candidate did NOT participate in the general election, use this form for the Year-end report covering through December 31 of the election year (due on January 31). in a special general election must This form is used in lieu of ﬁlling out Line Numbers 6 through 7 on Page 2 (Summary Page) and Pages 3 and 4 (the Detailed Sum- mary Page) for the last report ﬁled by a candidate during the current election cycle. also file the Post-Election Detailed Write or Type Committee Name Doe for Congress Committee Summary Page with any Special Post-General report required. 10 18 2012 11 26 2012 M M / D D / Y Y Y Y M M / D D / Y Y Y Y Report Covering the Period: From: To: Electronic filers must file this I. RECEIPTS form electronically, and thus must COLUMN A Total this Period COLUMN B Election Cycle Total as of COLUMN C Total for ensure that their filing software is 11 06 2012 11 07 2012 able to generate this form, or use M M / D D / Y Y Y Y M M / D D / Y Y Y Y (date of general election) (date after general election) 11. CONTRIBUTIONS through FECFile. Paper filers may download (other than loans) FROM: (a) Individuals/Persons Other than 11 M M / 26 D D / Y 2012 Y Y Y this form from http://www.fec. gov/info/forms.shtml#candidates. Political Committees (last day of reporting period) (i) Itemized (use Schedule A) , ▲ 10,385.00 , ▲ . ▲ , ▲ 108,680.00 , ▲ . ▲ , ▲ 4,600.00 , ▲ . ▲ (ii) Unitemized , ▲ 2,500.00 , ▲ . ▲ (iii) Total of contributions from individuals , ▲ 12,005.00 , ▲ . ▲ , ▲ , ▲ 275.00 . ▲ 25. The Summary , ▲ 12,885.00 , ▲ . ▲ , ▲ 120,685.00 , ▲ . ▲ , ▲ 4,875.00 , ▲ . ▲ Page (b) Political Party Committees , ▲ , ▲ 50.00 . ▲ , ▲ 5,050.00 , ▲ . ▲ , ▲ , ▲ 0.00 . ▲ After completing the Detailed Sum- (c) Other Political Committees mary Page, totals from that page , ▲ 16,000.00 , ▲ . ▲ , ▲ 65,000.00 , ▲ . ▲ , ▲ 1,000.00 , ▲ . ▲ and from Schedules C and D are used to complete the Summary Page (see example opposite and on page 116), as indicated below: 114 Completing FEC Reports Line 1. Name and Address SUMMARY PAGE Fill in the committee’s full name and mailing address. If the address has changed, be sure to FEC REPORT OF RECEIPTS AND DISBURSEMENTS check the appropriate box. FORM 3 For An Authorized Committee Ofﬁce Use Only 1. NAME OF TYPE OR PRINT ▼ Example: If typing, type 12FE4M5 COMMITTEE (in full) over the lines. Line 2. ID Number Doe for Congress Committee Enter the committee’s FEC iden- 319 Main Street ADDRESS (number and street) tification number on Line 2. If the ▼ Check if different committee is filing its first report, than previously reported. (ACC) Springﬁeld VA 00000 it may not yet have received an ID ▼ ▼ ▼ 2. FEC IDENTIFICATION NUMBER ▼ CITY STATE ZIP CODE STATE ▼ DISTRICT number; in that case the commit- C 00033000 3. IS THIS X NEW AMENDED REPORT (N) OR (A) VA 12 tee should leave this space blank. 4. TYPE OF REPORT (Choose One) (b) 12-Day PRE-Election Report for the: A committee should include its (a) Quarterly Reports: Primary (12P) General (12G) Runoff (12R) X ID number in all reports, state- April 15 Quarterly Report (Q1) Convention (12C) Special (12S) July 15 Quarterly Report (Q2) ments, notices and other written October 15 Quarterly Report (Q3) M M / D D / Y Y Y Y in the Election on State of communications with the FEC. January 31 Year-End Report (YE) (c) 30-Day POST-Election Report for the: General (30G) Runoff (30R) Special (30S) Line 3. Original or Termination Report (TER) Election on M M / D D / Y Y Y Y in the State of Amended Report 5. Covering Period M 01 M / 01 D D / Y 2012 Y Y Y through 03 M M / 31 D D / Y 2012 Y Y Y Check “amended” only when I certify that I have examined this Report and to the best of my knowledge and belief it is true, correct and complete. amending a report that has Type or Print Name of Treasurer Gottlob Frege already been filed with the FEC; Signature of Treasurer Gottlob Frege Date 04 M M / 10 D D / Y 2012 Y Y Y otherwise, check “new.” NOTE: Submission of false, erroneous, or incomplete information may subject the person signing this Report to the penalties of 2 U.S.C. §437g. Ofﬁce Use FEC FORM 3 Only (Revised 02/2003) Line 4. Type of Report Check the appropriate box and, if necessary, fill in the appropri- ate information (for 12-day On Line 6(b), enter the amount of refunds from pre-election, 30-day post-election, special Line 20(d) of the Detailed Summary Page. election reports and termination reports). Line 7. Net Operating Expenditures Line 5. Coverage Dates On Line 7(a), enter the amount of total The period covered by the report begins on the operating expenditures from Line 17 day after the close of books of the last report filed of the Detailed Summary Page. by the committee. If the report is the first one filed On Line 7(b), enter the amount of total by the committee, then the reporting period begins offsets to operating expenditures from with the date of the committee’s first activity. Line 14 of the Detailed Summary Page. Line 6. Net Contributions Line 8. Cash on Hand at Close (Other Than Loans) of Reporting Period On Line 6(a), enter the amount of total On Line 8, enter the amount of cash on hand contributions other than loans from Line at the close of the reporting period from 11(e) of the Detailed Summary Page. Line 27 of the Detailed Summary Page. 115 Chapter 13 “signature.” See Chapters 2, 11 SUMMARY PAGE (CONTINUED) and 12 for more information on the treasurer’s responsibilities. SUMMARY PAGE of Receipts and Disbursements 26. Filing FEC Form 3 (Revised 02/2003) Page 2 Write or Type Committee Name Doe for Congress Committee Report Covering the Period: From: 01 M M / 01 D D / Y 2012 Y Y Y To: 03 M M / 31 D D / Y 2012 Y Y Y Amendments COLUMN A This Period COLUMN B Election Cycle-to-Date The committee must file 6. Net Contributions (other than loans) an amended report if it: (a) Total Contributions (other than loans) (from Line 11(e)) .... , 22.844.00 , . , 45,952.00 , . • Discovers that an earlier report ▲ ▲ ▲ ▲ ▲ ▲ (b) Total Contribution Refunds , 5,000.00 , . , 10,000.00 , . (from Line 20(d)) .................................. ▲ ▲ ▲ ▲ ▲ ▲ contained erroneous information; or 17,844.00 35,952.00 (c) Net Contributions (other than loans) , , . , , . (subtract Line 6(b) from Line 6(a)) ...... ▲ ▲ ▲ ▲ ▲ ▲ • Does not obtain all the required 7. Net Operating Expenditures (a) Total Operating Expenditures information about a particular , 6,010.00 , . , 14,054.50 , . (from Line 17) ...................................... ▲ ▲ ▲ ▲ ▲ ▲ itemized receipt or disburse- ment in time to include it in (b) Total Offsets to Operating Expenditures (from Line 14) ................ , ▲ , ▲ 0.00 . ▲ , ▲ , ▲ 0.00 . ▲ (c) Net Operating Expenditures (subtract Line 7(b) from Line 7(a)) ...... , ▲ 6,010.00 , ▲ . ▲ , ▲ 14,054.50 , ▲ . ▲ the appropriate report. 8. Cash on Hand at Close of , 86,580.13 , . Paper Filers Reporting Period (from Line 27) ................. ▲ ▲ ▲ 9. Debts and Obligations Owed TO 0.00 the Committee (Itemize all on Schedule C and/or Schedule D) ................ , ▲ , ▲ . ▲ 10. Debts and Obligations Owed BY When filing an amended Form 3, the Committee (Itemize all on Schedule C and/or Schedule D) ................ , ▲ 70,678.82 ▲, . ▲ the committee should complete the Summary Page (including the For further information contact: treasurer’s signature), indicat- Federal Election Commission 999 E Street, NW ing on Line 3 that the docu- Washington, DC 20463 Toll Free 800-424-9530 ment is an amended report. Local 202-694-1100 In addition to the Summary Page (Pages 1 and 2 of Form 3), the committee should file a cor- Line 9. Debts Owed to Committee rected version of the schedule that contained On Line 9, transfer the total amount the incomplete or incorrect itemized informa- owed to the committee from the appro- tion in the earlier report, along with a revised priate Schedule C and/or D. Detailed Summary Page (Pages 3 and 4 of Form 3), if appropriate. Transactions originally reported Line 10. Debts Owed by Committee correctly do not need to be itemized again. The Commission recommends that the treasurer On Line 10, transfer the total amount attach a cover letter explaining the change. owed by the committee from the appro- priate Schedule C and/or D. Electronic Filers Treasurer’s Name and Signature Electronic filers must electronically resubmit the entire report, not just the amended por- The treasurer must sign and date Form 3 tions. The committee must check the amend- at the bottom of the Summary Page. Only a ment box on the new report before filing. The treasurer or assistant treasurer designated on amendments must be formatted to comply with Form 1 (Statement of Organization) may sign the Electronic Filing Specifications Require- the report. 104.14(a). In the case of electronic ments mentioned in Chapter 12. 104.18(f). filers, the treasurer’s password serves as the 116 Winding Down the Campaign ChAPTEr 14 Winding Down the Campaign This chapter explains the requirements for an of debt retirement (See “Retiring Debts” authorized committee that wishes to close and “Settling Debts” below); and down its operations at the end of a campaign.1 • The purposes for which any remaining commit- tee funds or assets will be used. (See Chapter 8, “Expenditures and Other Uses of Campaign 1. Terminating the Committee Funds;” see also “Winding Down Costs” and “Sale of Campaign Assets,” below.) 