02-30265. FEC Policy Statement: Interim Reporting Procedures

AGENCY:

Federal Election Commission.

ACTION:

Statement of policy.

SUMMARY:

During the transition period following the effective date of the Bipartisan Campaign Reform Act of 2002 (“BCRA”), the Commission intends to exercise its discretion by not pursuing the political committees and other persons and entities addressed below for possible violations of the reporting statutes and regulations covered by the instructions set out in this policy statement if they fully adhere to those instructions and timely file the described reports. The limitations on the scope and duration of the policy are discussed in detail below.

FOR FURTHER INFORMATION CONTACT:

Mr. John C. Vergelli, Acting Assistant General Counsel, Mr. Jonathan M. Levin, Senior Attorney, Mr. Gregory Scott, Assistant Staff Director for Information, and Ms. Debbie Chacona, Reports Analysis Division Chief of Party/Non-Party Branch, 999 E Street, NW., Washington, DC 20463, [phone] or [phone].

SUPPLEMENTARY INFORMATION:

Congress established a 90-day period during which the Commission was required to promulgate regulations implementing Title I of BCRA regarding certain national, state, and local party committee activities, including reporting of Federal election activity and certain allocable expenses. This period ended on June 25, 2002. Congress also required the Commission to complete the remaining BCRA rulemakings, including those regarding other reporting requirements, in 270 days, which is December 22, 2002. The Commission adopted final rules implementing Title I on June 25, 2002. Prohibited and Excessive Contributions: Non-Federal Funds or Soft Money; Final Rule, 67 FR 49,064 (July 29, 2002) (“Soft Money Final Rules”). The Commission has also completed four other rulemakings to implement BCRA: (1) Final Rules on Electioneering Communications, 67 FR 65190 (October 23, 2002); (2) Interim Final Rules Regarding FCC Database on Electioneering Communications, 67 FR 65212 (October 23, 2002); (3) Final Rules on Reorganization of Regulations on Contributions and Expenditures, 67 FR 50582 (August 5, 2002); and (4) Final Rules on Contribution Limitations and Prohibitions, 67 FR 69928 (November 19, 2002). The Commission notes that other BCRA-related reporting rules (e.g., electioneering communications, independent expenditures) are not yet finalized, but are expected to be before December 22, 2002, including the Consolidated Reporting Rulemaking, which the Commission is scheduled to complete on December 12, 2002. Issuance of new and revised reporting forms, software and instructions is dependent upon the finalization of all the reporting rules. However, BCRA's reporting requirements became effective on November 6, 2002. The Commission is in the process of updating its reporting forms, software, and instructions to incorporate all the new regulations, and will need a period of time after December 22, 2002, to complete this process. In the interim, filers will continue to use existing disclosure forms and software for their December 5th Post General Election Report, January 31st Year End Report and, for monthly filers only, the February Monthly Report, which covers January 2003.

BCRA introduced new reporting responsibilities for political party committees and other reporting entities and significantly changed certain existing requirements. Among the significant changes introduced by BCRA are the reporting by State, district, and local party committees of Federal election activities (“FEA”), including the allocation of some of those activities between Federal funds and “Levin” funds, and revisions in those committees' allocations of payments between Federal and non-Federal funds. See 11 CFR 300.2(i), 300.36, 106.7, and 104.17. In addition, BCRA introduced provisions for Federal candidates and their committees with respect to candidate funding of his or her own campaign in the form of the “millionaires provision” and provisions for reporting by individuals and entities making electioneering communications. See 2 U.S.C. 434(a)(6)(B), 434(f), and 441a-1(b).

As new forms are now being developed to meet the new requirements, the Commission concludes that a period of transition and adjustment with respect to reporting is needed, including allowance for the continued use of the ballot composition formula in the Post-General and Year End Reports. To assist filers during this transition period, the Commission has developed the interim disclosure procedures set forth below.^[1] These procedures address BCRA-related transactions not contemplated by the existing reporting forms and filing software. Questions concerning these procedures may be directed to the FEC's Information Division, Reports Analysis Division or Electronic Filing Office, as appropriate.

Hence, the Commission intends to exercise its discretion by not pursuing the committees and other persons and entities addressed below for possible violations of the reporting statutes and regulations covered by the instructions set out in this policy statement if the filers fully adhere to those instructions and timely file the reports.

Interim Reporting Procedures

Interim Disclosure Procedures for State, District and Local Party Committees

1. Reporting Allocable Administrative and Generic Voter Drive Expenses (that are not Federal Election Activity (FEA)) for November and December 2002

For the December 5th Post General Election report and the January 31st Year End report only, state, district and local party committees may continue to allocate administrative and generic voter drive expenses according to the ballot composition ratio for the 2001-2002 election cycle. Committees should report this activity just as they always have: payments should be disclosed on Schedule H4, and transfers from the nonfederal account should appear on Schedule H3. Committees need not submit a new Schedule H1.

2. Reporting Allocable Exempt Activities (that are not FEA) for November and December 2002

For the December 5th Post General Election report and the January 31st Year End report only, state, district and local party committees may continue to allocate payments for exempt activities based on the time or space devoted to federal candidates, as compared to the time or space of the entire communication. Committees should report this activity just as they always have: payments should be disclosed on Schedule H4, and transfers from the nonfederal account should appear on Schedule H3.

