Federal Election Commission Main Page
FEDERAL ELECTION COMMISSION
Washington, DC 20463
January 12, 2004
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
ADVISORY OPINION 2003-36
Edward T. Tobin, III
Executive Director
Republican Governors Association
555 11th Street, N.W,
Suite 700
Washington, D.C. 20004
Dear Mr. Tobin:
This responds to your letters dated October 16 and November
12, 2003, on behalf of the Republican Governors Association
("RGA"), requesting an advisory opinion concerning the
application of the Federal Election Campaign Act of 1971, as
amended ("the Act"), and Commission regulations to the
participation of Federal candidates and officeholders in
fundraising activities on behalf of RGA.
Background
You state that RGA is an independent, unincorporated
association that is the official political and public policy
organization of the Republican State Governors. It was
established in 1963 and was an "auxiliary" organization of the
Republican National Committee. You assert that, prior to
November 6, 2002, the effective date of the Bipartisan Campaign
Reform Act of 2002 ("BCRA"), RGA severed its ties to the RNC. In
October 2002, RGA established itself as a "political
organization" under 26 U.S.C. 527. You assert that RGA is not
affiliated with a national, State, or local political party
committee, is not a Federal political committee, "does not raise
funds pursuant to [the Act]," does not participate in Federal
elections, and is operated and governed independently of any
Federal political committee, candidate, or officeholder. You
state that RGA has not engaged, and does not anticipate engaging,
in "Federal election activity" ("FEA") as defined in 2 U.S.C.
431(20) and 11 CFR 100.24.
RGA's mission is to aid Republican Governors, gubernatorial
candidates, and other State candidates by: (1) assisting in their
elections as permitted by the laws of the different States
through direct contributions and participation in the discussion
of State and local issues; (2) providing policy assistance
through conferences, debates, and public messages, and (3)
providing a platform for the Governors to express, develop, and
promote their governing philosophies.
You state that RGA raises "exclusively non-federal funds"
through a series of fundraising events. It deposits these funds
into several accounts that allow it to participate in elections
under the laws of the 50 States.
RGA also maintains a segregated Conference Account. You
state that funds in the Conference Account are not used to
influence any election but rather to pay for the administrative
and event costs associated with the RGA's Annual Conference and
its series of Governors Forums that are conducted throughout the
country. The large majority of Conference Account expenses pay
for hotel fees, catering, and meeting space usage. You state
that the events funded by the Conference Account are policy
discussions and not political events, and do not include planning
for campaigning or fundraising, or the solicitation of funds for
Federal or non-Federal candidates or political committees.
Conference speeches and presentations are not made by RGA staff.
They center on State and local public policy issues, and not
elections, and do not include advocacy of the election or defeat
of Federal candidates. You state that, if any speaker includes
advocacy of the election or defeat of State candidates, such
advocacy is beyond the purpose for which the speaker is invited.
Funds received and disbursed by the Conference Account are not
incorporated into RGA's reports filed with the States in which it
conducts its activities. However, funds received and disbursed
by the Conference Account are included in RGA's filings with the
IRS and are not separated out from the other activities of RGA in
those filings.
Your request presents questions about fundraising for both
RGA and for RGA's Conference Account by Federal candidates,
Federal officeholders, and their agents ("covered individuals")
in a variety of activities. In addition to the facts presented
above, you have indicated that the following predicate
assumptions apply with respect to the first question (1.a., 1.b.,
and 1.c.).
ú First, the funds raised will be either explicitly solicited
for the purpose of assisting only in the election of State
candidates or in messages on State issues mentioning only State
officials; or solicited only for RGA and not to support any
specific State candidates.
ú Second, donations that exceed the Federal contribution
limits or come from prohibited sources will be solicited, but, in
solicitations by covered individuals, notice will be given to the
solicitees that the covered individual is not raising funds
outside the Act's amount limits or from sources prohibited by the
Act.
