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Federal Election Commission - RNC and PFC Payment of Presidential Travel Expenses (4)
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Federal Election Commission - RNC and PFC Payment of Presidential Travel Expenses (4)
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Philip W. Buchen Files
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The original documents are located in Box 16, folder "Federal Election Commission - RNC
and PFC Payment of Presidential Travel Expenses (4)" of the Philip Buchen Files at the
Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald R. Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 16 of the Philip Buchen Files at the Gerald R. Ford Presidential Library
THE WHITE HOUSE
WASHINGTON
October 16, 1975
MEMORANDUM FOR: DON RUMSFELD
BOB HARTMANN
DICK CHENEY
JIM CONNOR
RON NESSEN
FROM:
PHIL BUCHEN T.W.B.
SUBJECT:
PFC Comments on
RNC Expenditures
Attached is a draft letter from the PFC commenting on RNC
expenditures in support of the President as head of the party.
I would appreciate any comments you might have by C.O.B.
today in order that this letter can meet tomorrow's filing
deadline.
Thank you.
NO comments
(FROM Ron nessen
SERVICE R. FORD LIBRARY
DRAFT - 3
RPV - 10/16/75
Office of General Counsel,
Advisory Opinion Section
The Federal Election Commission
1325 K Street, N. W.
Washington, D. C. 20463
Re: AOR 1975-72
Gentlemen:
The President Ford Committee hereby submits the following
comments in support of the position taken by the Chairman of
the Republican National Committee, Mary Louise Smith, in her
September 15 letter regarding the historical role of the Presi-
dent of the United States in his capacity as head of his
national party. It is our understanding that the Democratic
Senatorial Campaign Committee ("DSCC") has submitted comments
alleging violation of certain provisions of the Federal Election
Campaign Act of 1971, as amended, (the "Act") by both the
Republican National Committee ("RNC") and The President Ford
Committee ("PFC"). In particular, both the RNC and the princi-
pal campaign committee for the President were recklessly charged
by the DSCC with a knowing criminal violation of Section 608 (b) (2)
of Title 18, United States Code, regarding the payment by the
RNC of Presidential travel expenses solely involving Republican
Party political activities. Such assertions are without merit
and lack any substantive legal or factual basis.
- 2 -
It is our position, as demonstrated below, that such
payments by the President's national party are both proper
and lawful. Moreover, such payments recognize the three
traditional and important functions of any incumbent President.
He is President, the leader of his national party and possibly
a Presidential candidate.
First, it is clear that the limitation set forth in
Section 608 (b) (2) regarding contributions by a political
committee to a federal candidate relate solely to payments:
"
made for the purpose of influencing
the nomination for election, or election,
of any person to Federal office or for the
purpose of influencing the results of a
primary held for the selection of delegates
to a national nominating convention of a
political party or for the expression of a
preference for the nomination of persons
for election to the office of President
"
of the United States;
18 U.S.C. §591 (e) (1) (Emphasis Added)
Similarly, the definition of "expenditure" in Title 18 excludes
any payment from being charged against the candidate's primary
expenditure limitation of Ten Million Dollars ($10,000,000)
unless it is in furtherance of one of the above cited purposes.
Moreover, the definition of expenditure also explicitly
excludes "any communication by any person which is not made
for the purpose of influencing the nomination for election,
or election, of any person to Federal office". 18 U.S.C.
§591 (f) (4) (F) As set forth in greater detail in Mrs.
FORD LIBRARY
Smith's letter, the RNC has not and will not assume the
- 3 -
expenses of Presidential travel in connection with either
the candidacy of the President himself or with the candidacy
of any other individual. In the latter circumstances, of
course, the appropriate contribution and expenditure provisions
of the Act would apply on an allocable basis.
Second, the strength of the RNC position is underscored
by the legislative history of the Act itself. One of the
important goals of the legislative reform sought by the
1974 amendments was to strengthen the national, state and
local party structures and their impact upon the political
process while, at the same time, stemming the unchecked
flow of undisclosed private funds from being covertly
channeled into a federal candidate's coffers.
In the Senate Report on the 1974 Amendments, it was
stated in a paragraph entitled "Strengthening Political
Parties" that the Senate Committee "agrees that a vigorous
party system is vital to American politics and has given
this matter careful study." The Committee stated that
"the parties will play an increased role in building strong
coalitions of voters and in keeping candidates responsible
to the electorate through the party reorganization". Finally,
they noted
- 4 -
'[P]arties [such as the RNC] will continue to
perform crucial functions in the election apart
from fundraising, such as registration and voter
turnout campaigns, providing speakers, organizing
volunteer workers and publicizing issues. Indeed,
the combination of substantial public financing
with limits on private gifts to candidates will
release large sums presently committed to individual
campaigns and make them available for donation to
the parties, themselves. As a result, our financially
hard-pressed parties will have increased resources
not only to conduct party-wide election efforts,
but also to sustain important party operations in
between elections.
Senate Report 93-689 at 7-8 (Emphasis Added)
The traditional and one of the most effective methods by
which a national party obtains funds to support such activities
and strengthen its political base is by inviting interested
persons to fundraising events at which party leaders, and in
particular, an incumbent President, speak on issues of concern
to the Party. To date, it is my understanding that such
activities on behalf of the RNC by President Ford have raised
over $2,250,000 for his Party. The pragmatic effect of any
blanket rule denying the RNC the party services of its chief
spokesman would be to dramatically undercut and weaken that
which the Act sought to promote and strengthen.
Thus, the RNC should be permitted to pay for expenses
incurred by the President and his aides for party promotional
activity since such activities are undertaken at the singular
request of the RNC for its own purposes and benefit. In
fact, the PFC has not been involved in any efforts to initiate
- 5 -
and/or coordinate any of the President's recent trips on
behalf of the RNC. Such invitations and acceptances are
independent judgmental determinations made by the RNC
and White House in connection with party matters and for
party purposes. Moreover, such activities are totally
unrelated to the PFC campaign efforts which are directed
towards the raising of money and the scheduling of activities
for the purpose of influencing the nomination of the
President for a full term.
Third, the test for determining whether or not a contri-
bution or expense is a campaign expense related to a federal
candidate's election and therefore chargeable to the aggregate
limitations set forth in the Act, is one of intent and purpose.
Although, as Mrs. Smith noted with regard to the differing roles
of the President, such distinctions are sometimes subtle,
they are nonetheless real and subject to dispassionate analysis.
No inflexible rule should be issued by the Commission which
would obviate and eliminate partisan but non-candidate related
activities. Instead, it is our considered opinion that a
- 6 -
clear distinction exists between the activities of a President
in his official capacity, the activities of a President in his
party leader capacity and, finally, the activities of a
President as a candidate for nomination. Further, reason
dictates that any such determination by the Commission
in this regard must be made on a case by case basis.
It was recognized in the Opinion of Counsel issued
to the campaign manager of the Wyman-for-Senator Committee,
that the fact that there will always be the possibility
or even likelihood of "some carryover effect" or other
incidental benefit to the President in connection with his
appearance in New Hampshire on behalf of that candidate is
immaterial when the timing of such a visit would have no significan
demonstrable or measurable effect on the 1976 Presidential
election, nominating convention or New Hampshire primary
election. Although that opinion was restricted to a particular
set of circumstances and was not deemed necessarily applicable
to other campaign activity engaged in by a Presidential
candidate, the logical conclusion is that a similar approach
and analysis must be taken toward non-campaign activity by
a federal candidate. In fact, there are no applicable
contribution or expenditure limitations for ongoing party
business and activities which are not for the purpose of
influencing the election of a federal candidate.
The distinction between official acts by a federal
office holder and candidate related activities is reflected
- 7 -
in both the legislative history of the Act (see, e.g. H.R.
93-1279 at 150) and in the initial Task Force draft regarding
Allocation of Expenditures. Moreover, an equally real and
viable distinction exists between candidate related activities
and party related activities, particularly during the primary
period prior to the nomination at the national parties'
annual conventions.
Fourth, in order to determine whether or not partisan
political activity is directed toward party activity or an
individual's own candidacy, we would respectfully suggest
that the following approach be considered in connection with
the Commission's Advisory Opinion in this matter and as a
basis for any proposed regulation in this area. The cost of
promotional or other partisan activities on behalf of a
national, state or local party by a candidate for federal
office, whether or not a holder of public office, shall not
be attributable as a campaign expenditure by such candidate
if the activity is (1) at the sole invitation of such party,
(2) for a recognized and legitimate purpose on behalf of
the party and not for the purpose of directly raising funds
for such candidate or for the purpose of influencing his
election, provided that, notwithstanding the above, the costs
of any such activities by a candidate who has registered and
qualified as a candidate or been placed on the ballot in the
- 8 -
state in which such activity is held, shall be deemed an
expenditure from the date of registration or placement
on the ballot, in any event, at any time such activities
are undertaken in that state within forty-five (45) days
prior to the date of the respective state presidential
primary.
This approach recognizes the importance and value
of party promotional activity by federal candidates, while
at the same time providing a pragmatic time frame within
which any such activity would be deemed candidate related.