102.3(a). Eligibility Committee No Longer Required A committee may file a termination report at any time, provided that: to Report Once Notified The committee’s reporting obligation ends only • The committee no longer intends to receive when the Commission notifies the committee contributions, make expenditures or make in writing that the termination report has been any disbursements that would otherwise accepted. Until the committee receives this qualify it as a political committee; and notification, it must continue to file reports. • Neither the committee seeking to ter- minate nor any other authorized com- Administrative Termination mittee of the same candidate has any outstanding debts or obligations. The FEC, upon its own initiative or at the request of a political committee, may admin- 102.3 and 116.1. Campaigns with debts istratively terminate a committee’s reporting or obligations should see “Retiring status. For details on administrative termina- Debts” and “Settling Debts,” below. tion, consult section 102.4 of the regulations. A committee involved in an FEC enforcement action, an FEC audit or litigation with the FEC, however, must continue to file regularly sched- 2. Conversion to Multicandidate uled reports until the matter is resolved. Committee Termination Report In past advisory opinions, the Commission has When filing the committee’s termination report, explicitly permitted a principal campaign com- the treasurer must check the “Termination mittee to become a multicandidate committee Report” box on Line 4 of the Summary Page of as an alternative to the committee’s termination. Form 3. The termination report must disclose: In meeting the requirements for multicandidate status, a former principal campaign committee • All receipts and disbursements not previ- may avail itself of the length of time of its prior ously reported, including an accounting registration, the number of contributions it has 1 If a candidate wishes to use the committee for made in the past and the number of contribu- a subsequent federal campaign, he or she may tions it has received. Note that the prohibition on redesignate it as an authorized committee using FEC Form 2. See Chapter 2, “Candidate and converting campaign funds to personal use still Committee Registration,” for more information. applies to such a committee. See AOs 2004-03, 117 Chapter 14 1988-41 and 1985-30 and the Campaign Guide for • Any other lawful purpose, unless such Nonconnected Committees for more information. use is personal use under 113.1(g). (See Chapter 8, Section 2, “Personal Use of Campaign Funds.”) 113.2(e). 3. Winding Down Costs Campaign funds may be used to pay ordinary and 4. Sale of Campaign Assets necessary expenses incurred in connection with one’s duties as a federal officeholder. Such expenses include the costs of winding down the office of Purchaser Makes Contribution a former federal officeholder for a period of six Generally, when a campaign sells its property, months after he or she leaves office. 113.2(a)(2). the purchase is considered a contribution to the Winding down costs include: campaign by the purchaser. The payment, there- • Moving Expenses. A retiring federal office- fore, must not come from prohibited sources holder may use campaign funds to pay for and must not exceed the contribution limits. the expenses of moving office and personal Sale of Campaign Materials furnishings from the Congressional office in Washington, D.C., back to the officeholder’s The sale of fundraising items or materials devel- home state. While the costs of transporting oped uniquely for the committee (such as artwork, an officeholder’s personal household effects publications and opinion polls2) results in contribu- and furnishings from Washington, D.C., to the tions from the purchasers. 100.53. See also, for officeholder’s home state are not “winding example, AOs 1982-24 and 1980-19. (However, down costs,” such costs are “ordinary and note the exception for mailing lists, below.) necessary expenses” incurred in connection Commercial Ventures with ending his or her duties as a federal officeholder. AO 1996-14. See also AO 1996-44. The Commission has determined that when a All such moving expenses should be reported committee asset is sold or used for an ongoing as “other disbursements” by the officeholder’s commercial venture to produce revenue for a com- committee, with specific payee(s) and pur- mittee, the proceeds are considered contributions pose noted. 104.3(b)(2)(vi) and (b)(4)(vi). to the committee. See AOs 1991-34 and 1983-02. • Payments to Committee Staff. See AOs 1976-90 and 1978-43. Purchaser Does Not Make Contribution • Gifts. Campaign funds may be used to pur- Under limited circumstances, however, the sale of chase gifts or make donations of nominal a campaign asset does not result in a contribution. value to persons other than the members Mailing Lists of the candidate’s family. 113.1(g)(4). Mailing lists developed by a campaign for its own See also AO 2008-04. use may be sold at the “usual and normal” charge • Other permissible uses of excess without the purchaser making a contribution. See, campaign funds include: for example, AOs 2002-14, 1982-41 and 1981-53. • Donations to charitable organizations Liquidation of Equipment and Supplies defined in 26 U.S.C. §170(c). 113.2(b); The Commission has said that the sale of • Unlimited transfers to any national, state or campaign equipment and supplies does local political party committee. 113.2(c); not result in a contribution under certain • Donations to state and local candidates, conditions. AOs 2003-19 and 1986-14. pursuant to state law. 113.2(d); and 2 For more information on opinion polls, see Commission regulations at 106.4. 118 Winding Down the Campaign tee has no outstanding debts. 116.2(c)(2). See 5. retiring Debts Chapter 9, “Transfers.” See also AO 1997-10. Through Contributions Salary Owed to Campaign Staff When raising contributions to retire Unpaid salary or wages owed to campaign employ- debts after the election is over, a campaign ees are not considered contributions from those must remember three general rules:3 employees. Uncompensated services rendered by an employee may be converted to volunteer work, • First, the contributions are still subject to or the amount owed may be treated as a debt, as the limits and prohibitions of the Federal explained below. 116.6(a). Note, however, that FEC Election Campaign Act (the Act), even if the rules do not require an employee to accept less candidate lost the election and does not than full payment for his or her services. 116.6(b). plan to run for future federal office. • Second, contributions made after an elec- Treatment as Volunteer Service tion to retire debts must, in most cases, be Uncompensated employee service may be specifically designated for that election by the considered volunteer service if the employee contributor. See “Designated and Undesig- signs a statement agreeing to the arrange- nated Contributions,” Chapter 4, Section 4. ment. 116.6(a). (Services performed by • Finally, contributions designated for, but volunteers are exempt from limits and made after, a particular election may not reporting requirements. See Chapter 7.) exceed the campaign’s net debts out- Treatment as Debt standing, as explained in Chapter 4. Alternatively, the committee may treat the unpaid 110.1(b)(3)(i).4 amount of salary as a debt to the employee (see Chapter 13 for reporting information). The com- Through Sale of Assets mittee and the employee may settle the debt A campaign may sell its assets to raise for less than the amount owed, using the proce- funds to retire debts. Please note that the dures described in the next section. 116.6(b). sale or use of assets to retire debts may result in contributions from the purchas- ers, as explained in Section 4, above. 6. Settling Debts Through Transfers Eligibility for Debt Settlement A campaign may receive funds to retire debts through transfers of excess funds from the Only a terminating committee may settle a same candidate’s federal campaign for a different debt for less than the full amount owed to election cycle, as long as the transferor commit- the creditor. A “terminating committee” is one that does not intend to raise contributions or 3 A campaign may raise funds to retire debts make expenditures—except for the purposes through joint fundraising. See Appendix C. of paying winding-down costs and retiring its 4 The Commission has ruled that a federal officeholder debts. 116.1(a) and 116.2(a). An authorized com- may solicit, receive and expend both federally mittee may not settle any debts if any other permissible funds, as well as funds that do not authorized committee of the same candidate comply with the Act, in order to retire existing debt incurred by a previous nonfederal campaign, has enough permissible cash on hand to pay so long as the fundraising is solely in connection all or part of the debt. 116.2(c)(1) and (2). with the nonfederal campaign, refers only to the candidate or to other candidates for that same nonfederal office and is permitted under state law. AO 2007-01. See also AO 2009-06. 119 Chapter 14 Debts Subject to Settlement may be considered a contribution subject to limits and source prohibitions (i.e., prohibited The types of debts that are subject to if the vendor is incorporated). 114.2(b). debt settlement requirements include: • Amounts owed to commercial vendors; Debt Settlement Plans • Debts arising from advances by indi- After a terminating committee has reached agree- viduals (e.g., staff using personal funds ments with its creditors, the treasurer must file or credit to purchase goods and ser- a debt settlement plan on FEC Form 8. Once the vices on behalf of the committee); plan has been submitted to the Commission for • Salary owed to committee employees; and review, the committee must postpone payment on • Debts arising from loans from politi- the debt until the Commission has completed the cal committees or individuals, includ- review. 116.7(a). Payments to creditors must be ing candidates. 116.7(b). disclosed in the committee’s termination report. The debt settlement rules do not apply Completing Form 8 to disputed debts, which are covered by Step-by-step instructions for completing Form other rules (see below). 116.7(c)(2). 