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Campaign Operations, Part 1: Campaign Fundraising February 22, 2012 Tab #3.

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Presentation on theme: "Campaign Operations, Part 1: Campaign Fundraising February 22, 2012 Tab #3."— Presentation transcript:

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2 Campaign Operations, Part 1: Campaign Fundraising February 22, 2012 Tab #3

3 2012 FEC Information Division Objectives – Part 1 Review How Contributions Work Review How Contributions Work Evaluate Methods for Curing Excessive Contributions Evaluate Methods for Curing Excessive Contributions Identify Sources of Support Identify Sources of Support Individuals/Persons, PACs, Parties, Unregistered Organizations Individuals/Persons, PACs, Parties, Unregistered Organizations Coordinated v. Independent Expenditures Coordinated v. Independent Expenditures Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting 48-Hour Notices 48-Hour Notices Partnerships/LLCs Partnerships/LLCs Joint Fundraising Joint Fundraising

4 2012 FEC Information Division Contributions – The Basics Per Election LimitsPer Election Limits $2,500 (indexed) from individuals, persons, non-multicandidate committees$2,500 (indexed) from individuals, persons, non-multicandidate committees $5,000 from multicandidate committees$5,000 from multicandidate committees Only for election in which candidate participatesOnly for election in which candidate participates Includes in-kind contributionsIncludes in-kind contributions Accounting MethodAccounting Method If candidate loses primary, must return general election $$ within 60 daysIf candidate loses primary, must return general election $$ within 60 days During primary: cash on hand ≥ general election $$During primary: cash on hand ≥ general election $$

5 2012 FEC Information Division Contributions – The Basics Debt Retirement Contributions: Debt is assigned to an electionDebt is assigned to an election Fundraising to retire debt is allowedFundraising to retire debt is allowed Must be designated for that electionMust be designated for that election Cannot exceed limit for that electionCannot exceed limit for that election Campaign must have net debts outstandingCampaign must have net debts outstanding Net debts outstanding calculation: unpaid debts – cash on hand on election dayNet debts outstanding calculation: unpaid debts – cash on hand on election day

6 2012 FEC Information Division Objectives – Part 1 Review How Contributions Work Review How Contributions Work Evaluate Methods for Curing Excessive Contributions Evaluate Methods for Curing Excessive Contributions Identify Sources of Support Identify Sources of Support Individuals/Persons, PACs, Parties Individuals/Persons, PACs, Parties Unregistered Organizations Unregistered Organizations Coordinated v. Independent Expenditures Coordinated v. Independent Expenditures Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting 48-Hour Notices 48-Hour Notices Partnerships/LLCs Partnerships/LLCs Joint Fundraising Joint Fundraising

7 2012 FEC Information Division Curing Excessives Refund excessive portionRefund excessive portion Redesignate for another electionRedesignate for another election Reattribute to another donorReattribute to another donor

8 2012 FEC Information Division Practical Application Cosmo Kramer for Congress Committee Five thousand and xx/ June , Lisa Smith UNDESIGNATED

9 2012 FEC Information Division Generally, campaigns may presumptively redesignate undesignated contributions received from an individual or non-multicandidate committee to another election within the same election cycle. Presumptive Redesignation

10 2012 FEC Information Division Procedure:Procedure: 1.Designate permissible amount to election; 2.Redesignate excessive amount to another election within cycle; 3.Notify donor—option of refund. Must not cause contributor to exceed limitsMust not cause contributor to exceed limits Date undesignated contribution is made determines applicable election limit. Use postmark date for mailed contributionsDate undesignated contribution is made determines applicable election limit. Use postmark date for mailed contributions Presumptive Redesignation

11 2012 FEC Information Division Cosmo Kramer for Congress Committee Five thousand and xx/ June 4 12 Practical Application 5, Lisa Smith

12 2012 FEC Information Division Procedure available for joint contributions:Procedure available for joint contributions: 1.Attribute permissible amount to the signer; 2.Reattribute excessive amount to the other account holder; 3.Notify both donors—option of refund. Must not cause contributors to exceed limitsMust not cause contributors to exceed limits Presumptive Reattribution