In addition, of course, any alleged party activity which
is demonstrated to be for the purpose of influencing the
candidate's own election would be appropriately allocated
and charged against the Act's contribution and expenditure
limitations. This is in accordance with the approach
recently discussed by the Commission regarding "unearmarked"
contributions to the national committee of such a candidate.
Accordingly, in the foregoing discussion we have
established that payment by the RNC of expenditures incurred
by the President and his aides, when solely engaged in national,
state or local political party promotional activities, are
not subject to the Acts contribution and spending limits.
Hence, the FEC should confirm in its Advisory Opinion that
it is legally permissible for the RNC to continue to make
such expenditures. Moreover, in any event, the Commission
should also rule that the effect of an Advisory Opinion
in this matter must be prospective only.
- 9 -
In the first place, the statutory language of Section
437 (f) of Title 2, United States Code, which authorizes the
FEC to render Advisory Opinions clearly reflects the fact
that such Advisory Opinions look only to future acts, and
not past acts. Section 437 (f) states, in pertinent part, that:
"(a) Upon written request to the
Commission
the Commission shall render
an advisory opinion, in writing, within a
reasonable time with respect to whether any
specific transaction or activity
would
constitute a violation
"
(Empahsis Added)
The words "would constitute" do not encompass acts
that occurredin the past. As the Comptroller General
has frequently ruled that the question of retroactivity is
strictly a function of the interpretation of the relevant
statute in question, the conclusion that all Advisory Opinions
must be solely prospective in application is compelling (See, e.g.
49 Comp. Gen. 505 (1970), 48 Comp. Gen. 477 (1969), 48
Comp. Gen. 15 (1968) and 47 Comp. Gen. 386 (1968))
Moreover, even if, arguendo, Advisory Opinions are
not limited to matters of prospective application only in
all matters subject to such rulings, the Commission still
has full discretion to limit its opinions to matters in the
future in appropriate cases. The United States Supreme
Court, in Chenery V. SEC, 332 U.S. 194 (1947), held that
an agency of the federal government may, in its discretion,
- 10 -
give a ruling prospective effect only. The Court stated
that the agency, in exercising this discretion, should
follow a balancing test, which involves weighing "the
mischief of producing the result which is contrary to a
statutory design or to legal and equitable principles"
against "the ill effect of the retroactive application of
a new standard
"
(332 U.S. at 203).
The foregoing test is similar to the criteria followed
by the United States Supreme Court on the question of whether
a particular judicial holding should be given retroactive
application. Recently the Court stated that the following
matters should be considered in this regard:
"(a) The purpose to be served by the
new standards, (b) the extent of the reliance
by law enforcement authorities on the old
standards, and (c) the effect on the adminis-
tration of justice of a retroactive applica-
tion of the new standards" Gosa V. Mayden,
413 U.S. 655, 679 (1973), quoting, 388 U.S.
at 297.
At issue before the Commission is the appropri-
ateness of the application of the Act's contribution and
expenditure limitations set forth in 18 U.S.C. 608 to a
Presidential candidate's travel for party purposes. Title
18, of course, is a criminal statute and
in
FORD
LIBRARY
- 11 -
provides for extensive criminal penalties including imprison-
ment and fines. As with all criminal statutes, a principal
feature of that section is that a violation cannot occur
unless it is a "knowing violation". In this respect, sub-
section (h) of Section 608 states as follows:
'(h) No candidate or political committee
shall knowingly accept any contribution or
make any expenditure in violation of the
provisions of this section. No officer or
employee of a political committee shall
knowingly accept a contribution made for the
the benefit or use of a candidate, or knowingly
made any expenditure on behalf of a candidate,
in violation of any limitation imposed on contri-
butions and expenditures under this section."
(Emphasis Added)
Any person found violating any perovision of this
section shall be fined not more than $25,000 or imprisoned
not more than 1 year, or both (18 U.S.C. §608(i)).
The enforcement powers of the Commission set forth in
24 U.S.C. $437g
also make it clear that the Commission
may not order repayment of any such past payments in any
event for a violation of Section 608. Appropriate apparent
violations of Section 608 are to be referred to the appropriate
law enforcement authorities. In the present instance any such
referral would be ludicrous. Accordingly, the Commission
would be committing an abuse of discretion if it should attempt
-12-
to retroactively apply any new standard against The President
Ford Committee or the RNC in this instance.
The President Ford Committee and the RNC have at all
times acted in good faith in accordance with their understanding
of the law. The RNC expenditures in question have been filed
quarterly with the FEC, the Clerk of the House of Representa-
tives and the Secretary of the United States Senate and it would
be unfair and an unconstitutional denial of due process to
apply any new standard before such time as the PFC or
RNC might be said to have been on notice that their position
was not in accordance with the FEC's view of the law. Thus,
it is impossible to conclude that such committees were ever
on such notice as would support a conclusion that there had
been a "knowing violation" of the law. Indeed, the Commission
has still not in any way ruled upon the question now before
it and any Advisory Opinion must be applied prospectively
only in this matter.
Finally, I would like to review certain additional
pragmatic considerations for the Commission's consideration.
a.
Allegations that the recognition of the role of political
FORD
parties in the maintenance and development of a viable
political structure in the United States would work an unfair
burden upon non-incumbents and allow unlimited corporate and
labor organization spending for federal candidates through
the general treasuries of state party committees are both
misleading and fallacious. As a general policy matter,
as well as pragmatic political practice, the 1974 Amendments
- 13 -
were not intended (nor should they have been) to provide a
perfect cosmic balance on which both incumbents and non-
incumbents must be evenly weighed in either. Again, as
noted in Mrs. Smith's letter, the question presented
does not revolve solely upon the President's role as
party leader but involves any incumbent federal office-
holder. The fact that such party leaders are generally
incumbent officeholders is merely a reflection of the
public's real life interest in recognized elected leaders
and public figures. Non-incumbents always perforce are
faced with the traditional obstacle and challenge of name
recognition and acceptance. The plain
fact that many incumbents have lost to earnest new challengers
even prior to the federal election campaign laws establishes
that the advantages of incumbency are not all compelling.
Further, the burdens of incumbency, including the obligation
to speak and act responsibly toward his constituency and to
represent their best interests in the harsh world of decision
as opposed to the speculation and mere promise of the non-
incumbent, are all too quickly and easily forgotten by those
who would seek to mystically equalize the political system
to their own advantage.
Similarly, the alrm sounded regarding corporate and
labor organization spending is false and a sham. The Commission
has already indicated that state parties will have to maintain
separate, segregated funds regarding any support for federal
candidates, which funds must exclude monies from corporations
and unions that
- 14 -
may be accepted by them under State law for state and local
candidates and activities. Full disclosure and exacting
reporting requirements of such funds will avoid any such anti-
cipated and feigned abuse. In addition, as in all of these
matters, the watchful eye of the press as well as opposing
candidates will expose and question any deceitful artifice
or device. Accordingly, only legitimate state party business
activities would be financed from the general treasuries
of such state parties. Section 610 of Title 18, United States
Code, would properly have no application to such legitimate state
activities.
Reliance upon Advisory Opinion Request 1975-13 and
the proposed House Account regulation is again misplaced.
That Advisory Opinion solely decided that the payment of a
Presidential Candidate's travel expenses from corporate funds
was illegal. It in no way addressed the question whether
the President may engage in political activities unrelated
to his candidacy. The distinction in the House account
proposal is self-apparent. In that situation, money is being
contributed directly to the candidate to support activities
that can have no substantive purpose other than to assist
the candidate in influencing his constituency and, of greater
- 15 -
importance, such contributions certainly do not serve to
advance a stated major purpose of the Act - the strengthening
of political parties. Moreover, in its second proposed
version of the House Account regulation it was again
recognized by the Commission that, even with regard to
such direct contributions to Congressmen, the application
of the Act's limitations would apply only to a foreshortened
period prior to an announced candidate's election.
In conclusion, we appreciate the opportunity afforded
the PFC to comment on the above-referenced Advisory Opinion
Request and we trust that these comments may prove useful
in assisting the Commission in arriving at its determination
in this matter.
Sincerely,
Robert P. Visser
General Counsel
Compaign
THE WHITE HOUSE
WASHINGTON
October 16, 1975
MEMORANDUM FOR: DON RUMSFELD
BOB HARTMANN
DICK CHENEY
JIM CONNOR
RON NESSEN
FROM:
PHIL BUCHEN T.W.B.
SUBJECT:
PFC Comments on
RNC Expenditures
Attached is a draft letter from the PFC commenting on RNC
expenditures in support of the President as head of the party.
I would appreciate any comments you might have by C.O.B.
today in order that this letter can meet tomorrow's filing
deadline.
Thank you.