3. Reporting Receipts of “Levin Funds”

• Paper Filers:

—Using a separate Schedule A, itemize each receipt (regardless of amount) as a memo entry. Do not include these receipts in totals or on the Detailed Summary Page.

—IMPORTANT: Label the Schedule A “Levin funds.”

—Disclose total “Levin fund” receipts as a lump sum in a cover memo attached to the report.

• E-Filers:

—On a Schedule A, itemize each receipt (regardless of amount) as a memo entry. These receipts will not be included in totals or on the Detailed Summary Page.

—IMPORTANT: Use the text entry description field to label the receipt as “Levin funds”

—Disclose total “Levin fund” receipts as a lump sum using a text record.

Note:

During the transition period, the Commission will allow committees to amend reports to disclose as Levin funds receipts that were not initially disclosed as such. The Commission plans to address this issue more broadly when it finalizes the reporting and filing procedures for BCRA in 2003.

4. Reporting Disbursements for Non-Allocable (100% federal) “Federal Election Activities” (i.e., Public Communications and Certain Salary Payments)

• Paper Filers:

—Use a separate Schedule B labeled “FEA—100% Federal” to disclose each disbursement, regardless of amount.

—Adjust the totals on the completed Detailed Summary Page by adding the total “FEA—100% Federal” to line 31 “Total Federal Disbursements.”

• E-Filers:

—Using Schedule B as a model, submit a Form 99 (miscellaneous text submission) labeled “FEA—100% Federal” disclosing for each disbursement, regardless of amount:

• The name of the committee;
• The name, mailing address, city, state and zip code for each payee;
• The date and amount; and
• The purpose of the disbursement.

—To account for these disbursements on your regular report (e.g., 2002 Year End Report), adjust the cash on hand figure on line 8 of the Summary Page.

—Examples of these transactions in FECFile are available on the Commission's BCRA web page at http://www.fec.gov/​pages/​bcra/​bcra_​update.htm.

5. Reporting the Allocation Formula for Paying Allocable “Federal Election Activities,” if any, Conducted in 2002

Use the table below to determine the appropriate formula for allocating “Federal Election Activities,” if any, conducted between November 6, 2002, and December 31, 2002.

2002 Races on general election ballot	Federal percentage
A Senate candidate was on the ballot in my state in the 2002 General election	21% Federal
A Senate candidate was not on the ballot in my state in the 2002 General election	15% Federal

• Paper Filers

—Attach a cover letter, labeled “H1-FEA,” to disclose the applicable federal percentage for allocable “federal election activity.”

• E-Filers

—Add a text record, labeled “H1-FEA,” to disclose the applicable federal percentage for allocable “federal election activity.”

6. Reporting the Allocation Formula Used for Paying Allocable “Federal Election Activities” and for Administrative Expenses and the Cost of Generic Voter Drives, as of January 1, 2003

Use the table below to determine the appropriate allocation formula to use on or after January 1, 2003.

2004 Races on general election ballot	Federal percentage
Presidential and Senate candidates will both be on the ballot in my state in the next regular federal general election	36% Federal
Presidential candidate, but not a Senate candidate, will be on the ballot in my state in the next regular federal general election	28% Federal

On the first report disclosing 2003 activity (e.g., February 20th Monthly Report):

• Paper Filers

—Attach a cover letter, labeled “H1-FEA,” to disclose the applicable federal percentage for allocable “federal election activity.”

—Do not use the current version of Schedule H-1.

• E-Filers

—Add a text record, labeled “H1-FEA,” to disclose the applicable federal percentage for allocable “federal election activity.”

7. Reporting Disbursements for “Federal Election Activities” Allocated Between Federal Funds and “Levin Funds”

• Paper Filers

—Using Schedule H4 as a model, submit a cover letter labeled “H6-Shared FEA,” disclosing:

 • The name of the committee;

 • The name, mailing address, city, state and zip code for each payee;

 • The date of each transaction;

 • The category of federal election activity (e.g., voter registration);

 • The year-to-date total for the activity;

 • The purpose of disbursement;

 • The federal share of each expense;

 • The “Levin fund” share of each expense; and

 • The combined federal/Levin total for each entry.

—As on Schedule H4, multiple entries may appear on each page, and should be subtotaled by page and totaled on the last page.

—Adjust the totals on the completed Detailed Summary Page by:

 • Adding the combined federal and Levin fund total from the last page to the total for line 30 “Total Disbursements;” and

 • Adding the total federal share from the last page to the total for line 31 “Total Federal Disbursements.”

• E-Filers

—Using Schedule H4 as a model, submit a Form 99 (miscellaneous text submission) labeled “H6-Shared FEA,” disclosing:

 • The name of the committee;

 • The report to which the activity relates (e.g., 2002 Year End Report);

 • The name, mailing address, city, state and zip code for each payee;

 • The date of each transaction;

 • The category of federal election activity (e.g., voter registration);

 • The year-to-date total for the activity;

 • The purpose of disbursement;

 • The federal share of each expense;

 • The “Levin fund” share of each expense; and

 • The combined federal/Levin total for each entry.