13 2012 FEC Information Division Avoid Excessive Contributions Designate all contributions made to candidatesDesignate all contributions made to candidates Obtain signatures for joint contributions receivedObtain signatures for joint contributions received Designation Required:Designation Required: If donor wants contribution to count toward a future election, beyond the upcoming election.If donor wants contribution to count toward a future election, beyond the upcoming election. If donor wants contribution to retire candidate’s debt from a past election.If donor wants contribution to retire candidate’s debt from a past election.

14 2012 FEC Information Division Reattributions & Redesignations Scenario #1

15 2012 FEC Information Division Reporting Receipts How to Itemize Receipts Itemize regardless of amount : Contributions from party committees and organizations Contributions from party committees and organizations Contributions from other political committees Contributions from other political committees Transfers Transfers Loans Loans All other receipts: Itemize once they exceed $200 when aggregated with other receipts from that same source during an election cycle

16 2012 FEC Information Division Cosmo Kramer for Congress Five hundred and xx/ March 17, 2012 Morty Seinfeld Morty Seinfeld Helen Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista, FL Cosmo Kramer for Congress Five thousand and xx/ ,000 March 29, 2012 Helen Seinfeld Morty Seinfeld Helen Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista, FL Reattribution / Redesignation Primary 2012

17 2012 FEC Information Division Cosmo Kramer for Congress Committee x Morty Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista FL x SelfRetired Receipt – Schedule A, Line 11(a) Reattribution / Redesignation

18 2012 FEC Information Division Cosmo Kramer for Congress Five hundred and xx/ March 17, 2012 Morty Seinfeld Morty Seinfeld Helen Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista, FL Cosmo Kramer for Congress Five thousand and xx/ ,000 March 29, 2012 Helen Seinfeld Morty Seinfeld Helen Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista, FL Reattribution / Redesignation Primary 2012

19 2012 FEC Information Division 2, Homemaker Self Helen Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista FL , X Helen Seinfeld Morty Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista FL X X 2, Self Retired Homemaker , See reattribution and redesignation below MEMO Reattribution and Redesignation below Reattribution MEMO Reattribution / Redesignation X Cosmo Kramer for Congress Committee Homemaker Helen Seinfeld Phase 2 – Pines of Mar Gables Del Boca Vista FL , Redesignation MEMO Self X

20 2012 FEC Information Division Objectives – Part 1 Review How Contributions Work Review How Contributions Work Evaluate Methods for Curing Excessive Contributions Evaluate Methods for Curing Excessive Contributions Identify Sources of Support Identify Sources of Support Individuals/Persons, PACs, Parties Individuals/Persons, PACs, Parties Unregistered Organizations Unregistered Organizations Coordinated v. Independent Expenditures Coordinated v. Independent Expenditures Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting 48-Hour Notices 48-Hour Notices Partnerships/LLCs Partnerships/LLCs Joint Fundraising Joint Fundraising

21 2012 FEC Information Division Limits to Candidates For Elections

22 2012 FEC Information Division Partnerships/LLCs $2,500/election limit on contributions from firm to candidates$2,500/election limit on contributions from firm to candidates Counts as contribution from both the individual and partnership/LLC (attribution based on partner/member losses/profits)Counts as contribution from both the individual and partnership/LLC (attribution based on partner/member losses/profits) No corporate partners/membersNo corporate partners/members LLC treated as corporation - prohibitedLLC treated as corporation - prohibited

23 2012 FEC Information Division Limits to Candidates For Elections

24 2012 FEC Information Division Permissible Sources Unregistered Organizations Must use federally permissible fundsMust use federally permissible funds Counts toward federal registrations thresholdCounts toward federal registrations threshold If nonfederal PAC is sponsored by corp./union: registration with first dollar spend on federal elections or upon formation.If nonfederal PAC is sponsored by corp./union: registration with first dollar spend on federal elections or upon formation. Other nonfederal committees: registration after raises or spends in excess of $1,000 registration threshold.Other nonfederal committees: registration after raises or spends in excess of $1,000 registration threshold.