BERAU R. FORD TIMBER
DRAFT - 3
RPV - 10/16/75
Office of General Counsel,
Advisory Opinion Section
The Federal Election Commission
1325 K Street, N. W.
Washington, D. C. 20463
Re: AOR 1975-72
Gentlemen:
The President Ford Committee hereby submits the following
comments in support of the position taken by the Chairman of
the Republican National Committee, Mary Louise Smith, in her
September 15 letter regarding the historical role of the Presi-
dent of the United States in his capacity as head of his
national party. It is our understanding that the Democratic
Senatorial Campaign Committee ("DSCC") has submitted comments
alleging violation of certain provisions of the Federal Election
Campaign Act of 1971, as amended, (the "Act") by both the
Republican National Committee ("RNC") and The President Ford
Committee ("PFC"). In particular, both the RNC and the princi-
pal campaign committee for the President were recklessly charged
by the DSCC with a knowing criminal violation of Section 608 (b) (2)
of Title 18, United States Code, regarding the payment by the
RNC of Presidential travel expenses solely involving Republican
Party political activities. Such assertions are without merit
and lack any substantive legal or factual basis.
- 2 -
It is our position, as demonstrated below, that such
payments by the President's national party are both proper
and lawful. Moreover, such payments recognize the three
traditional and important functions of any incumbent President.
He is President, the leader of his national party and possibly
a Presidential candidate.
First, it is clear that the limitation set forth in
Section 608 (b) (2) regarding contributions by a political
committee to a federal candidate relate solely to payments:
"
made for the purpose of influencing
the nomination for election, or election,
of any person to Federal office or for the
purpose of influencing the results of a
primary held for the selection of delegates
to a national nominating convention of a
political party or for the expression of a
preference for the nomination of persons
for election to the office of President
of the United States;
"
18 U.S.C. §591 (e) (1) (Emphasis Added)
Similarly, the definition of "expenditure" in Title 18 excludes
any payment from being charged against the candidate's primary
expenditure limitation of Ten Million Dollars ($10,000,000)
unless it is in furtherance of one of the above cited purposes.
Moreover, the definition of expenditure also explicitly
excludes "any communication by any person which is not made
for the purpose of influencing the nomination for election,
or election, of any person to Federal office". 18 U.S.C.
§591 (f) (4) (F) As set forth in greater detail in Mrs.
Smith's letter, the RNC has not and will not assume the
- 3 -
expenses of Presidential travel in connection with either
the candidacy of the President himself or with the candidacy
of any other individual. In the latter circumstances, of
course, the appropriate contribution and expenditure provisions
of the Act would apply on an allocable basis.
Second, the strength of the RNC position is underscored
by the legislative history of the Act itself. One of the
important goals of the legislative reform sought by the
1974 amendments was to strengthen the national, state and
local party structures and their impact upon the political
process while, at the same time, stemming the unchecked
flow of undisclosed private funds from being covertly
channeled into a federal candidate's coffers.
In the Senate Report on the 1974 Amendments, it was
stated in a paragraph entitled "Strengthening Political
Parties" that the Senate Committee "agrees that a vigorous
party system is vital to American politics and has given
this matter careful study." The Committee stated that
"the parties will play an increased role in building strong
coalitions of voters and in keeping candidates responsible
to the electorate through the party reorganization". Finally,
they noted
k. FORD LIBRARY
- 4 -
"[P]arties [such as the RNC] will continue to
perform crucial functions in the election apart
from fundraising, such as registration and voter
turnout campaigns, providing speakers, organizing
volunteer workers and publicizing issues. Indeed,
the combination of substantial public financing
with limits on private gifts to candidates will
release large sums presently committed to individual
campaigns and make them available for donation to
the parties, themselves. As a result, our financially
hard-pressed parties will have increased resources
not only to conduct party-wide election efforts,
but also to sustain important party operations in
between elections.
Senate Report 93-689 at 7-8 (Emphasis Added)
The traditional and one of the most effective methods by
which a national party obtains funds to support such activities
and strengthen its political base is by inviting interested
persons to fundraising events at which party leaders, and in
particular, an incumbent President, speak on issues of concern
to the Party. To date, it is my understanding that such
activities on behalf of the RNC by President Ford have raised
over $2,250,000 for his Party. The pragmatic effect of any
blanket rule denying the RNC the party services of its chief
spokesman would be to dramatically undercut and weaken that
which the Act sought to promote and strengthen.
Thus, the RNC should be permitted to pay for expenses
incurred by the President and his aides for party promotional
activity since such activities are undertaken at the singular
request of the RNC for its own purposes and benefit. In
fact, the PFC has not been involved in any efforts to initiate
- 5 -
and/or coordinate any of the President's recent trips on
behalf of the RNC. Such invitations and acceptances are
independent judgmental determinations made by the RNC
and White House in connection with party matters and for
party purposes. Moreover, such activities are totally
unrelated to the PFC campaign efforts which are directed
towards the raising of money and the scheduling of activities
for the purpose of influencing the nomination of the
President for a full term.
Third, the test for determining whether or not a contri-
bution or expense is a campaign expense related to a federal
candidate's election and therefore chargeable to the aggregate
limitations set forth in the Act, is one of intent and purpose.
Although, as Mrs. Smith noted with regard to the differing roles
of the President, such distinctions are sometimes subtle,
they are nonetheless real and subject to dispassionate analysis.
No inflexible rule should be issued by the Commission which
would obviate and eliminate partisan but non-candidate related
activities. Instead, it is our considered opinion that a
BERALD R. FORD LIBRARY
- 6 -
clear distinction exists between the activities of a President
in his official capacity, the activities of a President in his
party leader capacity and, finally, the activities of a
President as a candidate for nomination. Further, reason
dictates that any such determination by the Commission
in this regard must be made on a case by case basis.
It was recognized in the Opinion of Counsel issued
to the campaign manager of the Wyman-for-Senator Committee,
that the fact that there will always be the possibility
or even likelihood of "some carryover effect" or other
incidental benefit to the President in connection with his
appearance in New Hampshire on behalf of that candidate is
immaterial when the timing of such a visit would have no significan
demonstrable or measurable effect on the 1976 Presidential
election, nominating convention or New Hampshire primary
election. Although that opinion was restricted to a particular
set of circumstances and was not deemed necessarily applicable
to other campaign activity engaged in by a Presidential
candidate, the logical conclusion is that a similar approach
and analysis must be taken toward non-campaign activity by
a federal candidate. In fact, there are no applicable
contribution or expenditure limitations for ongoing party
business and activities which are not for the purpose of
influencing the election of a federal candidate.
The distinction between official acts by a federal
office holder and candidate related activities is reflected
- 7 -
in both the legislative history of the Act (see, e.g. H.R.
93-1279 at 150) and in the initial Task Force draft regarding
Allocation of Expenditures. Moreover, an equally real and
viable distinction exists between candidate related activities
and party related activities, particularly during the primary
period prior to the nomination at the national parties'
annual conventions.
Fourth, in order to determine whether or not partisan
political activity is directed toward party activity or an
individual's own candidacy, we would respectfully suggest
that the following approach be considered in connection with
the Commission's Advisory Opinion in this matter and as a
basis for any proposed regulation in this area. The cost of
promotional or other partisan activities on behalf of a
national, state or local party by a candidate for federal
office, whether or not a holder of public office, shall not
be attributable as a campaign expenditure by such candidate
if the activity is (1) at the sole invitation of such party,
(2) for a recognized and legitimate purpose on behalf of
the party and not for the purpose of directly raising funds
for such candidate or for the purpose of influencing his
election, provided that, notwithstanding the above, the costs
of any such activities by a candidate who has registered and
qualified as a candidate or been placed on the ballot in the
- 8 -
state in which such activity is held, shall be deemed an
expenditure from the date of registration or placement
on the ballot, in any event, at any time such activities
are undertaken in that state within forty-five (45) days
prior to the date of the respective state presidential
primary.
This approach recognizes the importance and value
of party promotional activity by federal candidates, while
at the same time providing a pragmatic time frame within
which any such activity would be deemed candidate related.
In addition, of course, any alleged party activity which
is demonstrated to be for the purpose of influencing the
candidate's own election would be appropriately allocated
and charged against the Act's contribution and expenditure
limitations. This is in accordance with the approach
recently discussed by the Commission regarding "unearmarked"
contributions to the national committee of such a candidate.
Accordingly, in the foregoing discussion we have
established that payment by the RNC of expenditures incurred
by the President and his aides, when solely engaged in national,
state or local political party promotional activities, are
not subject to the Acts contribution and spending limits.
Hence, the FEC should confirm in its Advisory Opinion that
it is legally permissible for the RNC to continue to make
such expenditures. Moreover, in any event, the Commission
should also rule that the effect of an Advisory Opinion
in this matter must be prospective only.
- 9 -
In the first place, the statutory language of Section
437 (f) of Title 2, United States Code, which authorizes the
FEC to render Advisory Opinions clearly reflects the fact
that such Advisory Opinions look only to future acts, and
not past acts. Section 437 (f) states, in pertinent part, that:
"(a) Upon written request to the
Commission
the Commission shall render
an advisory opinion, in writing, within a
reasonable time with respect to whether any
specific transaction or activity
would
constitute a violation
"
(Empahsis Added)
The words "would constitute" do not encompass acts
that occurredin the past. As the Comptroller General
has frequently ruled that the question of retroactivity is
strictly a function of the interpretation of the relevant
statute in question, the conclusion that all Advisory Opinions
must be solely prospective in application is compelling (See, e.g.