8 are included with the form. The Commission They also do not apply to bank loans, though the recommends that the committee include as Commission recognizes that under extraordinary many debts as possible in the plan and submit a circumstances, such as the death or bankruptcy separate Part II (second page) for each creditor of the candidate, settlement of bank loans may along with Part I (cover page). The treasurer must be appropriate. (The Commission will consider also submit Part III (third page) to indicate how specific requests on a case-by-case basis.) the committee intends to address other debts not included in the submission. The treasurer Debt Settlement Rules must sign and date the first page. The creditor must also sign the form to indicate his or her A commercial vendor (incorporated or unincor- acceptance of the settlement. As an alternative, porated) may forgive or settle a debt owed by a the treasurer may attach a signed statement from committee without incurring a contribution if: the creditor containing the same information. • Credit was initially extended in the ven- dor’s ordinary course of business, and the Reporting Debts Undergoing Settlement terms of the credit were similar to those Debts undergoing settlement must be continuously observed by the vendor when extending a reported until the Commission has completed its similar amount of credit to a nonpolitical review of the committee’s debt settlement plan. client of similar risk. 116.3 and 116.4(d)(1); The committee may file a termination report once • The committee undertook all reasonable all debts have been paid, settled, forgiven or other- efforts to satisfy the outstanding debt, such wise extinguished. 116.4(f), 116.5(e) and 116.6(c). as fundraising, reducing overhead costs Disputed Debts and liquidating assets. 116.4(d)(2); and A disputed debt is a bona fide disagreement • The vendor made the same efforts to col- between the creditor and the committee as to lect the debt as those made to collect the existence of a debt or the amount owed by debts from a nonpolitical debtor in similar the committee. When filing a debt settlement circumstances. Remedies might include, for plan, a terminating committee must describe any example, late fee charges, referral to a debt disputed debts and the committee’s efforts to collection agency or litigation. 116.4(d)(3). resolve them on Part III of Form 8. 116.10(b). If the committee or the creditor fails to take these steps, the difference between the amount owed and the amount actually paid 120 Winding Down the Campaign Creditor’s Rights Notification to Commission No commercial vendor or other credi- A creditor who intends to forgive a debt owed tor is required to forgive or settle debts by an ongoing committee must notify the owed by committees. 116.4(e). Commission of its intent in writing. The let- ter must provide the following information: Assigning Debts to Another Committee • The terms of the initial extension of To expedite termination, an authorized com- credit and a description of the terms mittee that qualifies as a terminating committee under which the creditor has extended and has no remaining cash on hand may assign credit to similar nonpolitical debtors; its debts to another authorized commit- • A description of the campaign’s tee of the same candidate, provided that: efforts to satisfy the debt; • The committee transferring the • A description of the steps taken by the credi- debts was organized for an elec- tor to obtain payment, along with a comparison tion that has already been held; of those remedies with others pursued by the • Within 30 days before the assignment takes creditor under similar circumstances; and effect, the transferor committee notifies each • An indication that the creditor has creditor in writing of the name and address forgiven other debts involving nonpoliti- of the committee assuming the debts; and cal debtors in similar circumstances. • The committee assuming the debts 116.8(b). notifies the FEC in writing that it has assumed the obligation to pay the debts. Commission Review That committee must continue to report The Commission will review each pro- the debts until they are retired. posal to forgive a debt to ensure that the 116.2(c)(3). creditor, the ongoing committee and the candidate have complied with the Act’s con- tribution limits and prohibitions. 116.8(c). Forgiveness of Debts Owed by Ongoing Committees Forgiveness Rules A creditor may forgive a debt owed by an ongoing committee (that is, one that does not qualify as a terminating committee) if the debt has been outstanding at least 24 months and: • The ongoing committee (1) has insufficient cash on hand to pay the debt, (2) has had receipts of less than $1,000 and disbursements of less than $1,000 during the previous 24 months and (3) owes debts to other creditors of such magnitude that the creditor could reasonably conclude that the ongoing com- mittee will not pay its particular debt; or • The creditor is unable, after reasonable diligence, to locate the ongoing committee. 116.8(a). 121 122 Earmarked Contributions Appendix A • An employee or full-time volunteer working for a candidate committee; Earmarked • An individual who occupies a significant position in a candidate’s campaign and Contributions who is expressly authorized to raise money on behalf of the candidate; • A committee affiliated with the An earmarked contribution is one which the candidate committee; and contributor directs (either orally or in writing) to a clearly identified candidate or the candidate’s • A commercial fundraising firm retained by authorized committee through an intermediary the candidate committee. 110.6(b)(2)(i). or conduit. Earmarking may take the form of a designation, instruction or encumbrance and may Prohibitions Apply be direct or indirect, express or implied, written or No corporation, labor organization or other oral. 110.6(b)(1). Earmarked contributions require entity prohibited from making contributions additional disclosure, as summarized below. in connection with federal elections may act In addition, under the provisions of the Honest as a conduit for an earmarked contribution. Leadership and Open Government Act of 2007 A nonconnected committee or a separate (HLOGA), Pub. Law No. 110-81, 121 Stat. 735, segregated fund (SSF), however, may act as a signed into law September 14, 2007, certain conduit. 110.6(b)(2)(ii) and 114.2(f)(3)(ii). “bundled” contributions may trigger additional Furthermore, no individual may receive a con- disclosure of the identity of the person who raised tribution on behalf of a candidate (as a conduit the bundled contribution as summarized in section or otherwise) while acting as the representa- 6 of this Appendix. See also Appendix F, “Lobbyist tive of a corporation, labor organization or Bundled Contributions” for further information. other entity prohibited from making contribu- tions. 110.6(b)(2)(i)(A) and (E) and 114.2(f). 1. Earmarked Contributions 2. Effect on Contribution Limits Conduit/Intermediary Anyone who receives and forwards an earmarked Contributor’s Limit contribution to a candidate or candidate’s An earmarked contribution counts against authorized committee is considered a conduit or the contributor’s contribution limit for intermediary. 110.6(b)(2). (The terms “conduit” the recipient candidate. 110.6(a).1 and “intermediary” are interchangeable; “conduit” will be used in the remainder of this appendix.) Individuals, political committees, unregis- tered committees and partnerships may act 1 In AO 2008-08, the Commission ruled that an as conduits for earmarked contributions. earmarked contribution sent by an individual through a nonconnected political action committee (PAC) is considered “made” when the contributor gives Persons Not Considered Conduits the money to the nonconnected PAC, not when the committee eventually forwards the contribution to For the purposes of the earmarking rules, the final recipient. Thus, a contribution earmarked certain individuals and organizations are through a nonconnected PAC in 2011 will be subject to the 2011 calendar-year contribution limit and not considered conduits even though they count against the contributor’s 2011-2012 biennial may participate in activities to raise money limit, even if the contribution is not forwarded to for a candidate. These persons include: the intended recipient until a later election cycle. 123 Appendix A Conduit’s Limit the SSF exercised direction or control over the choice of recipient. 114.2(f)(2)(iii) and (f)(4)(iii). Direction or Control The conduit’s limit is affected when the conduit exercises direction or control over the contribu- 3. Forwarding Earmarked tor’s choice of recipient candidate (see “Contribu- Contributions tions Earmarked Through SSF,” below). In that case, the full amount of the contribution counts against the limits of both the original contribu- 10-Day Limit tor and the conduit, even though the candidate receives only one check. 110.6(d). For examples The conduit must forward an earmarked of how the Commission has viewed the “direc- contribution, along with a report (see tion or control” rule in specific situations, see below) to the recipient candidate commit- AOs 2003-23, 1986-04, 1981-57 and 1980-46. tee within 10 days of receiving the contribu- tion. 102.8(a) and (c) and 110.6(c)(1)(iii). Effect on Unregistered Organization An unregistered organization acting as a conduit should be aware that conduit activity could result 4. Transmittal to Campaign in a contribution by the organization, under the circumstances described above. In such a case, Along with the funds, the conduit must for- the activity may trigger registration require- ward to the recipient candidate committee a ments for the unregistered organization. transmittal report containing information that the candidate’s campaign committee will need Contributions Earmarked Through SSF for its own records and reports. 110.6(c)(1). Unsolicited Contributions Exceeding $50 As discussed in Section 1, a corporation or When an earmarked contribution exceeds $50, the labor organization may never act as a conduit accompanying transmittal report must contain the for earmarked contributions. A corporation name and mailing address of the original contribu- or labor organization’s SSF, however, may col- tor, the date the contribution was received by the lect and forward earmarked contributions. An conduit and the amount. 