25 2012 FEC Information Division Permissible Sources Coordinated Spending Coordination: made in cooperation, consultation or concert with, or at the request or suggestion of, a candidate, candidate’s authorized committee, or a political party committee. Results in an in-kind contribution (or coordinated party expenditure).Results in an in-kind contribution (or coordinated party expenditure). Specific rules apply to determine whether a communication is coordinated.Specific rules apply to determine whether a communication is coordinated.

26 2012 FEC Information Division Coordinated Communications If communication is coordinated, it is considered an in-kind, subject to limits.If communication is coordinated, it is considered an in-kind, subject to limits. Coordination three-part test:Coordination three-part test: Source of payment; Source of payment; “Content standard” re: timing and subject matter of communication; AND “Content standard” re: timing and subject matter of communication; AND “Conduct standard” re: interaction between campaign and payee. “Conduct standard” re: interaction between campaign and payee. Permissible Sources

27 2012 FEC Information Division Permissible Sources Conduct Standard Safe Harbors Agreement or formal collaboration nor express advocacy necessary for a communication to be coordinatedAgreement or formal collaboration nor express advocacy necessary for a communication to be coordinated Safe Harbors include:Safe Harbors include: Inquiry re: policy or legislative issuesInquiry re: policy or legislative issues Endorsements and solicitationsEndorsements and solicitations 120-day temporal limit for common vendor/former employee conduct standards120-day temporal limit for common vendor/former employee conduct standards Certain commercial transactionsCertain commercial transactions

28 2012 FEC Information Division Permissible Sources Independent Expenditure A communicationA communication Containing Express AdvocacyContaining Express Advocacy That is not coordinatedThat is not coordinated EXPRESS ADVOCACY No Coordination

29 2012 FEC Information Division Independent Expenditures Example

30 2012 FEC Information Division Objectives – Part 1 Review How Contributions Work Review How Contributions Work Evaluate Methods for Curing Excessive Contributions Evaluate Methods for Curing Excessive Contributions Identify Sources of Support Identify Sources of Support Individuals/Persons, PACs, Parties Individuals/Persons, PACs, Parties Unregistered Organizations Unregistered Organizations Coordinated v. Independent Expenditures Coordinated v. Independent Expenditures Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting 48-Hour Notices 48-Hour Notices Partnerships/LLCs Partnerships/LLCs Joint Fundraising Joint Fundraising

31 2012 FEC Information Division 48-Hour Notices Contributions of $1,000 or more received < 20 days up to 48-hours before an electionContributions of $1,000 or more received < 20 days up to 48-hours before an election FEC Form 6FEC Form 6 Applies to all types of contributions including:Applies to all types of contributions including: Contributions from individuals, entities and committees;Contributions from individuals, entities and committees; Contributions from the candidate;Contributions from the candidate; Loans from the candidate and other non-bank sources; andLoans from the candidate and other non-bank sources; and Endorsements or guarantees of loans from banks.Endorsements or guarantees of loans from banks.

32 2012 FEC Information Division Joint Fundraising Election-related fundraising held jointly by campaign + one or more other committeesElection-related fundraising held jointly by campaign + one or more other committees Joint Fundraising Representative (JFR)Joint Fundraising Representative (JFR) Collects/deposits joint fundraising contributionsCollects/deposits joint fundraising contributions Pays expenses and transfers proceeds to participantsPays expenses and transfers proceeds to participants Participants amend Form 1 to designate JFR as an authorized committeeParticipants amend Form 1 to designate JFR as an authorized committee Written Agreement Outlines allocation formula for proceeds and expenses among all participantsWritten Agreement Outlines allocation formula for proceeds and expenses among all participants

33 2012 FEC Information Division Joint Fundraising Transfer In & 48-Hour Notices Scenario #2