49 Comp. Gen. 505 (1970), 48 Comp. Gen. 477 (1969), 48
Comp. Gen. 15 (1968) and 47 Comp. Gen. 386 (1968))
Moreover, even if, arguendo, Advisory Opinions are
not limited to matters of prospective application only in
all matters subject to such rulings, the Commission still
has full discretion to limit its opinions to matters in the
future in appropriate cases. The United States Supreme
Court, in Chenery V. SEC, 332 U.S. 194 (1947), held that
an agency of the federal government may, in its discretion,
- 10 -
give a ruling prospective effect only. The Court stated
that the agency, in exercising this discretion, should
follow a balancing test, which involves weighing "the
mischief of producing the result which is contrary to a
statutory design or to legal and equitable principles"
against "the ill effect of the retroactive application of
a new standard
"
(332 U.S. at 203).
The foregoing test is similar to the criteria followed
by the United States Supreme Court on the question of whether
a particular judicial holding should be given retroactive
application. Recently the Court stated that the following
matters should be considered in this regard:
(a) The purpose to be served by the
new standards, (b) the extent of the reliance
by law enforcement authorities on the old
standards, and (c) the effect on the adminis-
tration of justice of a retroactive applica-
tion of the new standards" Gosa V. Mayden,
413 U.S. 655, 679 (1973), quoting, 388 U.S.
at 297.
At issue before the Commission is the appropri-
ateness of the application of the Act's contribution and
expenditure limitations set forth in 18 U.S.C. 608 to a
Presidential candidate's travel for party purposes. Title
18, of course, is a criminal statute and
h. FORD LIBRARY
- 11 -
provides for extensive criminal penalties including imprison-
ment and fines. As with all criminal statutes, a principal
feature of that section is that a violation cannot occur
unless it is a "knowing violation". In this respect, sub-
section (h) of Section 608 states as follows:
"(h) No candidate or political committee
shall knowingly accept any contribution or
make any expenditure in violation of the
provisions of this section. No officer or
employee of a political committee shall
knowingly accept a contribution made for the
the benefit or use of a candidate, or knowingly
made any expenditure on behalf of a candidate,
in violation of any limitation imposed on contri-
butions and expenditures under this section."
(Emphasis Added)
Any person found violating any perovision of this
section shall be fined not more than $25,000 or imprisoned
not more than 1 year, or both (18 U.S.C. §608(i)).
The enforcement powers of the Commission set forth in
24 U.S.C. $437g
also make it clear that the Commission
may not order repayment of any such past payments in any
event for a violation of Section 608. Appropriate apparent
violations of Section 608 are to be referred to the appropriate
law enforcement authorities. In the present instance any such
referral would be ludicrous. Accordingly, the Commission
would be committing an abuse of discretion if it should attempt
-12-
to retroactively apply any new standard against The President
Ford Committee or the RNC in this instance.
The President Ford Committee and the RNC have at all
times acted in good faith in accordance with their understanding
of the law. The RNC expenditures in question have been filed
quarterly with the FEC, the Clerk of the House of Representa-
tives and the Secretary of the United States Senate and it would
be unfair and an unconstitutional denial of due process to
apply any new standard before such time as the PFC or
RNC might be said to have been on notice that their position
was not in accordance with the FEC's view of the law. Thus,
it is impossible to conclude that such committees were ever
on such notice as would support a conclusion that there had
been a "knowing violation" of the law. Indeed, the Commission
has still not in any way ruled upon the question now before
it and any Advisory Opinion must be applied prospectively
only in this matter.
Finally, I would like to review certain additional
pragmatic considerations for the Commission's consideration.
Allegations that the recognition of the role of political
parties in the maintenance and development of a viable
political structure in the United States would work an unfair
burden upon non-incumbents and allow unlimited corporate and
labor organization spending for federal candidates through
the general treasuries of state party committees are both
misleading and fallacious. As a general policy matter,
as well as pragmatic political practice, the 1974 Amendments
- 13 -
were not intended (nor should they have been) to provide a
perfect cosmic balance on which both incumbents and non-
incumbents must be evenly weighed in either. Again, as
noted in Mrs. Smith's letter, the question presented
does not revolve solely upon the President's role as
party leader but involves any incumbent federal office-
holder. The fact that such party leaders are generally
incumbent officeholders is merely a reflection of the
public's real life interest in recognized elected leaders
and public figures. Non-incumbents always perforce are
faced with the traditional obstacle and challenge of name
recognition and acceptance. The plain
fact that many incumbents have lost to earnest new challengers
even prior to the federal election campaign laws establishes
that the advantages of incumbency are not all compelling.
Further, the burdens of incumbency, including the obligation
to speak and act responsibly toward his constituency and to
represent their best interests in the harsh world of decision
as opposed to the speculation and mere promise of the non-
incumbent, are all too quickly and easily forgotten by those
who would seek to mystically equalize the political system
to their own advantage.
Similarly, the alrm sounded regarding corporate and
labor organization spending is false and a sham. The Commission
has already indicated that state parties will have to maintain
separate, segregated funds regarding any support for federal
candidates, which funds must exclude monies from corporations
and unions that
- 14 -
may be accepted by them under State law for state and local
candidates and activities. Full disclosure and exacting
reporting requirements of such funds will avoid any such anti-
cipated and feigned abuse. In addition, as in all of these
matters, the watchful eye of the press as well as opposing
candidates will expose and question any deceitful artifice
or device. Accordingly, only legitimate state party business
activities would be financed from the general treasuries
of such state parties. Section 610 of Title 18, United States
Code, would properly have no application to such legitimate state
activities.
Reliance upon Advisory Opinion Request 1975-13 and
the proposed House Account regulation is again misplaced.
That Advisory Opinion solely decided that the payment of a
Presidential Candidate's travel expenses from corporate funds
was illegal. It in no way addressed the question whether
the President may engage in political activities unrelated
to his candidacy. The distinction in the House account
proposal is self-apparent. In that situation, money is being
contributed directly to the candidate to support activities
that can have no substantive purpose other than to assist
the candidate in influencing his constituency and, of greater
- 15 -
importance, such contributions certainly do not serve to
advance a stated major purpose of the Act - the strengthening
of political parties. Moreover, in its second proposed
version of the House Account regulation it was again
recognized by the Commission that, even with regard to
such direct contributions to Congressmen, the application
of the Act's limitations would apply only to a foreshortened
period prior to an announced candidate's election.
In conclusion, we appreciate the opportunity afforded
the PFC to comment on the above-referenced Advisory Opinion
Request and we trust that these comments may prove useful
in assisting the Commission in arriving at its determination
in this matter.
Sincerely,
Robert P. Visser
General Counsel
THE WHITE HOUSE
WASHINGTON
October 17, 1975
Mr. B,
I spoke with Barry and he indicates
that the PFC is considering whether
or not to specifically respond to
the Reagan point.
If you (Ron) are asked any questions,
you can respond that"this question
is before the FEC and the the
President stated his view of his
role as party leader at the Press
Conference on October 9, and I
don't think it is necessary to go
beyond that statement."
If you receive further questions on
the letter you can indicate that
the RNC obviously feels that the
President is the head of the
party as they are the ones who
have requested to continue such
party expenditures.
THE WHITE HOUSE
WASHINGTON
FFC
October 17, 1975
MEMORANDUM FOR:
RON NESSEN
FROM:
PHILIP BUCHEN
T.
Attached is a copy of the letter from the
Citizens for Reagan for President Committee
to the Federal Election Commission.
The President Ford Committee is preparing to
send a letter on the same subject to the FEC
today supporting the position of the RNC.
This letter meets the objections raised
earlier by the Democratic Senatorial Campaign
Committee in its letter of October 7. Whether
it will be changed before submission to
include arguments against the Reagan position,
I do not know.
Attachment
Citizens for Reagan
For President
Sen. Paul Laxalt
Chairman
John P. Sears
Exec. Vice Ch.
George Cook
October 14, 1975
H. R. Gross
Louie B. Nunn
Mrs. Stanhope C. Ring
Henry Buchanan
Treasurer
Federal Election Commission
Office of the General Counsel
Advisory Opinion Comment
1325 K Street, N.W.
Washington, D.C. 20463
Dear Sirs:
We respectfully submit the following comments on AOR-1975-72.
We hope this will be helpful to the Commission.
AOR 1975-72 raises the question of whether the Republican
National Committee (RNC) can legitimately provide funds, in light of
the recent federal election law amendments, for political travel by
President Ford while he is a candidate for his party's presidential
nomination. And further, whether these expenditures count against
candidate Ford's campaign expenditure limitations under 18 U.S. C.
section 608(c). It appears to our committee that several facts must
be considered before a conclusion on the RNC's request can be reached.