102.8(a) and 110.6(c)(1) unsolicited earmarked contribution, transmitted (iv)(A). The report should also state the election to a candidate through the SSF, counts against designated by the contributor, if any. 110.1(b)(2). the original contributor’s contribution limits, but it does not count against the limits on the SSF’s own contributions to the candidate. 110.6(d)(1). Contributions Exceeding $200 When an earmarked contribution exceeds $200, Solicited the accompanying report must contain the If, however, the earmarked contribution was name and mailing address of the contributor, the solicited from the restricted class by a com- contributor’s occupation and name of employer, munication from the SSF’s connected organiza- the date the contribution was received by the tion, under 114.3, and was collected by the SSF, conduit and the amount. 102.8(a) and 110.6(c) it is considered a contribution to both the SSF (1)(iv). The report should also state the election and the candidate, and from both the individual designated by the contributor, if any. 110.1(b)(2)(i). contributor and the SSF. As such, the earmarked contribution counts against several contribution limits. Note that, under these circumstances, the contribution automatically counts against the SSF’s contribution limits regardless of whether 124 Earmarked Contributions of the Senate) and must, when the contribution is 5. reporting Earmarked forwarded, file a transmittal report by letter with Contributions the recipient authorized committee. 110.6(c)(1)(ii). An earmarked contribution must be reported Contents of Reports by Conduit by both the conduit (political committee or The above reports filed by a conduit must unregistered entity) and the recipient autho- contain the following information: rized committee. The conduit must comply with special reporting rules, which vary depending • The name and mailing address of the on whether the contribution was deposited original contributor and, if the contribution in the conduit’s bank account or was passed is from an individual and exceeds $200, the on directly to the campaign in the form of the contributor’s occupation and employer; original contributor’s check. 110.6(c)(1)(v). • The amount of the earmarked contribution; • The date the contribution was Reports by Political Committee Conduit received by the conduit; A political committee that serves as a conduit • The recipient of the contribution, as of an earmarked contribution must disclose the designated by the contributor; earmarked contribution, regardless of amount, • The date the contribution was for- on two separate reports: the committee’s next warded to the recipient; and regularly scheduled FEC report, and a special transmittal report (mentioned above) sent to the • Whether the contribution was passed on recipient authorized committee. 110.6(c)(1). in cash, by the contributor’s check or by the conduit’s check. Note that if the con- duit is an individual, he or she may deposit Next Regular FEC Report earmarked contributions into a personal The conduit’s next regularly scheduled report must bank account. See 110.6(c)(1)(iv). However, indicate whether the earmarked contribution was: contributions may not be commingled with • Transmitted through the conduit’s the personal funds of any individual. 102.15. account, in which case each contribu- tion must be reported on the report- Report by Recipient Committee ing schedules for itemized receipts and The recipient of an earmarked contribution disbursements (Schedules A and B); or also has a reporting obligation if the earmarked • Transmitted in the form of the original contributions received from a single conduit contributor’s check, in which case each exceed $200 in an election cycle. In that case, on earmarked contribution must be reported Schedule A, the authorized committee must: as a memo entry on Schedules A and B. • Identify the conduit by name and 110.6(c)(1)(iv) and (v). For more information, see address (and occupation and employer Appendix D of the Campaign Guide for Noncon- if the conduit is an individual); nected Committees and Appendix D of the Campaign • Report the date of receipt and total Guide for Corporations and Labor Organizations. amount of earmarked contributions received from that conduit; and Reports by Unregistered Conduit • Itemize the original contributions from each A conduit that is not a registered political commit- individual whose total contributions to the tee (that is, the conduit is an individual, a partner- committee aggregate over $200 per election ship or a group) must, within 30 days of forwarding cycle (including the full name, mailing address, the contribution, file a report by letter with the occupation and employer of the contribu- Federal Election Commission (not the Secretary tor, the amount earmarked and the date the 125 Appendix A conduit received the con- tribution). 110.6(c)(2). (See EARMARKED CONTRIBUTION example at right.) If appropri- ate, the campaign must report SCHEDULE A (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF for each category of the X whether the conduit’s limit ITEMIZED RECEIPTS Detailed Summary Page 11a 12 11b 13a 11c 13b 11d 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions was affected. See 110.6(d)(2). or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) A. Levi-Strauss, Claude Date of Receipt Mailing Address 6. Contributions 5739 Totem St. 03 13 2012 M M / D D / Y Y Y Y City State Zip Code Alexandria VA 00000 Bundled by FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period 1,000.00 , , . Lobbyists/ Name of Employer Alexandria University Receipt For: Occupation Anthropologist Election Cycle-to-Date ▲ Earmarked through ▲ ▲ X registrants and ▼ AnthroPAC Primary General Other (specify) ▼ , ▲ 1,000.00 , ▲ . ▲ Lobbyist PACs Full Name (Last, First, Middle Initial) B. Anthropologists Association PAC (AnthroPAC) Date of Receipt Mailing Address 2321 Origin St. 03 02 15 10 2012 M M / D D / Y Y Y Y City State Zip Code Alexandria VA 00000 Under the provisions of HLOGA, FEC ID number of contributing C 00000002 Amount of Each Receipt this Period federal political committee. additional disclosure is required Name of Employer Occupation ▲ 1000.00 , , ▲ ▲. 1,150.00 MEMO for certain “bundled contribu- Receipt For: Election Cycle-to-Date Total earmarked X ▼ Primary General through conduit. tions.” Bundled contributions Other (specify) ▼ , ▲ 1,150.00 ▲ 2200.00 , . ▲ PAC limit not affected. include contributions collected and forwarded by a lobbyist/ registrant or lobbyist PAC either physically or electronically, as well as contribu- tions for which the lobbyist/registrant or lobbyist PAC receives credit from the recipient authorized committee, through record, designation or other form of recognition. See Appendix F, “Lobbyist Bundled Contributions” for further information. 126 Contributions from Partnerships Appendix B • It has chosen to file, under IRS rules, as a partnership; or Contributions from • It has made no choice, under IRS rules, as to whether it is a corporation or Partnerships1 a partnership. 110.1(g)(2) and (3). Under these conditions, an LLC may make contributions to candidates, sub- Outlined below are special rules concerning con- ject to the rules described in this appen- tributions received from partnerships and from dix. See also Chapter 4, Section 10. limited liability companies taxed as partnerships. 2. Attribution Among Partners 1. Contribution Limits Formula Contributions Made by Partnerships A portion of the partnership contribution must be Contributions received by a candidate’s authorized attributed to each contributing partner.2 If all part- committees from a partnership may not exceed ners within the organization are contributing, the $2,500 per election. In addition, a contribution partnership may attribute the contribution accord- from a partnership also counts proportionately ing to each partner’s share of the firm’s profits. against each participating partner’s own limit with respect to the same candidate. 110.1(b)(1) and (e). However, if the partnership attributes a con- tribution on another basis agreed to by the partners, the following rules must be observed: Contributions Made by • The profits of only the partners to Individual Partners whom the contribution is attributed are Each partner may make contributions of $2,500 reduced (or their losses increased); and per election, per candidate. 110.1(b)(1). Although • The profits (or losses) of those partners are contributions made by the partnership as a whole reduced (or losses increased) in the amount count proportionately against each participating of the contribution attributed to them. partner’s $2,500 limit, contributions made by individual partners from their own funds do not The portion attributed to each partner must not, count against the partnership’s limit. 110.1(e). when aggregated with other contributions from that person, exceed his or her individual contribu- Note, however, that certain partnerships and tion limit. 110.1(e). See also “Partnerships or LLCs partners may be prohibited from contributing. See with Corporate Partners or Members” in the “Prohibited Partnership Contributions,” below. next section, below and AO 2009-02 regarding independent expenditures by single member LLCs. Limited Liability Companies In some cases, limited liability companies Notice to Recipient Committee (LLCs) are treated as partnerships. For the Because a contribution from a partnership is a purposes of contribution limitations and prohibi- joint contribution, the partnership must pro- tions, an LLC is treated as a partnership if: vide to the recipient committee, along with the • It does not have publicly traded shares contribution, a written notice listing the names and 2 A portion of a contribution drawn on a partnership account may not be attributed to 1 For information on contributions from limited the spouse of a partner, unless the spouse is also liability companies, see Chapter 4, Section 10. a member of the partnership. AO 1980-67. 