34 2012 FEC Information Division Joint Fundraising: Transfer In Kramer/Costanza Victory Fund 48 West 77 th Street 2, , MEMO New York NY X X X 2, Lloyd Braun 340 Amsterdam Avenue New York NY NYC Mayor’s Office Chief of Staff 1, David Puddy 375 West End Avenue New York NY West End Auto BodyMechanic 1, X Cosmo Kramer for Congress Committee Kramer/Costanza Victory Fund - Joint Fundraiser MEMO Kramer/Costanza Victory Fund - Joint Fundraiser Joint Fundraising Committee

35 2012 FEC Information Division 48-Hour Notices Cosmo Kramer for Congress Committee 129 West 81st Street Apt. 5B New York, NY Cosmo Kramer C NY / 08 Lloyd Braun 340 Amsterdam Avenue New York, NY NYC Mayor’s Office 9/01/12$1, Mr. Newman 9/03/12 FEC Form 6 David Puddy 375 West End Avenue New York, NY Chief of Staff West End Auto Body Mechanic 9/01/12$1,250.00

36 2012 FEC Information Division Workshop Evaluation Help Us Help You! Please complete an evaluation of this workshop.

37 2012 FEC Information Division Break For Lunch Next Workshop: Campaign Operations, Part 2 2:00 - 3:30 PM Lunch in Concerto Ballroom B

38 Campaign Operations, Part 2: Campaign Fundraising February 22, 2012 Tab #3

39 2012 FEC Information Division Objectives – Part 2 Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting Earmarked Earmarked Lobbyist Bundling Lobbyist Bundling Examine Volunteer Exemptions Examine Volunteer Exemptions Identify Ways the Candidate May Support the Campaign Identify Ways the Candidate May Support the Campaign Personal Funds Personal Funds Contributions v. Loans Contributions v. Loans Transfers Transfers

40 2012 FEC Information Division Earmarked Contributions Contributions to a candidate directed by the contributor through an intermediary, or conduit Contribution must be forwarded to campaign within 10 days of conduit’s receipt.Contribution must be forwarded to campaign within 10 days of conduit’s receipt. Conduit must provide campaign with contributor information for FEC report.Conduit must provide campaign with contributor information for FEC report.

41 2012 FEC Information Division Earmarked Contributions Scenario #3

42 2012 FEC Information Division Earmarked Contributions Cosmo Kramer for Congress Committee Mickey Abbott 440 Columbus Avenue New York NY X X , Kramerica Industries PAC 129 West 81 st Street Apt. 5B New York NY X 1, Executive AssistantKramerica Industries 1, Both entries relate to a single receipt. MEMO Earmarked through Kramerica PAC Total earmarked through conduit PAC limit not affected

43 2012 FEC Information Division Lobbyist Bundling Generally, to be a bundled contribution, the intermediary between the contributor and recipient campaign must be a lobbyist, registrant or lobbyist registrant PAC Two Types of Bundled ContributionsTwo Types of Bundled Contributions Forwarded ContributionsForwarded Contributions Received AND Credited ContributionsReceived AND Credited Contributions Exception for Lobbyist/Registrant/PAC’s own contributionsException for Lobbyist/Registrant/PAC’s own contributions

44 2012 FEC Information Division Disclosure Rule If a lobbyist/registrant or lobbyist/registrant PAC forwards or is credited with raising two or more bundled contributions that total more than $16,700 during a covered period, the recipient campaign must report that on FEC Form 3L. Lobbyist Bundling

45 2012 FEC Information Division Covered Periods Semi-annual Periods: Semi-annual Periods: January 1 - June 30 January 1 - June 30 July 1 - December 31 July 1 - December 31 Quarterly Reporting Periods: Quarterly Reporting Periods: Election Year (2012): calendar quarters ending 3/31, 6/30, 9/30 and 12/31 + applicable pre- and post-election reporting periods Election Year (2012): calendar quarters ending 3/31, 6/30, 9/30 and 12/31 + applicable pre- and post-election reporting periods Non-Election Year (2013): calendar quarters ending 3/31, 6/30, 9/30 and 12/31 + applicable special election reporting periods Non-Election Year (2013): calendar quarters ending 3/31, 6/30, 9/30 and 12/31 + applicable special election reporting periods Lobbyist Bundling AND AND