First, President Ford is an announced and declared candidate
for his party's nomination. He has, as of this date, made campaign
trips and authorized a committee which has made campaign expenditures
on behalf of his campaign. He indicated on a nationally televised news
conference (October 9, 1975) that he hoped his political trips made on
behalf of the RNC would help his election. He has made the decision
to actively campaign at an earlier date than has been the customary
political practice of past incumbent Presidents.
Federal Election Commission
October 14, 1975
Page Two
Second, Gerald R. Ford was the first individual appointed to the
Vice Presidency under the provisions of the recently enacted 25th
Amendment. Following the resignation of Richard M. Nixon as President,
Gerald R. Ford succeeded to that office. His Vice President, Nelson A.
Rockefeller, also became such by the operation of the 25th Amendment,
after having been rejected for the Republican presidential nomination
by the Republican National Conventions of 1964 and 1968. These facts
are quite important in providing some political perspective to the
relationship of the Presidency, its current occupant, and the Republican
Party.
Third, there is an active political committee in existence,
authorized by Governor Reagan, and registered with the Federal
Election Commission, that has raised significant amounts of money
from many thousands of persons in every state. This committee is
actively promoting the candidacy of Governor Ronald Reagan for the
Republican Party's presidential nomination.
Fourth, one of the basic purposes of the 1974 amendments to the
body of federal election law is to insure that no candidate, regardless
of his position or financial means, could "buy" the Presidency by means
of excessive financial expenditures. To this end, the key provision of
the 1974 Act is 18 U.S. C. section 608. This section imposes strict
expenditure limitations on all candidates for federal office. The
purpose of these limitations is, in part, to provide every candidate
with an equal opportunity to present his campaign to the electorate.
Fifth, a key criticism of the new election law is that it favors
incumbents in that it protects them against challengers. This is so,
many feel, because a challenger can only overcome the multiple
advantages of incumbency by greater campaign spending than the
incumbent. It is certainly true that an incumbent President enjoys
great political advantages by virtue of his official position, advantages
such as government-paid travel around the country to "non-political
events" and the national forum of the televised Presidential press
conference (recently exempted from equal time by the Federal
Communications Commission). Does he also, in a primary campaign
situation, enjoy the official mantle of the party and use of its funds
merely by virtue of his title ?
Federal Election Commission
October 14, 1975
Page Three
With these basic factual referents in mind we submit the following
analysis of the RNC's request:
Traditionally an incumbent President seeking reelection has been
considered unchallengable within his own political party for his party's
nomination. No incumbent President in this century has been denied
renomination by his party. In fact, so strong is the traditional role of
the incumbent President that only twice in this century has one been
defeated in a general election. In 1975 and 1976 the situation in this
country is and will be unique politically. The incumbent President and
Vice President of the Republican Party have never faced the national
electorate or, in the case of President Ford, the Republican Party
membership as expressed through its national party convention.
Thus, President Ford is clearly not in the same position as former
Republican Party presidents were. In fact, it is clear that one of the
important factors in the 1976 nomination contest is the current lack of
a nationally chosen or mandated Republican Party "leader" in the
traditional sense. The Republican Party's only elected national
spokesman is its chairman, Mrs. Mary Louise Smith.
Thus, while Gerald R. Ford is legally and constitutionally the Chie,
Executive, with all the President's powers and privileges, and entitled
to all the traditional support and respect due our Head of State, he does
not stand in the traditional role an incumbent President has had as the
titular leader of the Republican Party. Further, actions that tend not
only to place him in such a role but also to emphasize it directly
benefit his campaign for the party's nomination for President. In
fact, a key selling point of the President's campaign has been his
incumbency. To argue that his campaign for the nomination should not
be hindered because of his activities as "party leader, " is very
like the boy, who having killed his parents, says he should not be
punished because he is an orphan.
Only the 1976 nominee of the Republican National Convention will
be the party's chosen leader.
The 1974 amendments to federal election law mandate strict
expenditure limitations for all federal candidacies. They do this
separately with respect to candidates for the nomination of parties and
Federal Election Commission
October 14, 1975
Page Four
for the candidates of parties in general elections. Further, the law
embodies a very expansive and comprehensive definition of contributions
and expenditures so as to close nearly every potential loophole left in
past legislative attempts at regulation. This legislative plan clearly
manifests the intent of Congress, as ratified by President Ford in
signing the law, to establish a system of electoral regulation that would
control, limit and disclose all expenditures that promote and influence a
federal campaign. It cannot be seriously argued that political trips made
by a declared candidate, as "leader" of a political party, directed at
those very individuals who will ultimately choose the party's nominee,
does not directly benefit and influence and promote such candidate's
campaign. If President Ford's eampaign is not charged with the
cost of trips made as the "leader" of the Republican Party under these
circumstances then section 608 is not the comprehensive expenditure
limitation section it clearly was intended to be.
If the Commission's interpretation of this new law is not to favor
incumbents over other candidates and if the traditional relationship
of the Presidency to its own political party is not to become a vehicle
for allowing the new election law to be gravely distorted then the RNC's
planned actions must be modified. It would certainly be divisive within
the Republican Party if the RNC were to bestow a non-reportable and
uncontrolled election benefit on only one candidate for the party's
nomination. This would raise constitutional questions of whether 18
U.S.C. section 603's effect, if not its purpose, is to stifle legitimate
political challenges to incumbents from within their own parties.
If the party provided truly equal treatment to all candidates for
its nomination then few serious objections could be raised. Then, the
party would not be promoting a campaign but would be providing its
national membership with a better opportunity for seeing all its candidates.
It would be performing a legitimate informational function by helping
members to make more intelligent choices among the candidates.
While a TV appearance by one candidate benefits his campaign, a program
presenting all of the candidates equally benefits the electorate. Of
course, a fair and equitable mechanism would have to be worked out
to determine who the individuals are who are legitimately entitled to
such consideration. But this should not be difficult. A simple criterion,
like qualification for federal matching funds, would provide an adequate
method for discriminating between bona fide candidates and others.
Federal Election Commission
October 14, 1975
Page Five
If the RNC chooses not to consider such an option it seems to our
committee that its current proposal raises serious questions under both
the contribution limitations and the expenditure limitations of section 60S.
If party "leadership" is to confer substantial financial electoral benefits
it should be both formalized and brought within the guidelines of the
election law. Governor Reagan has over the past years raised millions
of dollars for the Republican Party at numerous party events across the
nation and by direct mail. He has done this as a member of the party
who deeply believes in its principles. Our committee feels that the party
treasury, built up in the interests of the whole party, should not become
a vehicle for any single candidate in contest for the party's nomination,
regardless of any office he may hold.
In 1975 and 1976 a new federal election law prevails. Examples
of past practice no longer suffice to justify present actions. We hope
our comments will aid the Federal Election Commission in deciding
this question.
Very truly yours,
Leen a Smith
Loren A. Smith
General Counsel
LAS:jf
cc: Hon. Thomas B. Curtis
Hon. Neil Staebler
Hon. Joan Aikens
Hon. Thomas E. Harris
Hon. Vernon W. Thomson
Hon. Robert O. Tiernan
Hon. Benton L. Becker
Hon. Mary Louise Smith
THE WHITE HOUSE
WASHINGTON
October 17, 1975
MEMORANDUM FOR:
RON NESSEN
FROM:
PHILIP BUCHEN
T.
Attached is a copy of the letter from the
Citizens for Reagan for President Committee
to the Federal Election Commission.
The President Ford Committee is preparing to
send a letter on the same subject to the FEC
today supporting the position of the RNC.
This letter meets the objections raised
earlier by the Democratic Senatorial Campaign
Committee in its letter of October 7. Whether
it will be changed before submission to
include arguments against the Reagan position,
I do not know.
Attachment
FORD & LIBRARY $378.38
Citizens for Reagan
For President
Sen. Paul Laxalt
Chairman
John P. Sears
Exec. Vice Ch.
George Cook
October 14, 1975
H.R. Gross
Louie B. Nunn
Mrs. Stanhope C. Ring
Henry Buchanan
Treasurer
Federal Election Commission
Office of the General Counsel
Advisory Opinion Comment
1325 K Street, N. W.
Washington, D. C. 20463
Dear Sirs:
We respectfully submit the following comments on AOR-1975-72.
We hope this will be helpful to the Commission.
AOR 1975-72 raises the question of whether the Republican
National Committee (RNC) can legitimately provide funds, in light of
the recent federal election law amendments, for political travel by
President Ford while he is a candidate for his party's presidential
nomination. And further, whether these expenditures count against
candidate Ford's campaign expenditure limitations under 18 U.S. C.
section 608(c). It appears to our committee that several facts must
be considered before a conclusion on the RNC's request can be reached.
First, President Ford is an announced and declared candidate
for his party's nomination. He has, as of this date, made campaign
trips and authorized a committee which has made campaign expenditures
on behalf of his campaign. He indicated on a nationally televised news
conference (October 9, 1975) that he hoped his political trips made on
behalf of the RNC would help his election. He has made the decision
to actively campaign at an earlier date than has been the customary
political practice of past incumbent Presidents.