127 Appendix B of the contributing partners and the amount Partnerships or LLCs with Federal to be attributed to each. However, unlike other joint contributions, the signature of each con- Government Contracts tributing partner is not required. 110.1(k)(1). A partnership or LLC that is negotiating a contract with the federal government or that has not com- pleted performance of such a contract is prohibited 3. Prohibited Partnership from making contributions. However, an individual partner in such a firm may make contributions Contributions from personal funds (rather than from funds drawn on the partnership’s account). 115.4. See also AOs 2005-20 and 1991-01 and Chapter 5, Section 1. Professional Corporations Also, an individual, who is, in his or her own right Although law firms, doctors’ practices and or as a sole proprietor, a federal government similar businesses are often organized as partner- contractor or negotiating a contract with the ships, some of these businesses may instead be federal government may not make contributions professional corporations. Unlike a partnership, using any funds (business or personal) under his a professional corporation is prohibited from or her control. 115.5. Note that the spouse of making any contributions because contribu- such an individual is not prohibited from making tions from corporations are unlawful. 114.2. a personal contribution in his or her own name unless he or she is also a federal contractor. Partnerships or LLCs with Corporate Partners or Members Because contributions from corporations are 4. reporting Partnership/ prohibited, a partnership or LLC with corporate LLC Contributions partners or members may not attribute any por- tion of a contribution to the corporate partners or members. 110.1(e) and 114.2(b). See also Included in Total Figure “Contributions from Limited Liability Compa- Partnership or LLC contributions are included nies” in Chapter 4, Section 10 of this Guide. in the total figure reported for “Contribu- A partnership or LLC composed solely of cor- tions From Individuals/Persons Other Than porate partners or members may not make any Political Committees” on the Detailed contributions. AOs 2001-07 and 1981–56; see Summary Page of Form 3 (Line 11a). also AOs 2009-14, 2003-28, 2001-18 and 1992- 17 for a limited exception pertaining to exempt Itemization costs for an affiliated corporate partner’s SSF. If a contribution from a partnership or LLC exceeds $200 or aggregates over $200 during Partnerships or LLCs with an election cycle, the committee must item- Foreign National Members ize the contribution on a Schedule A used for Similarly, because contributions from foreign “Contributions from Individuals/Persons Other nationals are prohibited, a partnership or LLC Than Political Committees” (Line 11(a)). may not attribute any portion of a contribution Additionally, if an individual partner’s share of to a partner who is a foreign national. 110.20. the contribution exceeds $200 when combined See Chapter 5, Section 1, for further informa- with other contributions received from that tion on the foreign national prohibition. partner in the same election cycle, the commit- tee must disclose, as a memo entry, itemized information on the partner (name, address, occupation, date contribution received, partner’s 128 Contributions from Partnerships share of contribution and aggregate cycle-to-date total of contributions PARTNERSHIP CONTRIBUTIONS made by that partner). 104.8 and 110.1(e). (See example at right.) FOR LINE NUMBER: PAGE OF SCHEDULE A (FEC Form 3) Use separate schedule(s) (check only one) ITEMIZED RECEIPTS for each category of the Detailed Summary Page X 11a 11b 11c 11d 12 13a 13b 14 15 Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. In-Kind Contributions NAME OF COMMITTEE (In Full) Doe for Congress Committee Full Name (Last, First, Middle Initial) Hobbes, Locke & Rousseau A committee reports the value of an A. Mailing Address 101 Modernity Ave. Date of Receipt 03 M M / D 04 D / Y 2012 Y Y Y in-kind contribution from a partnership City Fairfax State VA Zip Code 00000 or LLC in the same way it reports a FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period 750.00 , ▲ , ▲ . ▲ monetary contribution. In addition, Name of Employer Occupation Partnership Receipt For: Election Cycle-to-Date X See attribution below. as with all in-kind contributions, the ▼ Primary General Other (specify) ▼ , ▲ , ▲ 750.00 . ▲ committee must report the value of B. Full Name (Last, First, Middle Initial) Hobbes, Thomas Date of Receipt the in-kind contribution as an operat- Mailing Address 201 Sovereign Ave. 03 02 04 10 2012 M M / D D / Y Y Y Y City State Zip Code Bellum VA 00000 ing expenditure. Moreover, an in-kind FEC ID number of contributing C Amount of Each Receipt this Period contribution itemized on Schedule A federal political committee. Name of Employer Occupation , ▲ , 250.00 ▲ 1000.00 . ▲ Hobbes, Locke & Rousseau Accountant must also be itemized on a Schedule Receipt For: X Primary General Election Cycle-to-Date ▼ MEMO partnership attribution B for operating expenditures. 104.13 , ▲ 2200.00 , 250.00 . Other (specify) ▼ ▲ ▲ Full Name (Last, First, Middle Initial) and 110.1(e). However, any informa- C. Locke, John Mailing Address Date of Receipt 180 Prosperity Street 03 02 04 10 2012 M M / D D / Y Y Y Y tion about a partner itemized as a City Luckets State VA Zip Code 00000 memo entry on Schedule A does not FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period , 250.00 ▲ 1000.00 have to be reported on Schedule B. Name of Employer Hobbes, Locke & Rousseau Occupation Accountant , ▲ . ▲ Receipt For: Election Cycle-to-Date MEMO X ▼ Primary General partnership attribution , ▲ 2200.00 , 250.00 . Other (specify) ▼ More Information on ▲ ▲ Full Name (Last, First, Middle Initial) A. Rousseau, Jean Jacques Date of Receipt Partnership Contributions Mailing Address 101 General Will Road 02 03 10 04 2012 M M / D D / Y Y Y Y City State Zip Code Front Royal VA 00000 For more information on partner- FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period , ▲ ▲ 1000.00 , 250.00 . ▲ ship sponsored PACs and partnership Name of Employer Occupation Hobbes, Locke & Rousseau Accountant Receipt For: Election Cycle-to-Date MEMO X contribution plans, see the Campaign ▼ Primary General partnership attribution , ▲ 2200.00 , 250.00 . Other (specify) ▼ ▲ ▲ Guide for Nonconnected Committees. 129 Appendix B 130 Joint Fundraising Appendix C Overview of Rules All participants in a joint fundraising effort, Joint Fundraising including unregistered organizations, must: • Create or select a federal political committee to act as the joint fundraising representative; • Agree to a formula for allocat- 1. Introduction ing proceeds and expenses; • Sign a written agreement naming the joint fundraising representative and What Is Joint Fundraising stating the allocation formula; Joint fundraising is election-related fundrais- • Establish a separate account for joint fun- ing conducted jointly by a political commit- draising receipts and disbursements; tee and one or more other political com- mittees or unregistered organizations. • Notify the public of the allocation formula and certain other information (detailed below) when soliciting contributions; Who Must Observe Joint • Screen contributions to make sure they Fundraising Rules comply with the limits and prohibitions of the The rules described in this appendix apply Federal Election Campaign Act (the Act); and to political committees and unregistered • Report allocated proceeds and expenses organizations engaged in joint fundraising. (applies to political committees only). 102.17. Please note that nothing in these rules supersedes The committee named as the fundrais- the fundraising restrictions of 11 CFR Part 300. ing representative has additional respon- Participants in joint fundraisers should consult sibilities, as explained below. those regulations in addition to the provisions described below. See Appendix E, “Fundraising by Federal Candidates and Officeholders.” 2. Fundraising representative The participants in joint fundrais- ing activity may include; Joint fundraising participants must either establish Party committees, a new political committee (using a Statement of • Party organizations not regis- Organization(FEC Form 1)) or select a participat- tered as political committees, ing political committee to act as the joint fundrais- ing representative. 102.17(a)(1)(i); see also AO • Federal and nonfederal candidate committees, 2007-24. (It is strongly recommended for ease of • Nonparty political committees (except compliance with the law that participants establish separate segregated funds — SSFs) and a new political committee.) This committee is • Unregistered nonparty organiza- responsible for collecting and depositing joint fun- tions. 102.17(a)(1)(i) and (2). draising contributions; paying expenses; allocating proceeds and expenses to each participant; keeping The rules in this appendix do not apply to records; and reporting overall joint fundraising fundraising by collecting agents and separate activity. 102.17(b)(1) and (b)(2). A new political segregated funds. 102.17(a)(3). Such organiza- committee established for the joint fundraiser must tions may only jointly raise funds with another register with the FEC using FEC Form 1(Statement affiliated organization; for more information, of Organization), and must include the name of see Chapter 3, Section 9 of the Campaign Guide each participating federal candidate in the new for Corporations and Labor Organizations. committee’s name. 102.14. (An existing commit- tee would be required to amend its Statement of 131 Appendix C Organization.) Thus, for example, a joint fundrais- 4. Separate Depository ing committee established to raise funds for a candidate and a party could not be called “Victory ’12,” but might be called the “John Doe Victory Establishing the Account ’12” committee. Any federal candidate participating in the fundraiser must designate the fundraising The joint fundraising participants or the joint representative as an authorized committee (by fundraising representative must establish a separate amending the Statement of Candidacy, (FEC Form account solely for the receipt and disbursement 2)). 