46 Does the reporting committee accept bundled contributions? No obligation to file Form 3L Is the bundler a lobbyist/registrant or lobbyist/registrant PAC? Does the aggregate amount of bundled contributions exceed $16,700 for a covered period? The committee must file Form 3L NO NO NO YES YES YES Lobbyist Bundling Disclosure Flow Chart

47 2012 FEC Information Division Objectives – Part 2 Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting Earmarked Earmarked Lobbyist Bundling Lobbyist Bundling Examine Volunteer Exemptions Examine Volunteer Exemptions Identify Ways the Candidate May Support the Campaign Identify Ways the Candidate May Support the Campaign Personal Funds Personal Funds Contributions v. Loans Contributions v. Loans Transfers Transfers

48 2012 FEC Information Division Volunteer Exemptions  Volunteer Services  Use of Personal Property  Home/Church/Community Room Event  Food/Beverage Vendor Discount  Computer Services  Free Legal and Accounting

49 2012 FEC Information Division Home Exemption In-Kind Contributions & 48-Hour Notices Scenario #4

50 2012 FEC Information Division In-Kind Contribution Receipt: Schedule A, Line 11(a) Disbursement: Schedule B, Line 17 X X X Cosmo Kramer for Congress Committee Tim Whately DentistSelf , West 79 th Street New York NY Tim Whatley 715 West 79 th Street New York NY In-kind: invite for fundraiser w/D. Puddy 1, In-Kind Contribution from an Individual In-kind October Quarterly Report

51 2012 FEC Information Division 48-Hour Notices Cosmo Kramer for Congress Committee 129 West 81st Street Apt. 5B New York, NY Cosmo Kramer Includes Monetary and In-Kind Contributions C NY / 08 Tim Whatley 715 West 79 th Street New York, NY Self Dentist 9/03/12 $1, (in-kind; fundraiser invitations) Mr. Newman 9/05/10 FEC Form 6

52 2012 FEC Information Division Volunteer Exemptions  Volunteer Services  Use of Personal Property  Home/Church/Community Room Event  Food/Beverage Vendor Discount  Computer Services  Free Legal and Accounting

53 2012 FEC Information Division Volunteer Exemptions Computer Services Volunteers may do the following without making a contribution to a candidate: Spend unlimited amount of their own time ing and doing web activities (work time is limited) Spend unlimited amount of their own time ing and doing web activities (work time is limited) Use personal computer on an unlimited basis (use of work computer is limited) Use personal computer on an unlimited basis (use of work computer is limited) Pay Internet service provider fees Pay Internet service provider fees Pay domain name registration fees Pay domain name registration fees

54 2012 FEC Information Division Volunteer Exemptions Legal & Accounting Services Exemption allowing any entity to provide free legal & accounting services to a campaign as long as comply with the limitations.Exemption allowing any entity to provide free legal & accounting services to a campaign as long as comply with the limitations. Includes corporations, committees, unions, and partnerships.Includes corporations, committees, unions, and partnerships. An individual personally volunteering legal or accounting services without compensation does not fit into this exemption.An individual personally volunteering legal or accounting services without compensation does not fit into this exemption.

55 2012 FEC Information Division Objectives – Part 2 Discuss Contributions with Tricky Reporting Discuss Contributions with Tricky Reporting Earmarked Earmarked Lobbyist Bundling Lobbyist Bundling Examine Volunteer Exemptions Examine Volunteer Exemptions Identify Ways the Candidate May Support the Campaign Identify Ways the Candidate May Support the Campaign Personal Funds Personal Funds Contributions v. Loans Contributions v. Loans Transfers Transfers

56 2012 FEC Information Division Candidate Support Unlimited Personal FundsUnlimited Personal Funds ½ of Jointly Held Assets½ of Jointly Held Assets Contributions vs. LoansContributions vs. Loans Both unlimited from candidate’s personal funds; butBoth unlimited from candidate’s personal funds; but Amounts disclosed as loans can be repaid; amounts disclosed as contributions cannot.Amounts disclosed as loans can be repaid; amounts disclosed as contributions cannot.