ú Third, the solicitations by the covered individuals, whether
oral or in writing, will refer to non-Federal candidates
(particularly the candidates in the States where the solicitation
is sent or aired) but will not refer to any Federal candidates
(other than the covered individual in the context of the
solicitation).
ú Fourth, funds solicited "only for the RGA and not to support
any specific State candidates" will be used for RGA's
administrative and overhead expenses. They may also be used to
pay for public communications that would include a mass mailing
fundraising letter not mentioning any Federal candidate and
signed by the RGA Chair, or an issue message concerning a State
issue.
With respect to your second question, pertaining to proposed
solicitations by Federal candidates, officeholders, or their
agents specifically for the Conference Account, you state that
neither Federal nor non-Federal candidates will be mentioned
(other than the covered individual in the context of the
solicitation).
Legal Analysis and Conclusions
1. May a covered individual participate (a) as a featured guest
at an RGA fundraising event; (b) by having his name appear on a
written solicitation for an RGA fundraising event as the featured
guest or speaker; or (c) by signing a written fundraising
solicitation for RGA?
On November 6, 2002, BCRA took effect. As amended by BCRA,
the Act regulates certain actions of Federal candidates and
officeholders,1 their agents,2 and entities directly or
indirectly established, financed, maintained, or controlled by
them3 when they raise or spend funds in connection with either
Federal or non-Federal elections. 2 U.S.C. 441i(e)(1). 4 Both
BCRA and the Commission's rules implementing BCRA prohibit
covered individuals from soliciting, receiving, directing,
transferring, or spending: (A) funds in connection with an
election for Federal office, including funds for any Federal
election activity,5 unless the funds are subject to the
limitations, prohibitions, and reporting requirements of the Act,
and (B) funds in connection with any election other than an
election for Federal office unless the funds are not in
excess of the amounts permitted with respect to contributions to
candidates and political committees under 2 U.S.C. 441a(a)(1),
(2), and (3), and are not from sources prohibited by the Act from
making contributions in connection with an election for Federal
office. 2 U.S.C. 441i(e)(1)(A) and (B); 11 CFR 300.61 and
300.62.6
Commission regulations state that to "solicit" means "to ask
that another person make a contribution, donation, transfer of
funds, or otherwise provide anything of value," whether done so
directly or through a conduit or intermediary. 11 CFR 300.2(m)
(emphasis added). Similarly, "to direct means to ask a person
who has expressed an intent to make a contribution, donation, or
transfer of funds, or to provide anything of value, to make that
contribution, donation, or transfer of funds, or to provide that
thing of value . . . ." 11 CFR 300.2(n) (emphasis added). See
also McConnell v. Federal Election Commission, _ U.S_, 124 S. Ct.
619, 670 (2003). Neither "to solicit" nor "to direct" includes
merely providing guidance or information about the law. 11 CFR
300.2(m) and (n). See Advisory Opinion 2003-03.
By defining "to solicit" and "to direct" as "to ask," the
regulations establish that a Federal candidate will not be held
liable for soliciting funds in violation of 2 U.S.C. 441i(e) or
11 CFR 300.62 merely by virtue of attending or participating in
any manner in connection with a fundraising event at which non-
Federal funds are raised. Nor will a Federal candidate or
officeholder be held liable based on private conversations that
would require an examination to infer the Federal candidate's or
officeholder's intent. The Commission was concerned that
imputing intent when a private conversation is not clear on its
face could lead to finding a violation when the candidate
involved had no intention of soliciting contributions. "Such a
result is not dictated by BCRA's statutory language and would
raise constitutional concerns." "Prohibited and Excessive
Contributions: Non-Federal Funds or Soft Money; Final Rule," 67
Fed. Reg. 49064, 49086-87 (July 29, 2002). To be liable, the
Federal candidate must "ask" for non-Federal funds. Id., see
also, "Prohibited and Excessive Contributions: Non-Federal Funds
or Soft Money; Proposed Rule," 67 Fed. Reg. 35654, 35660, 35681
(May 20, 2002). Thus, the scope of a covered individual's
potential liability under 2 U.S.C. 441i(e)(1) and 11 CFR 300.62
must be determined by his or her own speech and actions in asking
for funds or those of his or her agents, but not by the speech or
actions of another person outside his or her control. 7
See Advisory Opinions 2003-03 and 2003-05.