LIBRARY BERALD ? TORO
Federal Election Commission
October 14, 1975
Page Two
Second, Gerald R. Ford was the first individual appointed to the
Vice Presidency under the provisions of the recently enacted 25th
Amendment. Following the resignation of Richard M. Nixon as President,
Gerald R. Ford succeeded to that office. His Vice President, Nelson A.
Rockefeller, also became such by the operation of the 25th Amendment,
after having been rejected for the Republican presidential nomination
by the Republican National Conventions of 1964 and 1968. These facts
are quite important in providing some political perspective to the
relationship of the Presidency, its current occupant, and the Republican
Party.
Third, there is an active political committee in existence,
authorized by Governor Reagan, and registered with the Federal
Election Commission, that has raised significant amounts of money
from many thousands of persons in every state. This committee is
actively promoting the candidacy of Governor Ronald Reagan for the
Republican Party's presidential nomination.
Fourth, one of the basic purposes of the 1974 amendments to the
body of federal election law is to insure that no candidate, regardless
of his position or financial means, could "buy" the Presidency by means
of excessive financial expenditures. To this end, the key provision of
the 1974 Act is 18 U.S.C. section 608. This section imposes strict
expenditure limitations on all candidates for federal office. The
purpose of these limitations is, in part, to provide every candidate
with an equal opportunity to present his campaign to the electorate.
Fifth, a key criticism of the new election law is that it favors
incumbents in that it protects them against challengers. This is so,
many feel, because a challenger can only overcome the multiple
advantages of incumbency by greater campaign spending than the
incumbent. It is certainly true that an incumbent President enjoys
great political advantages by virtue of his official position, advantages
such as government-paid travel around the country to "non-political
events" and the national forum of the televised Presidential press
conference (recently exempted from equal time by the Federal
Communications Commission). Does he also, in a primary campaign
situation, enjoy the official mantle of the party and use of its funds
merely by virtue of his title ?
FORD
ANVUNIT
Federal Election Commission
October 14, 1975
Page Three
With these basic factual referents in mind we submit the following
analysis of the RNC's request:
Traditionally an incumbent President seeking reelection has been
considered unchallengable within his own political party for his party's
nomination. No incumbent President in this century has been denied
renomination by his party. In fact, so strong is the traditional role of
the incumbent President that only twice in this century has one been
defeated in a general election. In 1975 and 1976 the situation in this
country is and will be unique politically. The incumbent President and
Vice President of the Republican Party have never faced the national
electorate or, in the case of President Ford, the Republican Party
membership as expressed through its national party convention.
Thus, President Ford is clearly not in the same position as former
Republican Party presidents were. In fact, it is clear that one of the
important factors in the 1976 nomination contest is the current lack of
a nationally chosen or mandated Republican Party "leader" in the
traditional sense. The Republican Party's only elected national
spokesman is its chairman, Mrs. Mary Louise Smith.
Thus, while Gerald R. Ford is legally and constitutionally the Chie,
Executive, with all the President's powers and privileges, and entitled
to all the traditional support and respect due our Head of State, he does
not stand in the traditional role an incumbent President has had as the
titular leader of the Republican Party. Further, actions that tend not
only to place him in such a role but also to emphasize it directly
benefit his campaign for the party's nomination for President. In
fact, a key selling point of the President's campaign has been his
incumbency. To argue that his campaign for the nomination should not
be hindered because of his activities as "party leader, " is very
like the boy, who having killed his parents, says he should not be
C
punished because he is an orphan.
Only the 1976 nominee of the Republican National Convention will
be the party's chosen leader.
SERALE FORD UNITED
The 1974 amendments to federal election law mandate strict
expenditure limitations for all federal candidacies. They do this
separately with respect to candidates for the nomination of parties and
Federal Election Commission
October 14, 1975
Page Four
for the candidates of parties in general elections. Further, the law
embodies a very expansive and comprehensive definition of contributions
and expenditures so as to close nearly every potential loophole left in
past legislative attempts at regulation. This legislative plan clearly
manifests the intent of Congress, as ratified by President Ford in
signing the law, to establish a system of electoral regulation that would
control, limit and disclose all expenditures that promote and influence a
federal campaign. It cannot be seriously argued that political trips made
by a declared candidate, as "leader" of a political party, directed at
those very individuals who will ultimately choose the party's nominee,
does not directly benefit and influence and promote such candidate's
campaign. If President Ford's campaign is not charged with the
cost of trips made as the "leader" of the Republican Party under these
circumstances then section 608 is not the comprehensive expenditure
limitation section it clearly was intended to be.
If the Commission's interpretation of this new law is not to favor
incumbents over other candidates and if the traditional relationship
of the Presidency to its own political party is not to become a vehicle
for allowing the new election law to be gravely distorted then the RNC's
planned actions must be modified. It would certainly be divisive within
the Republican Party if the RNC were to bestow a non-reportable and
uncontrolled election benefit on only one candidate for the party's
nomination. This would raise constitutional questions of whether 18
U.S.C. section 608's effect, if not its purpose, is to stifle legitimate
political challenges to incumbents from within their own parties.
If the party provided truly equal treatment to all candidates for
its nomination then few serious objections could be raised. Then, the
party would not be promoting a campaign but would be providing its
national membership with a better opportunity for seeing all its candidates.
It would be performing a legitimate informational function by helping
members to make more intelligent choices among the candidates.
While a TV appearance by one candidate benefits his campaign, a program
presenting all of the candidates equally benefits the electorate. Of
course, a fair and equitable mechanism would have to be worked out
to determine who the individuals are who are legitimately entitled to
such consideration. But this should not be difficult. A simple criterion,
like qualification for federal matching funds, would provide an adequate
method for discriminating between bona fide candidates and others.
Year
Federal Election Commission
October 14, 1975
Page Five
If the RNC chooses not to consider such an option it seems to our
committee that its current proposal raises serious questions under both
the contribution limitations and the expenditure limitations of section 608.
If party "leadership" is to confer substantial financial electoral benefits
it should be both formalized and brought within the guidelines of the
election law. Governor Reagan has over the past years raised millions
of dollars for the Republican Party at numerous party events across the
nation and by direct mail. He has done this as a member of the party
who deeply believes in its principles. Our committee feels that the party
treasury, built up in the interests of the whole party, should not become
a vehicle for any single candidate in contest for the party's nomination,
regardless of any office he may hold.
In 1975 and 1976 a new federal election law prevails. Examples
of past practice no longer suffice to justify present actions. We hope
our comments will aid the Federal Election Commission in deciding
this question.
Very truly yours,
Leen a Smith
Loren A. Smith
General Counsel
LAS:jf
cc: Hon. Thomas B. Curtis
Hon. Neil Staebler
Hon. Joan Aikens
Hon. Thomas E. Harris
Hon. Vernon W. Thomson
Hon. Robert O. Tiernan
Hon. Benton L. Becker
BERALE FORD UNITED
Hon. Mary Louise Smith
President
Committee
1828 L STREET, N W., SUITE 250, WASHINGTON D.C. 20036 (202) 457-6400
October 17, 1975
Office of General Counsel,
Advisory Opinion Section
The Federal Election Commission
1325 K Street, N. W.
Washington, D. C. 20463
Re: AOR 1975-72
Gentlemen:
The President Ford Committee hereby submits the
following comments in support of the position taken by
the Chairman of the Republican National Committee, Mary
Louise Smith, in her September 15 letter regarding the
historical role of the President of the United States
in his capacity as head of his national party.
We have had the opportunity to review the comments
of the Democratic Senatorial Campaign Committee ("DSCC")
alleging violation of certain provisions of the Federal
Election Campaign Act of 1971, as amended, (the "Act") by
both the Republican National Committee ("RNC") and the
principal campaign committee for the President, The Presi-
dent Ford Committee ("PFC"). In particular, both the RNC
and the PFC were recklessly charged by the DSCC with a
knowing criminal violation of Section 608 (b) (2) of Title
18, United States Code, regarding the payment by the RNC
of Presidential travel expenses solely involving Republican
Party political activities. Such assertions are without
merit and lack any substantive legal or factual basis.
It is our position, as demonstrated below, that such
payments by the President's national party are both proper
and lawful. Moreover, such payments recognize three tradi-
tional and important functions of any incumbent President.
He is President, the leader of his national party and at
times a Presidential candidate.
BESALD LIBRATY TORO
The President Ford Committee, Howard H. Callaway. Chairman, David Packard. National Finance Chairman, Robert C. Moot. Treasurer. A CODY of
Office of General Counsel,
Page 2
Advisory Opinion Section
October 17, 1975
First, it is clear that the limitation set forth in
Section 608 (b) (2) regarding contributions by a political
committee to a federal candidate relate solely to payments:
"
made for the purpose of influencing
the nomination for election, or election,
of any person to Federal office or for the
purpose of influencing the results of a
primary held for the selection of delegates
to a national nominating convention of a
political party or for the expression of a
preference for the nomination of persons
for election to the office of President of
the United States
"
18 U.S.C. §591 (e) (1) (emphasis added)
Similarly, the definition of "expenditure" in Title 18 excludes
any payment from being charged against the candidate's primary
expenditure limitation of Ten Million Dollars ($10,000,000)
unless it is in furtherance of one of the above-cited purposes.