57 2012 FEC Information Division Repayment of Candidate Loans ► Using contributions made before election: ► May repay entire amount ► Using contributions made after the election: ► May repay no more than $250,000 ► Balance = contribution Candidate Support

58 2012 FEC Information Division Candidate Support: Transfers  Nonfederal Campaign to PCC – prohibited From Prior Federal Campaign in Different Cycle From Prior Federal Campaign in Different Cycle UnlimitedUnlimited No aggregation of contributor limitsNo aggregation of contributor limits From Candidate’s Campaign for Different Office From Candidate’s Campaign for Different Office In the Same/Overlapping Election CycleIn the Same/Overlapping Election Cycle Must set up separate committeeMust set up separate committee No transfers while actively seeking more than one officeNo transfers while actively seeking more than one office Aggregation of contributor limitsAggregation of contributor limits In different cycles – unlimited; no aggregationIn different cycles – unlimited; no aggregation

59 2012 FEC Information Division Candidate Loan of Personal Funds Scenario #5

60 2012 FEC Information Division Candidate Loan of Personal Funds Cosmo Kramer for Congress x Cosmo Kramer 129 West 81 st Street Apt. 5B New York NY x , personal funds 10, Kramerica Industries Founder Receipt – Schedule A, Line 13(a) Part 1 of 2: Report as Contribution

61 2012 FEC Information Division x x Cosmo Kramer for Congress Committee Cosmo Kramer – personal funds 129 West 81 st Street Apt. 5B New York NY , None None x Loan Reporting – Schedule C, Line 13a Part 2 of 2: Report as Loan Candidate Loan of Personal Funds

62 2012 FEC Information Division Candidate Loan from Bank Cosmo Kramer for Congress Committee Cosmo Kramer Kramerica Industries Founder x 60, , Loan from Bank x Receipt - Schedule A, Line 13(a) Part 1 of 3: Report as Contribution 129 West 81 st Street Apt. 5B New York NY 10024

63 2012 FEC Information Division 50, , x x x Loan Reporting – Schedule C, Line 13(a) Part 2 of 3: Report as Loan Cosmo Kramer for Congress Committee Cosmo Kramer (Loan from Bank) 129 West 81 st Street Apt. 5B New York NY Candidate Loan from Bank

64 2012 FEC Information Division Chemical Bank 120 West 81 st Street New York NY x x x x x 50, Real estate , Mr. Newman Part 3 of 3: Schedule C-1 Loan Agreement - Bank & Candidate Cosmo Kramer for Congress Committee Candidate Loan from Bank

65 2012 FEC Information Division 50, , , x x x Loan Reporting – Schedule C, Line 13(a) Part 1 of 2: Report Payment on Schedule C Cosmo Kramer for Congress Committee Cosmo Kramer (Loan from Bank) 129 West 81 st Street Apt. 5B New York NY Candidate Loan from Bank

66 2012 FEC Information Division Candidate Loan from Bank Cosmo Kramer for Congress Committee Cosmo Kramer x NY , x Principal Payment – Schedule B, line 19(a) Cosmo Kramer for Congress Committee Cosmo Kramer 129 West 81 st Street Apt. 5B Cosmo Kramer x x x NY New York NY Interest Payment – Schedule B, line 17 x Loan Payment - Candidate Loan from Bank Interest Payment on Bank Loan 129 West 81 st Street Apt. 5B New York NY Part 2 of 2: Report Payment on Schedule B Principal v. Interest Payments

67 2012 FEC Information Division Workshop Evaluation Help Us Help You! Please complete an evaluation of this workshop.

68 2012 FEC Information Division Tomorrow Morning “Breakfast with the IRS” and “Campaign Operations, Part 3” 8:00 AM


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