—As on Schedule H4, multiple entries may appear on each page of the H6, and should be subtotaled by page and totaled on the last page.

—To account for these disbursements on your regular report (e.g., 2002 Year End Report), adjust the cash on hand figure on line 8 of the Summary Page.

—Examples of these transactions in FECFile are available on the Commission's BCRA Web page at http://www.fec.gov/​pages/​bcra/​bcra_​update.htm.

8. Reporting Transfers of “Levin Funds” Into the Federal Account for Shared “Federal Election Activity”

• Paper Filers:

—Using Schedule H3 as a model, submit a cover letter labeled “H5-Transfers of Levin Funds for Shared FEA,” disclosing:

 • The name of the committee;

 • The name of the account (i.e., “Levin”);

 • The date of the transfer; and

 • The categorical breakdown of the transfer received on that date (e.g., total voter registration, total GOTV, etc.).

—As on Schedule H3, transfers must be segregated by date on the H5. It is permissible, however, to include transfers occurring on multiple dates on each page, as long as they are segregated by date.

—Aggregate transfers by category should appear at the bottom of the last page of H5.

—Adjust the totals on the completed Detailed Summary Page by adding the combined Levin fund transfers to the total for line 19 “Total Receipts.”

—Do not adjust the total for line 20 “Total Federal Receipts.”

• E-Filers

—Using Schedule H3 as a model, submit a Form 99 (miscellaneous text submission) labeled “H5-Transfers of Levin Funds for Shared FEA,” disclosing:

• The name of the committee;
• The name of the account (i.e., “Levin”);
• The report to which the activity relates (e.g., 2002 Year End Report);
• The date of the transfer; and
• The categorical breakdown of the transfer received on that date (e.g., total voter registration, total GOTV, etc.).

—As on Schedule H3, transfers must be grouped by date on the H5. However, unlike H3, it is permissible to include transfers occurring on multiple dates on a single page, so long as the transfers remain grouped by date.

—Total Levin fund transfers by category should appear at the bottom of the last page of H5.

—To account for these receipts on your regular report (e.g., 2002 Year End Report), adjust the cash on hand figure on line 8 of the Summary Page.

—Examples of these transactions in FECFile are available on the Commission's BCRA web page at http://www.fec.gov/​pages/​bcra/​bcra_​update.htm.

Interim Disclosure Procedures for Federal Candidates and Campaign Committees

1. Additional Registration Information Pursuant to the “Millionaires Provision”

All candidates seeking election to federal office on/after January 1, 2003, must provide an e-mail address, a fax number and a declaration of intent to expend personal funds.

• Paper Filers:

—Attach a cover memo to FEC Form 2, Statement of Candidacy, disclosing an e-mail address, a fax number and a declaration of intent to expend personal funds.

• The declaration should read: “With respect to this election, I intend to expend personal funds totaling [fill in amount].”
• E-Filers:

—Include with Form 2, Statement of Candidacy, a text record disclosing an e-mail address, a fax number and a declaration of intent to expend personal funds.

• The declaration should read: “With respect to this election, I intend to expend personal funds totaling [fill in amount].”

Interim Disclosure Procedures for Other Types of Filers

1. 24-Hour Notice of “Electioneering Communications”

E-mail or fax a report to the FEC disclosing:

• Name, address, occupation and name of employer or principal place of business of the individual or person making the communication;
• Name, address, occupation and name of employer or principal place of business of any person sharing or exercising control over the person making the communication;
• Name, address, occupation and name of employer or principal place of business of the custodian of the books and accounts from which the disbursements for the communication was made;
• If the person making the communication pays for it exclusively from a segregated bank account, the name and address of persons who donate $1,000 or more to that account, including the date and amount of those donations;
• If the person making the communication does not pay for it exclusively from a segregated bank account, the name and address of persons who donate $1,000 or more to the person making the communication (regardless of whether those funds are used to finance the communication), including the date and amount of those donations;
• Disbursements of more than $200, including the name and address of the payee, date, amount and purpose of the disbursement, the name of the federal candidate, and the election identified in the communication;
• Total donations received and disbursements made in this report;
• Aggregate disbursements year-to-date;
• The disclosure date (i.e., the date when the communication was first publicly distributed); and
• The following statement: “Under penalty of perjury, I certify that this report is true, correct and complete.” followed by the name/signature of the person making that statement and the date.^[2]

Dated: November 22, 2002.

David M. Mason,

Chairman, Federal Election Commission.

Footnotes

1.  These procedures also apply to filers involved in special elections held during this period, including the November 30 and January 4 special elections in Hawaii. Those filers should pay special attention to the instructions for disclosing “Federal Election Activity” (defined in 11 CFR 100.24) and “Electioneering Communications” (defined in 11 CFR 100.29), since both are triggered by proximity to an election. See 11 CFR 300.33, 300.36, and proposed 104.20.

2.  Submission of false, erroneous or incomplete information may subject the person signing this report to the penalties of 2 U.S.C. 437g.