Moreover, the definition of expenditure also explicitly excludes
"
any communication by any person which is not made for
the purpose of influencing the nomination for election, or
election, of any person to Federal office". 18 U.S.C. §591
(f) (4) (F). As set forth in greater detail in Mrs. Smith's
letter, the RNC has not and will not assume the expenses of
Presidential travel in connection with either the candidacy
of the President himself or with the candidacy of any other
individual. In the latter circumstances, of course, the
appropriate contribution and expenditure provisions of the
Act would apply on an allocable basis.
Second, the strength of the RNC position is underscored
by the legislative history of the Act itself. One of the
important goals of the legislative reform sought by the 1974
Amendments was to strengthen the national, state and local
party structures and their impact upon the political process
while, at the same time, stemming the flow of undisclosed
private funds which may be covertly channeled into a federal
candidate's coffers. In a paragraph entitled "Strengthening
Office of General Counsel,
Page 3
Advisory Opinion Section
October 17, 1975
Political Parties", the Senate Report on the 1974 Amendments
states that the Senate Committee "agrees that a vigorous
party system is vital to American politics and has given
this matter careful study". Further, the Committee stated
that "the parties will play an increased role in building
strong coalitions of voters and in keeping candidates
responsible to the electorate through the party reorganiza-
tion". Finally, they noted:
[P] arties [such as the RNC] will
continue to perform crucial functions in
the election apart from fundraising, such
as registration and voter turnout campaigns,
providing speakers, organizing volunteer
workers and publicizing issues. Indeed,
the combination of substantial public
financing with limits on private gifts to
candidates will release large sums presently
committed to individual campaigns and make
them available for donation to the parties,
themselves. As a result, our financially
hard-pressed parties will have increased
resources not only to conduct party-wide
election efforts, but also to sustain import-
ant party operations in between elections.
S. Rep. No. 689, 93d Cong., 2d Sess. 8 (1974)
(emphasis added)
The traditional and one of the most effective methods by which
a national party obtains funds to support such activities and
strengthen its political base is by inviting interested persons
to fundraising events at which party leaders, and in particular,
an incumbent President, speak on issues of concern to the Party.
In this regard, as evidenced by Mrs. Smith's Advisory Opinion
Request, the RNC has selected President Ford as not only its
principal spokesman but also the leader of the Republican Party.
To date, it is our understanding that such activities by
President Ford have raised over $2,250,000 in 1975 for his
Party. The pragmatic effect of any blanket rule denying the
BERAID FORD LIBRARY
Office of General Counsel,
Page 4
Advisory Opinion Section
October 17, 1975
RNC the party services of its chief spokesman would be to
dramatically undercut and weaken that which the Act sought
to promote and strengthen.
Thus, the RNC should be permitted to pay for expenses
incurred by the President and his aides for party promotional
activity since such activities are undertaken at the singular
request of the RNC for its own purposes and benefit. In fact,
the PFC has not initiated, participated in, and/or coordinated
any of the President's trips on behalf of the RNC. Such
invitations and acceptances are independent determinations
made by the RNC and the White House in connection with party
matters and for party purposes. Moreover, such activities
are totally unrelated to the PFC campaign efforts which are
directed towards the raising of money and the scheduling of
activities for the purpose of influencing the nomination of
the President for a full term.
Third, the test for determining whether or not a contri-
bution or expense is a campaign expense related to a federal
candidate's election, and therefore chargeable to the aggre-
gate limitations set forth in the Act, is one of intent and
purpose. Although, as Mrs. Smith noted with regard to the
differing roles of the President, such distinctions are some-
times subtle, they are nonetheless real and subject to dispas-
sionate analysis. No inflexible rule should be issued by the
Commission which would obviate and eliminate partisan but
non-candidate related activities. Instead, it is our consid-
ered opinion that a clear distinction exists between the
activities of a President in his official capacity, the activ-
ities of a President in his party leader capacity and,
finally, the activities of a President as a candidate for
nomination. Reason dictates that any such determination by
the Commission in this regard must be rendered on a case by
case basis.
Further, in the Opinion of Counsel issued to the
campaign manager of the Wyman-for-Senator Committee the
Commission recognized the relative immateriality of the
"carryover effect" or other incidental benefit to the Presi-
dent in connection with his appearance in New Hampshire on
TORD LIBRARY
Office of General Counsel,
Page 5
Advisory Opinion Section
October 17, 1975
behalf of Wyman, particularly when the timing of such a
visit had no significant demonstrable or measurable effect
on the 1976 Presidential election, nominating convention or
New Hampshire primary election. Although that opinion was
restricted to a particular set of circumstances and was
not deemed necessarily applicable to other "campaign"
activity engaged in by a Presidential candidate, the logical
conclusion is that a similar approach and analysis must
be taken toward non-campaign activity by a federal candidate.
The distinction between official acts by a federal
officeholder and candidate related activities is also
reflected in both the legislative history of the Act (see,
H. R. Rep. No. 1239, 93d Cong., 2d Sess. 150 (1974) and
in the Commission's initial Task Force draft regarding
Allocation of Expenditures. Moreover, an equally real and
viable distinction exists between candidate related activities
and party related activities, particularly during the primary
period prior to the nomination at the national parties' annual
conventions.
Fourth, it has also been suggested that the Commission
should rely upon Advisory Opinion 1975-13 and the proposed
House Account regulations. Such reliance is, in our opinion,
misplaced. That Advisory Opinion merely decided that the
payment of a Presidential Candidate's travel expenses from
corporate funds was illegal. It in no way addressed the
question whether the President may engage in political activ-
ities unrelated to his candidacy. The distinction in the
House Account proposal is self-apparent. In that situation,
money is being contributed directly to the candidate to sup-
port activities that can have no substantive purpose other
than to assist the candidate in influencing his constituency
and, of greater importance, such contributions certainly do
not serve to advance a stated major purpose of the Act - the
strengthening of political parties. Moreover, in its second
proposed version of the House Account regulation it was again
recognized by the Commission that, even with regard to such
direct contributions to Congressmen, the application of the
Act's limitations would apply only to a foreshortened period
prior to an announced candidate's election.
THE
LIBRARY
Office of General Counsel,
Page 6
Advisory Opinion Section
October 17, 197
Fifth, it is possible to develop objective criteria
for determining whether or not partisan political activity
is directed toward party activity or an individual's own
candidacy. One such approach that may be considered in
connection with the Commission's Advisory Opinion in this
matter and as a basis for any proposed regulation in this
area is as follows:
The cost of promotional or other
partisan activites on behalf of a national,
state or local party by a candidate for
federal office, whether or not a holder of
federal office, shall not be attributable
as a campaign expenditure by such candidate
if the activity is (1) at the invitation of
such party, (2) for a recognized and legit-
imate purpose on behalf of the party and not
for the purpose of directly raising funds
for such candidate or for the purpose of
influencing his election, provided that,
notwithstanding the above, the costs of any
such activities by a candidate who has
registered and qualified as a candidate or
has been placed on the ballot in the
state in which such activity is held, shall
be deemed an expenditure from the date of
registration, qualification or placement
on the ballot, or, in any event, at any
time such activities are undertaken in that
state within thirty (30) days prior to the
date of an election regarding such candidate
as defined in 2 U.S.C. 431(a).
This approach recognizes the importance and value of
party promotional activity by federal candidates who are also
recognized party leaders, while at the same time providing a
pragmatic time frame within which any such activity would be
deemed candidate related. In addition, of course, any alleged
party activity which is demonstrated to be for the purpose of
FORD
Office of General Counsel,
Page 7
Advisory Opinion Section
October 17, 1975
influencing the candidate's own election would be appropriately
allocated and charged against the Act's contribution and ex-
penditure limitations. This is in accordance with the approach
recently discussed by the Commission regarding "unearmarked"
contributions to the national committee of such a candidate.
Accordingly, we have herein established that payment
by the RNC of expenditures incurred by the President and his
aides, when solely engaged in national, state or local
political party promotional activities, are not subject at
this time to the Act's contribution and expenditure limita-
tions. Hence, the Commission should confirm in its Advisory
Opinion that it is legally permissible for the RNC to continue
to make such expenditures. In any event, the Commission's
opinion in this matter can have only a prospective effect.
Supporting this proposition, the statutory language
of Section 437f which authorizes the Commission to render
Advisory Opinions, clearly states that Advisory Opinions look
only to future and not past acts:
"Upon written request to the Commis-
sion
the Commission shall render an
advisory opinion, in writing, within a
reasonable time with respect to whether
any specific transaction or activity
would constitute a violation
"
2 U.S.C. $437f(a) (emphasis added)
The words "would constitute" do not emcompass acts that
occured in the past. As the Comptroller General of the
United States has frequently ruled, the question of retro-
activity is strictly a function of the interpretation of the
relevant statute in question. (See, e.g. 49 Comp. Gen. 505
(1970), 48 Comp. Gen. 477 (1969), 48 Comp. Gen. 15 (1968) and
47 Comp. Gen. 386 (1968) ) Accordingly, the conclusion that
all Advisory Opinions must be solely prospective in appli-
cation is compelling.