One of the factual predicates of questions 1.a., 1.b., and
1.c. is that explicit notice will be given that the covered
individual is not soliciting funds outside the limits and
prohibitions of the Act. In Advisory Opinion 2003-03, the
Commission addressed appearances, speeches, and solicitations by
a Federal candidate or officeholder at fundraising events for non-
Federal candidates where Federally impermissible funds were being
raised. The Commission interpreted the Act and regulations to
permit oral solicitations, and signatures on written
solicitations, by a covered individual, so long as the
solicitations included or were accompanied by a message
adequately indicating that the covered individual is only asking
for Federally permissible funds. See 2 U.S.C. 441i(e)(1)(B); 11
CFR 300.62. The following is considered to be an adequate
disclaimer:
I am asking for a donation of up to $5,000 per year. I
am not asking for funds from corporations, labor
organizations, or other Federally prohibited sources.
1.a. May a covered individual participate as a featured
guest at an RGA fundraising event?
Your description of RGA's activities (other than those
of the Conference Account) indicates that they are in
connection with the election of gubernatorial and other
State candidates. Hence, 2 U.S.C. 441i(e)(1)(B) applies to
the proposed activities described in questions 1.a., 1.b.,
and 1.c.
A covered individual may, subject to certain conditions,
appear as a featured guest or speaker at the events you describe.
The mere attendance of the covered individual at a fundraiser
where non-Federal funds are raised does not, in and of itself,
give rise to a violation of 2 U.S.C. 441i(e)(1) or 11 CFR 300.62,
and the covered individual may participate in any activities at
such an event provided that he or she does not solicit, direct,
receive, transfer, or spend funds outside the Act's limits and
prohibitions.
If the covered individual makes a speech without asking for
donations to RGA, he does not need to issue a disclaimer stating
that he is not raising funds outside the limitations or
prohibitions of the Act, even though speeches by others solicit
such funds. If the covered individual gives a speech soliciting
funds generally without mentioning specific amounts, sources, or
limitations, he may do so if written notices are clearly and
conspicuously displayed at the event indicating that the covered
individual is soliciting only Federally permissible funds.8
Alternatively, if no written notices are so displayed, the
covered individual must make an oral disclaimer similar to the
one described above and referred to in your request. If such a
public oral disclaimer is made, it need only be made once, and it
is not required that it be made during a covered individual's one-
on-one discussions with donors or other people at the event.
This should not, however, be construed to permit a covered
individual to inoculate a solicitation of non-Federal funds by
reciting a rote limitation, but then encouraging the potential
donor to disregard the limitation. See generally Advisory
Opinion 2003-03.
The requirements of 2 U.S.C. 441i(e)(1), as interpreted in
Advisory Opinion 2003-03, apply regardless of whether funds are
solicited for the purposes of assisting only in the election of
State candidates or in messages on State issues mentioning only
State officials; or solicited only for the RGA and not to support
any specific State candidates.
1.b. May a covered individual participate by having his name
appear on written solicitations for an RGA fundraising event as
the featured guest or speaker?
Yes, he may so participate under certain conditions.
Section 441i(e)(1) and section 300.62 do not apply to
publicity for an event where that publicity does not constitute a
solicitation or direction of non-Federal funds by a covered
individual, nor to a Federal candidate or officeholder merely
because he or she is a featured guest at a non-Federal
fundraiser. Whether characterized as "publicity" or as a
solicitation, the applicable analysis as to the covered
individual is two-fold: (1) whether the writing or publicity
constitutes a solicitation for funds; and (2) whether the covered
individual approved, authorized, or agreed or consented to be
featured, or named in, the writing or publicity (e.g., through
the use of his name or likeness).