102.17(a)(1)(i), (b)(1) and (b)(2); AO 2007-24. of all joint fundraising proceeds. Each participating political committee must amend its Statement of Organization (FEC Form 1) to show the account Joint Fundraising Representative as an additional depository.1 102.17(c)(3)(i). If a new committee is established, it collects all the contributions. 102.17(b)(1). Note that such Depositing Contributions a committee may not itself be a participant in any other joint fundraising effort, though it The joint fundraising representative must deposit may conduct more than one event or activity contributions into the account within 10 days after on behalf of its own participants. 102.17(a)(1) receiving them. Only contributions permissible (i). Alternatively, if a committee participating in under the Act may be deposited in the joint fund- the fundraiser serves as the joint fundraising raising account. If any participant is an unregistered representative, it and any other participating com- organization which may, under state law, accept mittees may collect contributions; however, all prohibited contributions, the participants may contributions received by the other participants either establish a second account for such contri- must be forwarded to the joint fundraising rep- butions or forward them directly to the partici- resentative within 10 days of receipt. 102.17(b) pants that may accept them. 102.17(c)(3)(i) and (ii). (2). Under either option, the procedures outlined in the sections below for joint fundraising apply. 5. Statements of Organization Use of Commercial Firm Although participants may hire a commercial Joint Fundraising Representatives fundraising firm or other type of agent to assist with organizing and holding the joint fundraiser, As noted above, the joint fundraising commit- they are still required to establish or select tee must file a Statement of Organization (FEC a new political committee to serve as the Form 1). The Statement of Organization must: fundraising representative. 102.17(a)(1)(ii). • Identify the committee as the joint fundraising representative; • List the names and addresses of all 3. Written Agreement federal committees participating in the joint fundraising effort; and Before conducting a joint fundraiser, all partici- • Name the depository institution being pants must enter into a written agreement that used by the joint fundraising committee. identifies the joint fundraising representative and states the allocation formula—the amount (See example opposite.)102.2. or percentage that the participants agree to use for allocating proceeds and expenses. The joint fundraising representative must retain a copy of 1 Note that when paper filers amend the the written agreement for three years and make Statement of Organization (FEC Form 1), only it available to the FEC upon request. 102.17(c)(1). the committee’s name, address and the new or changed information need be included. 132 Joint Fundraising FORM 1 FILED BY JOINT FUNDRAISING REPRESENTATIVE Other Joint Fundraising Participants JOINT FUNDRAISING REPRESENTATIVE– Each participant in the joint fundraiser X This committee collects contributions, pays fundraising expenses and disburses net proceeds for two or more political (G) (other than the joint fundraising committees/organizations, at least one of which is an authorized committee of a federal candidate. This committee collects contributions, pays fundraising expenses and disburses net proceeds for two or more political (f) representative) must amend its FEC committees/organizations, none of which is an authorized committee of a federal candidate. Committees Participating In Joint Fundraiser 1. Doe for Congress Committee FEC ID number C 00033000 Form 1 (Statement of Organization) Johnson for Congress Committee C 00044000 2. FEC ID number FEC ID number C to provide the name and address 3. 4. FEC ID number C of the joint fundraising representa- 5. FEC ID number C tive—identified as the “JFR”—and to state the name and address of the depository institution hold- ing the joint fundraising account, if that account is different from the FORM 1 FILED BY PCC SHOWING AFFILIATION depository named on its current FEC Form 1. (See example.) In addition, FEC Form 1 (Revised 12/2007) Page 3 each federal candidate participating Write or Type Committee Name in the fundraiser must amend FEC Doe for Congress 6. Name of Any Connected Organization, Affiliated Committee, Leadership PAC Sponsor or Joint Fundraising Representative Form 2 (Statement of Candidacy) Doe / Johnson Golf Outing to designate the joint fundraising representative as an authorized 201 King Street candidate committee. 102.2(a)(2), Mailing Address 102.17(a)(1)(i), (b)(1), (b)(2) and (c)(3). Alexandria VA 00000 CITY STATE ZIP CODE Relationship: Connected Organization Affiliated Committee Leadership PAC Sponsor X Joint Fundraising Representative 6.Start-Up Costs 7. Custodian of Records: Identify by name, address (phone number -- optional) and position of the person in possession of committee books and records. Participants may advance funds to Herman Lotze Full Name the joint fundraising representative 319 Main Street Mailing Address for start-up costs of the fundraiser. (Note, however, that individuals may CITY STATE ZIP CODE not advance such costs or pay for Title or Position expenses out of pocket to be reim- Bookkeeper 703 000 0000 Telephone number bursed later. See AO 2007-24.) The 8. Treasurer: List the name and address (phone number -- optional) of the treasurer of the committee; and the name and address of any designated agent (e.g., assistant treasurer). amount advanced by a participant Full Name should be in proportion to the agreed Gottlob Frege of Treasurer 319 Main Street upon allocation formula. Any amount Mailing Address advanced in excess of a participant’s proportionate share is considered a Title or Position CITY STATE ZIP CODE contribution and must not exceed Treasurer Telephone number 703 000 0000 the amount the participant may FE3AN042.PDF contribute to the other participants. 102.17(b)(3)(i) and (ii). (However, an exception is made for funds trans- ferred between party committees under 102.6(a)(1)(ii) and 110.3(c) (1). See also Section 14 below.) 133 Appendix C Example Special Situations Committees A, B and C determine they need In two situations, participants must include addi- $2,000 in start-up costs. According to their tional information in the joint fundraising notice: allocation formula (Committees A and B, 25 • If a participant is engaging in the joint fund- percent each; Committee C, 50 percent), Com- raiser to pay off outstanding debts, the notice mittees A and B each advance $500 to the joint must state that the allocation formula may fundraising representative, and Committee C, change if the participant receives enough $1,000. If, however, Committee C advances funds to pay its debts. See Chapter 4, Sec- the entire $2,000, it has made a $500 contri- tion 8, “Contributions to Retire Debts.” bution to each of the other committees. • If, under state law, any unregistered participant is permitted to receive contributions prohib- Unregistered Organizations ited under the Act, the notice must say that An unregistered organization (such as a party such contributions will be given only to partici- organization that has not yet qualified as a pants that may legally accept them. political committee) must use permissible 102.17(c)(2)(ii). funds when advancing money for start-up costs. 102.17(c)(3)(i). If an unregistered participant advances more than its share of start-up costs 8. Screening Contributions and thus makes a contribution, the contributed amount may trigger registration and report- The fundraising representative and participants ing requirements under the Act. 100.5. must screen all contributions to make sure they are neither prohibited by the Act nor in excess of the Act’s contribution limits. (Prohibited contribu- 7. Joint Fundraising Notice tions received by unregistered organizations do not have to be screened.) The maximum amount a contributor may give to a joint fundraiser is General Rule the total amount he or she may contribute to In addition to any fundraising or disclaimer all participants without exceeding any limits. notices required (see Chapter 10, Sections 1 To facilitate screening, participants must provide and 2), a joint fundraising notice must appear the joint fundraising representative with records with every solicitation for contributions. The of past contributions so that the representative notice must contain the following information: may determine whether a donor has exceeded • The names of all participants, regardless of the contribution limits. 102.17(c)(4)(i) and (c)(5). whether they are registered political com- mittees or unregistered organizations; • The allocation formula (the amount or 9. recordkeeping percentage of each contribution that will be allocated to each participant); Receipts • A statement informing contributors that they may designate contributions for a particular With regard to gross proceeds, the joint fund- participant (notwithstanding the formula); and raising representative must collect the follow- ing contributor information and later forward • A statement that the allocation formula may it to the participating political committees: change if any contributor makes a contribution which would exceed the amount he or she • For contributions exceeding $50, the may lawfully give to any participant. amount, date of receipt, and the con- 102.17(c)(2)(i). tributor’s name and address. 134 Joint Fundraising • For contributions exceeding $200, the • A surplus for a participant raising money amount, date of receipt, and the contributor’s solely to pay off campaign debts. name, address, occupation and employer. Reallocation under these circumstances must be 100.12, 102.8(b) and 102.17(c)(4)(ii). based on the other participants’ proportionate The date of receipt is the date the joint shares under the allocation formula. If reallocation fundraising representative receives the results in a contributor exceeding the contribu- contribution. 102.17(c)(3)(iii). tion limits for the remaining participants, the joint fundraising representative must return the excess amount to the contributor. 102.17(c)(6)(i). Prohibited Contributions The joint fundraising representative must also Example keep a record of the total amount of prohibited contributions received, if any, and of any transfers Using the same example mentioned above (alloca- containing prohibited funds made to partici- tion formula: Committees A and B, 25 percent pants that may accept them. 102.17(c)(4)(ii). each; Committee C, 50 percent), the participants receive a $2,000 contribution from a donor who had previously contributed up to his limit to Com- Disbursements mittee C. If the fundraising representative were to The joint fundraising representative must retain, divide the contribution according to the allocation for three years, records on all disbursements formula, Committee C would receive an excessive made for the joint fundraiser. 102.17(c)(4)(iii) contribution of $1,000. Instead, the excess $1,000 and 102.9. The required recordkeeping informa- is divided equally between Committees A and B, tion is described under Chapter 11, Section 3, since their proportionate shares under the alloca- “Recording Disbursements.” If a commercial tion formula are equal. Each receives an extra $500, fundraising firm or agent is used, it must forward bringing their total allocation to $1,000 apiece. required records on disbursements to the joint If, however, Committee A can accept only fundraising representative. 102.17(c)(4)(iii). $800 from the contributor without exceed- ing the limit, the excess $200 is allocated to Committee B. If Committee B cannot accept 10. Paying Expenses: Step 1 — the money for the same reason, the $200 Allocating Gross Proceeds must be returned to the contributor. In general, expenses must be paid before proceeds Designated Contributions may be transferred to the participants. Thus, Designated or earmarked contributions that the joint fundraising representative may make exceed the contributor’s limit for a participant payments for fundraising expenses from gross may not be reallocated without the prior writ- proceeds collected at the fundraiser (and from ten consent of the contributor. 102.17(c)(6)(ii). funds advanced by the participants). 102.17(c) (7)(iii). Nevertheless, it must allocate (but not transfer) gross proceeds among the participants. Prohibited Contributions Generally, the joint fundraising representa- Prohibited contributions must be distributed only tive must allocate gross proceeds accord- to the unregistered participants that may lawfully ing to the allocation formula. However, as accept them; they do not have to be distributed stated in the fundraising notice, the formula according to the allocation formula. 102.17(c)(6)(iii). may change if the allocation results in: • An excessive contribution from a contributor to one of the participating committees; or 135 Appendix C 11. Paying Expenses: Step Example 2 — Allocating Expenses At the start of the fundraiser, Committees A, B and C agree to allocate 25 percent of proceeds and After gross proceeds are allocated, the joint expenses to Committee A, 25 percent to Commit- fundraising representative must calculate each tee B and 50 percent to Committee C. However, participant’s share of expenses based on its actual because the joint fundraising representative must share of gross proceeds. This allocation may reallocate some contributions, Committee A is differ from the original formula—see example actually allocated 20 percent of gross proceeds; below. (Prohibited contributions may be excluded Committee B, 35 percent; and Committee C, from the gross proceeds when determining 45 percent. The fundraising representative must the ratio.) 102.17(c)(7)(i)(A). Expenses for a allocate the joint fundraising expenses, $10,000, series of fundraising events must be allocated on the same basis: $2,000 to Committee A, $3,500 on a per-event basis. 102.17(c)(7)(i)(C). to Committee B and $4,500 to Committee C. Excess Payment If a participant pays for more than its allocated share of expenses, the excess payment is considered JOINT FUNDRAISING (SCHEDULE A) a contribution, subject to the Act’s limits (see “Start-Up Costs,” Sec- SCHEDULE A (FEC Form 3) Use separate schedule(s) FOR LINE NUMBER: (check only one) PAGE OF tion 6 of this chapter). 102.17(c) (7)(i)(B). (Party committees are for each category of the ITEMIZED RECEIPTS 11a 11b 11c 11d Detailed Summary Page X 12 13a 13b 14 15 exempt from this rule when paying Any information copied from such Reports and Statements may not be sold or used by any person for the purpose of soliciting contributions or for commercial purposes, other than using the name and address of any political committee to solicit contributions from such committee. for other party committee partici- NAME OF COMMITTEE (In Full) Doe for Congress Committee A. Full Name (Last, First, Middle Initial) Doe/Johnson Golf Outing 2012 Date of Receipt pants because, as explained below, Mailing Address 201 King St. 03 28 2012 they may make unlimited transfers M M / D D / Y Y Y Y City State Zip Code Alexandria VA 00000 to other party committees.) FEC ID number of contributing federal political committee. C 00000000 Amount of Each Receipt this Period Name of Employer Occupation , ▲ 1,900.00 , ▲ . ▲ Remember, if an unregistered par- Receipt For: X Primary General Election Cycle-to-Date ▼ Joint Fundraiser ticipant makes such a contribution, 2,000.00 Other (specify) ▼ , ▲ , ▲ . ▲ the payment may trigger registra- tion and reporting requirements Full Name (Last, First, Middle Initial) B. Rosity, Jenny Date of Receipt Mailing Address 1324 Seven Chimney Ln. 02 25 2012 for that organization. 100.5. M M / D D / Y Y Y Y City State Zip Code Centreville VA 00000 FEC ID number of contributing federal political committee. C Amount of Each Receipt this Period Name of Employer Occupation , ▲ 1,000.00 , ▲ . ▲ Centreville College Professor Receipt For: X Primary General Election Cycle-to-Date ▼ MEMO Joint Fundraiser 12. Paying Expenses: ,1,000.00 , . Doe/Johnson Golf 2012 Step 3 — Other (specify) ▼ ▲ ▲ ▲ Full Name (Last, First, Middle Initial) Magnanimous, Joseph Calculating Net Date of Receipt C. Mailing Address 490 Main St. 02 25 2012 M M / D D / Y Y Y Y City State Zip Code Fredericksburg FEC ID number of contributing federal political committee. C VA 00000 Amount of Each Receipt this Period Proceeds Name of Employer Occupation , ▲ 1,000.00 , ▲ . ▲ Wittgenstein & Russell Attorney Receipt For: Election Cycle-to-Date MEMO The joint fundraising representa- X Joint Fundraiser ▼ Primary General Other (specify) ▼ , ▲ ,1,000.00 ▲ . ▲ Doe/Johnson Golf 2012 tive may delay transferring net SUBTOTAL of Receipts This Page (optional) ............................................................................ , ▲ 1,900.00 , ▲ . ▲ proceeds to participants until after ▼ TOTAL This Period (last page this line number only) ............................................................... , ▲ 10,060.00 , ▲ . ▲ it receives all contributions and ▼ FEC Schedule A (Form 3) (Revised 02/2009) pays all expenses for the fundraiser. To determine net proceeds, the fundraising representative subtracts 136 Joint Fundraising the participant’s share of expenses from its share Participants of gross proceeds. 102.17(c)(3)(ii) and (c)(7)(i)(A). After the joint fundraising representative distrib- utes the net proceeds, each participating political Example committee reports its share as a transfer-in from Committees A, B and C raise $50,000 in gross the joint fundraising representative on Line 12 (Transfers from Other Authorized Committees) proceeds and spend $10,000 in expenses, and itemizes the transfer on a separate schedule A leaving $40,000 in net proceeds. The joint for that Line. Using the records received from the fundraising representative allocates $10,000 joint fundraising representative, a participating com- (20 percent) in gross proceeds to Commit- mittee also must itemize its share of gross receipts tee A and $2,000 (20 percent) in expenses; as contributions from the original donors on a Committee A’s net proceeds equal $8,000. memo entry Schedule A (to the extent required by the rules on itemization—see Chapter 13, Sec- tion 4). When itemizing gross contributions, the participant must report the date of receipt as the 13. reporting day the joint fundraising representative received the contribution. 102.17(c)(3)(iii) and (c)(8)(i)(B). By Joint Fundraising Representative The joint fundraising representative reports all joint 14. Exception for Party fundraising proceeds in the reporting period in Committees2 which they are received. If any prohibited contribu- tions are received for a participating unregistered Payments made by a party committee (that is a organization, the joint fundraising representative registered federal political committee) on behalf of must report them as a memo entry. Any Schedule A another party committee are considered transfers used to itemize contributions must clearly indicate of funds rather than contributions. Because there on the schedule that the receipts are joint fundrais- is no limit on transfers between party committees of the same political party, a party committee may ing proceeds. 