A Federal candidate may not solicit funds in excess of the
amount limitations or in violation of the source prohibitions of
the Act. If the covered individual approves, authorizes, or
agrees or consents to be named or featured in a solicitation, the
solicitation must contain a clear and conspicuous express
statement that it is limited to funds that comply with the amount
limits and source prohibitions of the Act. The mere mention of a
covered individual in the text of a written solicitation does
not, without more, constitute a solicitation or direction of non-
Federal funds by that covered individual. See generally Advisory
Opinion 2003-03.9
Complying with these requirements regarding the written
solicitation or publicity does not relieve the covered individual
of the requirements as to his or her actual appearance at the
subsequent event as a featured guest or speaker, set out in the
response to question 1.a. The requirements set out in that
response as to the speech and disclaimer by the covered
individual, clear and conspicuous written notices, and
conversations by the covered individual are still applicable.
For the reasons stated above in response to question 1.a.,
the requirements apply regardless of whether the funds are
solicited for the purposes of assisting only in the election of
State candidates or in messages on State issues mentioning only
State officials; or solicited only for the RGA and not to support
any specific State candidates.
1.c. May a covered individual participate by signing a
written fundraising solicitation for RGA?
Yes, a covered individual may sign a written fundraising
solicitation for RGA provided that the covered individual
complies with the requirements stated in response to question
1.b.
2. With respect to the RGA Conference Account, may a covered
individual sign or appear on written solicitations, such as
signing invitation letters, or appear as a featured guest or
speaker at a fundraising event, where the donations solicited
exceed the Act's amount limits or are from prohibited sources but
the solicitation does not include a notice that the covered
individual is not raising funds outside the amount limits and
source prohibitions of the Act?
No, the covered individual may not so participate under
those circumstances. The requirements described above in
response to questions 1.a, 1.b, and 1.c are applicable to the
situations described in question 2, including the need for the
notice that the covered individual is asking for funds only up to
the applicable limits of the Act, and is not asking for funds
outside the limitations or prohibitions of the Act.
As recognized by the Supreme Court in McConnell v. Federal
Election Commission,
[s]ection 527 political organizations are, unlike
501(c) groups, organized for the express purpose of
engaging in partisan political activity. They include
any "party, committee, association, fund, or other
organization (whether or not incorporated) organized
and operated primarily for the purpose of directly or
indirectly accepting contributions or making
expenditures" for the purpose of "influencing or
attempting to influence the selection, nomination, or
appointment of any individual for Federal, State, or
local public office. 26 U.S.C. 527(e).
McConnell, 124 S.Ct., at 678, n.67. In contrasting 527
organizations with 501(c) organizations, the Court, in McConnell,
further noted that the former are organizations "which by
definition engage in partisan political activity." Id, at 679.
In October 2002, the RGA filed a Form 8871 with the Internal
Revenue Service by which it registered as a section 527
organization. On the form, RGA states its purpose as follows:
"The Republican Governors Association supports the election of
Republican Governors and other nonfederal candidates, promotes
Republican policies, and engages in other state and local
election activities." Additionally, the requestor may have
claimed that Conference Account income is exempt function income
under 26 U.S.C. 527. In the absence of other legal or factual
considerations, the Commission would accept this characterization
of the requestor's Conference Account activities. As such,
donations or "contributions" to the Conference Account must be
treated in the same manner as donations for other purposes of
RGA. Therefore, the solicitation of funds for the Conference
Account constitutes fundraising in connection with an election
other than an election for Federal office under 2 U.S.C.
441i(e)(1)(B) and 11 CFR 300.62.
3. May RGA's Conference Account accept donations from
corporations organized by authority of Congress, such as the
Federal Home Loan Mortgage Corporation and the Federal National
Mortgage Association?
The Act, at 2 U.S.C. 441b(a) prohibits "any corporation
established by authority of any law of Congress" from making a
contribution in connection with any election to any political
office. As indicated above, contributions or donations to RGA's
Conference Account would be in connection with an election other
than an election to Federal office. Therefore, the Conference
Account may not accept contributions or donations from the
Federal Home Loan Mortgage Corporation and the Federal National
Mortgage Association.
This response constitutes an advisory opinion concerning the
application of the Act and Commission regulations to the specific
transaction or activity set forth in your request. See
2 U.S.C. 437f. The Commission emphasizes that, if there is a
change in any of the facts or assumptions presented and such
facts or assumptions are material to a conclusion presented in
this advisory opinion, then the requester may not rely on that
conclusion as support for its proposed activity.
Sincerely,
(signed)
Bradley A. Smith
Chairman
Enclosures (AOs 2003-05 and 2003-03)
_______________________________
1 Under 2 U.S.C. 431(3), "Federal office" means "the office of
President or Vice President, or of Senator or Representative in,
or Delegate or Resident Commissioner to, the Congress." See also
11 CFR 100.4.
2 11 CFR 300.2(b)(3).
3 11 CFR 300.60.
4 The Act, as amended by BCRA, and Commission regulations also
prohibit national committees of political parties, its officers
and agents, and any entities established, financed, maintained or
controlled by such committees from soliciting, receiving,
spending, or directing to another person, non-Federal funds
(i.e., funds that that are not subject to the limitations,
prohibitions, or reporting requirements of the Act. 2 U.S.C.
441i(a); 11 CFR 300.10. For the purposes of this opinion, the
Commission accepts your representation that RGA has severed its
ties to the RNC and is not an entity that is established,
financed, maintained, or controlled by the RNC, but does not make
a determination as to this issue.
5 2 U.S.C. 431(20); 11 CFR 100.24.
6 Under the Act, the following persons may not contribute in
connection with a Federal election: National banks,
corporations, and labor organizations (2 U.S.C. 441b); Federal
government contractors (2 U.S.C. 441c); and foreign nationals (2
U.S.C. 441e). It is unlawful for the following persons to
contribute or donate in connection with any election: National
banks and corporations organized by authority of Congress (2
U.S.C. 441b); and foreign nationals (2 U.S.C. 441e).
7 In implementing BCRA, including section 441i(e)(1), the
Commission defined "agent," as "any person who has actual
authority, either express or implied," to act on behalf of a
covered person. See 11 CFR 300.2(b). The Commission made clear
that under BCRA, an agent "does not apply to individuals who do
not have any actual authority to act on their [principal's]
behalf, but only `apparent authority'" to do so. Explanation and
Justification, 67 Fed. Reg. 49064, 49082 (July 29, 2002). The
Commission also made clear that a principal may only be held
liable under BCRA for the actions of an agent when the agent is
acting on behalf of the principal. Id. at 49083. "[I]t is not
enough that there is some relationship or contact between the
principal and agent; rather, the agent must be acting on behalf
of the principal to create potential liability for the principal.
This additional requirement ensures that liability will not
attach due solely to the agency relationship, but only to the
agent's performance of prohibited acts for the principal." Id.
8 See 11 CFR 110.11(c) for the Commission's interpretation of
"clear and conspicuous" in related contexts.
9 Although Advisory Opinion 2003-03 might be read to mean that a
disclaimer is required in publicity or other written
solicitations that explicitly ask for donations "in amounts
exceeding the Act's limitations and from sources prohibited from
contributing under the Act," that was not the Commission's
meaning. The Commission wishes to make clear that the covered
individual may not approve, authorize, agree, or consent to
appear in publicity that would constitute a solicitation by the
covered person of funds that are in excess of the limits or
prohibitions of the Act, regardless of the appearance of such a
disclaimer. However, the Commission could not agree whether the
use of a covered person's name in a position not specifically
related to fundraising, such as "honorary chairperson," on a
solicitation not signed by the covered person, is prohibited
under the Act.