102.17(c)(3) (iii) and (c)(8)(i)(A). pay any amount of another party committee’s The joint fundraising representative must also allocated start-up costs and fundraising expenses. report all disbursements made for the joint fun- Moreover, if all the participants in the fundraiser draiser in the reporting period in which they are are party committees, start-up costs and fundrais- made. 102.17(c)(8)(ii). Transfers of net proceeds ing expenses need not be allocated at all. 102.6(a) to the joint fundraising participants are reported (1)(i) and (ii); 102.17(b)(3)(iii) and (c)(7)(ii). as transfers to affiliated committees and item- ized on a separate Schedule B for that category. Payments by Unregistered Party Organizations Electronic Filing The same exception also applies to unregistered party organizations. They must, use funds permis- If the joint fundraising participants include a sible under the Act when making payments for House campaign or a party committee (regardless start-up costs and fundraising expenses. Further- of whether a Senate campaign is participating), more, such payments by a party organization on then the joint fundraising representative must file behalf of a registered party committee count electronically if its total yearly contributions or against the $1,000 contribution/expenditure total yearly expenditures exceed, or are expected 2 This section also applies to nonconnected committees to exceed, $50,000. 104.18. For more information and unregistered political organizations that are affiliated. on electronic filing, see Chapter 12, Section 5. See Chapter 4, Section 1 for the definition of “affiliated.” 137 Appendix C threshold for registration as a political commit- tee. 100.5, 102.6(a)(2) and 102.17(c)(7)(ii). 138 Communications Appendix D • Any other form of general public political advertising.1 100.26, 100.27 and 100.28. Communications 2. Coordinated Communications NOTE: This section discusses communications that are not made by the campaign, but that are When a committee, group or individual pays for a made by others in support of, or opposition to, communication that is coordinated with a campaign a candidate. Candidates and their campaigns may or a candidate, the communication is either an in- reproduce and distribute this appendix to anyone kind contribution or, in some limited cases, a coor- who requests FEC guidelines on such communica- dinated party expenditure by a party committee. tions. Citations refer to Federal Election Com- mission regulations, contained in Title 11 of the Coordination Defined Code of Federal Regulations (11 CFR). Advisory opinions (AOs) issued by the Commission are Coordinated means made in cooperation, con- cited as well. If you have any questions after read- sultation or concert with, or at the request or ing this appendix, please call the Commission: suggestion of, a candidate, a candidate’s autho- 1-800/424-9530 (toll free) or 202/694-1100. rized committee, or their agents, or a political party committee or its agents.2 109.20. 1. Public Communications Determining Coordination FEC regulations provide for a three-pronged It is important to understand how the Act and test to determine whether a communication FEC regulations define “public communication” is coordinated. A communication must satisfy because many of the rules regarding political all three prongs of the test to be considered communications depend upon whether the com- a coordinated communication (and as a result, munication in question is a public communication. count against contribution limits). 109.21(a). The three prongs of the test consider: Definition • The source of payment (payment prong); A public communication is a communication • The subject matter of the com- to the general public made by means of: munication (content prong); and • Any broadcast, cable or satel- • The interaction between the person paying lite communication; for the communication and the candidate or • Newspaper; political party committee (conduct prong). • Magazine; When the payment prong, the content prong • Outdoor advertising facility; and the conduct prong are all satisfied, then the communication is a coordinated commu- • Mass mailing (more than 500 pieces of substan- nication and results in an in-kind contribution. tially similar mail within any 30-day period); (See Chapter 13, Section 10 for instructions • Telephone bank (more than 500 on how to report such a contribution.) substantially similar telephone calls within any 30-day period); • An advertisement placed for a fee 1 The term general public political advertising does not include any Internet communication on another person’s website; or except for a communication placed for a fee on another person’s website. 2 For the purposes of 11 CFR Part 109 only, “agent” is defined at 109.3. 139 Appendix D Payment Prong −Refers to a political party, is coordinated The payment prong is satisfied when a with a Presidential candidate and is coordinated communication is paid for, in publicly distributed during the period whole or in part, by a person other than the starting 120 days before the primary candidate, an authorized committee or a until the date of the general election.3 political party committee with whom the com- For communications that refer to both a party munication is coordinated. 109.21(a)(1). and a clearly identified federal candidate, see 109.21(c)(4)(iv); or 109.21(c)(4)(i)-(iv). Content Prong A public communication that is the functional A communication that meets any one of these equivalent of express advocacy.4 109.21(c)(5). five standards meets the content prong: • A communication that is an electioneering Conduct Prong communication (see Section 6 of this appendix); The purpose of the conduct prong is to deter- • A public communication that republishes, mine when interaction between the campaign disseminates or distributes candidate cam- and the person paying for the communication paign materials, unless the activity meets might constitute coordination. A communication one of the exceptions at 109.23(b); that satisfies any one of the conduct standards described below satisfies the conduct prong. • A public communication that expressly advocates the election or defeat of a clearly 1) request or Suggestion. This conduct standard identified candidate for federal office; has two parts, and satisfying either satisfies the standard. The first part is satisfied if the person • A public communication that: creating, producing or distributing the communica- −Refers to a clearly identified House tion does so at the request or suggestion of a or Senate candidate and is publicly candidate, authorized committee, political party distributed in the identified candidate’s committee or agent of any of these. A communica- jurisdiction within 90 days of the can- tion satisfies the second part of the “request or didate’s primary or general election; suggestion” conduct standard if the person paying −Refers to a clearly identified Presidential for the communication suggests the creation, candidate and is publicly distributed production or distribution of the communica- during the period starting 120 days tion to the candidate, authorized committee, before the primary election and ending political party committee or agent of any of the on the date of the general election; above, and the candidate or political party com- mittee assents to the suggestion. 109.21(d)(1). −Refers to a political party in a midterm election cycle, is coordinated with a party committee and is publicly distributed within 90 days of a primary or general election; 3 The rules at 109.21(c)(4) regarding the public communication content standard time frames are −Refers to a political party in a Presi- the subject of a litigation challenge in Shays et al. v. dential election cycle, is coordinated FEC, _ F. Supp. 2d __, 2007 WL 2616689 (D.D.C. Sept. 12, 2007) (Shays III). On 9/12/07, the District Court with a party committee and is publicly remanded this regulation to FEC for reconsideration. distributed during the period starting 4 A communication is the functional equivalent of 120 days before the primary and ending express advocacy if it is “susceptible of no reasonable on the date of the general election; interpretation other than as an appeal to vote for or against a clearly identified federal candidate.” This −Refers to a political party, is coordinated content standard applies without regard to the timing with a House or Senate candidate and of the communication or the targeted audience. is publicly distributed in that candi- See the Commission’s Final Rules on Coordinated date’s jurisdiction within 90 days of Communications published in the September 15, 2010, Federal Register (75 FR 55947), available at http://www. the primary or general election; or fec.gov/law/cfr/ej_compilation/2010/notice2010-17.pdf. 140 Communications 2) Material Involvement. This conduct standard party committee. This previous relationship is satisfied if a candidate, candidate committee, is defined in terms of nine specific services political party committee or an agent of any related to campaigning and campaign com- of these was “materially involved in decisions” munications. (See 109.21(d)(4)(2).) Note that regarding any of the following aspects of a public these services would have to have been ren- communication paid for by someone else: dered within 120 days before the purchase or public distribution of the communication; and • Content of the communication; • The commercial vendor uses or conveys • Intended audience; information about the campaign plans, proj- • Means or mode of the communication; ects, activities or needs of the candidate or • Specific media outlet used; political party committee, or information previously used by the commercial vendor • Timing or frequency of the communication; or in serving the candidate or political party • Size or prominence of a printed communica- committee, to the person paying for the com- tion or duration of a communication by means munication, and that information is material of broadcast, cable or satellite. 109.21(d)(2). to the creation, production or distribution of 3) Substantial Discussion. A communication the communication. 109.21(d)(4). See “Safe meets this conduct standard if it is created, pro- Harbor for Publicly Available Information and duced or distributed after one or more substantial “Safe Harbor for Use of a Firewall,” below. discussions between the person paying for the 5) Former Employee/Independent Contractor.