FORD
ANVUSIT
Office of General Counsel,
Page 8
Advisory Opinion Section
October 17, 1975
Moreover, assuming, arguendo, that Advisory Opinions
are not statutorily limited to matters of prospective appli-
cation, the Commission still has full discretion to limit
its opinions to matters in the future. The United States
Supreme Court, in Chenery V. SEC, 332 U.S. 194 (1947), held
that an agency of the federal government may, in its discre-
tion, give a ruling prospective effect only. The Court
stated that the agency, in exercising this discretion, should
follow a balancing test, which involves weighing "
the
mischief of producing the result which is contrary to a
statutory design or to legal and equitable principles"
against "the ill effect of the retroactive application of
a new standard
"
332 U.S. at 203.
At issue here is the application of the Act's contri-
bution and expenditure limitations set forth in 18 U.S.C. 608
to a Presidential candidate's travel for party purposes.
Title 18, of course, is a criminal statute and provides for
extensive criminal penalties including imprisonment and fines.
As with all criminal statutes, a principal feature of that
section is that a violation cannot occur unless it is a
"knowing violation". In this respect, subsection (h) of
Section 608 states as follows:
"No candidate or political committee
shall knowingly accept any contribution or
make any expenditure in violation of the
provisions of this section. No officer or
employee of a political committee shall
knowingly accept a contribution made for
the benefit or use of a candidate, or
knowingly make any expenditure on behalf of
a candidate, in violation of any limitation
imposed on contributions and expenditures
under this section.'
18 U.S.C. $608 (h) (emphasis added)
Thus, it is impossible to conclude that the RNC or PFC were
ever on notice that there may have been a "knowing violation"
of the law. Indeed, the Commission has still not in any way
ruled upon the question now before it and any Advisory Opinion
must be applied prospectively.
Ford
LIBRARY
Office of General Counsel,
Page 9
Advisory Opinion Section
October 17, 1975
The enforcement powers of the Commission set forth in
2 U.S.C. $437g, establish that the Commission may not order
repayment of any such past payments in any event for a viola-
tion of Section 608. Apparent violations of Section 608 are
to be referred to the appropriate law enforcement authorities.
The Commission would be committing an abuse of discretion if
it should attempt to retroactively apply any new standard
against the PFC or the RNC in this instance.
Additionally, the PFC and the RNC have at all times
acted in good faith and in accordance with their understanding
of the law. The RNC expenditures in question have been filed
quarterly with the Commission, the Clerk of the House of
Representatives and the Secretary of the United States Senate.
It would, therefore, be unfair and an unconstitutional denial
of due process to apply a new legal standard or presumption
before the PFC or RNC have been on notice that their position
is not in accordance with the Commission's view of the law.
Finally, a review of certain additional pragmatic
considerations appears appropriate for the Commission's con-
sideration. Allegations that the recognition of the role of
political parties in the maintenance and development of a
viable political structure in the United States would (a)
work an unfair burden upon non-incumbents and (b) allow
unlimited corporate and labor organization spending for
federal candidates, through the general treasuries of state
party committees are both misleading and fallacious. As
a general policy matter, as well as pragmatic political
practice, the 1974 Amendments were not intended (nor should
they have been) to provide a perfect cosmic balance on
which both incumbents and non-incumbents must be evenly
weighed. Again, as noted in Mrs. Smith's letter, the ques-
tion presented does not revolve solely upon the President's
role as the RNC's chosen party leader but involves any party
leader. The fact that such party leaders are generally
incumbent officeholders is merely a reflection of the
public's real life interest in recognized elected leaders
FORD
LIBRANT
Office of General Counsel,
Page 10
Advisory Opinion Section
October 17, 1975
and public figures. Non-incumbents are necessarily faced
with the traditional obstacle and challenge of name recog-
nition and acceptance. Further, the burdens of incumbency
are all too quickly and easily forgotten by those who would
seek to mystically equalize the political system to their
own advantage. An incumbent has the obligation to speak
and act responsibly toward his constituency and to repre-
sent their best interests in the harsh world of decision
as opposed to the speculation and mere promise of the non-
incumbent.
Similarly, the alarm sounded regarding corporate and
labor organization spending is false and a sham. The Commis-
sion has already indicated that state parties will have to
maintain separate, segregated funds regarding any support
for federal candidates, which funds must exclude monies
from corporations and labor organizations that may be
accepted by them under state law for state and local candi-
dates and activities. Full disclosure and exacting reporting
requirements of such funds will avoid any such anticipated
and feigned abuse. Accordingly, only legitimate state party
business activities would be financed from the general
treasuries of such state parties. Section 610 of Title 18,
United States Code, would properly have no application to
such legitimate state activities.
In conclusion, we appreciate the opportunity afforded
the PFC to comment on the above-referenced Advisory Opinion
Request and we trust that these comments may prove useful
in assisting the Commission in arriving at its determination
in this matter.
Sincerely,
THE PRESIDENT FORD COMMITTEE
Robert Visser
Robert P. Visser, General Counsel
FORD LIBRARY
Ryan
T. Timothy Ryan, Assistant
General Counsel
Friday 11/7/75
11:45 John Hart of NBC would like to talk with you about
686-4283
your September 3rd letter to the Federal Election
Committee -- copy attached.
Done
1. FORD JIBRARY
THE WHITE HOUSE
chron
WASHINGTON
September 3, 1975
Dear Mr. Curtis:
This is in response to Notice 1975-38 (F.R. 40202) in which
the Federal Election Commission has sought comments concern-
ing a request from the campaign manager for Mr. Louis Wyman
for an opinion of the FEC General Counsel on several questions
relating to possible travel by "President Ford and former
Governor Reagan" to New Hampshire for the purpose of endorsing
Mr. Wyman in the September 16, 1975, special Senatorial election.
The General Counsel has proposed for Commission review an
opinion responding to this request which states, in part, as follows:
"Presidential expenditures in connection
with such a visit provide unique problems of
attribution. It would be illogical, and un-
necessarily restrictive, to require the attribution
of the actual cost of a presidential campaign
foray. Hence, only the equivalent commercial
rates will be chargeable against an incumbent
President's individual contribution limitations
and against the candidate's overall expenditure
limitation. Expenses for accompanying staff
personnel will be charged against the foregoing
limitations only if such staff personnel serve
primarily as advance persons or other campaign
staff members and do not provide support services
to the Office of the President. Additionally, special
costs attendant upon Ford's office as President,
such as the Secret Service, police and medical
attention, are not to be included within this
amount. These costs are relatively fixed and
are related to Ford's position as President and
not to his political function as head of his
party."
NEDALE n. FORD LIBRARY
In the form of comment on this one provision, we wish to bring
to your attention the manner in whi ch we intend to apportion
the various costs incurred to operate government-owned aircraft
on which the President and accompanying government personnel
travel to and from localities where the President appears for
other than official purposes. As the General Counsel's proposed
opinion indicates, expenditures for such travel by the President
present problems that are unique to his Federal office, in that
the President must continue to perform in his official capacity
at the same time he undertakes political activities.
For this reason, whenever the President travels, regardless of
the purpose of the particular trip, he is accompanied by a number
of persons who are present to support him in his official role.
For example, certain members of the White House staff, military
aides, medical aides, Secret Service and communications personnel
are present not for any political purpose, but solely to provide the
President with support which in many cases they are required by
law to perform. The Secret Service, in particular, is required
by P.L. 90-331 to provide protection to "major Presidential and
Vice Presidential" candidates at the direction of the Secretary of
the Treasury and on the basis of consultation with an advisory
committee of bipartisan congressional membership.
(1) Costs of Operating Government-Owned Aircraft
on Political Trips
When the President travels on a trip which entails
only political stops, the cost of operating the Government-owned
aircraft that are used to transport the President can be readily
determined from the enclosed hourly rate schedule, used by the
Department of Defense to recover its costs from other government
agencies that use military aircraft. In our view, the costs of
transporting any persons aboard the aircraft who are traveling for
political purposes should be borne by the appropriate political
committee. On the other hand, the costs of transporting those
persons who are traveling for the purpose of supporting the Office
of the President should not be attributed to a political committee.
For the purpose of the President's future travels, we will identify
those individuals who could be considered to be present for a
-3-
political purpose. We plan to treat as political travelers the
President and First Family, political committee officials, certain
White House and other officials, who may perform some political
activities, and any other persons whose activities could be viewed
as political. Although White House officials are present for official
support activities, and generally spend a substantial majority, if
not all, of their time on official business, we intend to consider
the following categories of officials to be political for the purpose
of such travel: White House officials who may advise on political
matters (e.g., Donald Rumsfeld, Robert Hartmann, John Marsh,
Ron Nessen, Richard Cheney, etc.), speechwriters, advancemen,
and a White House photographer.
The remainder of the White House personnel is present for the
purpose of supporting the President in his official capacity, e.g.,
a civilian aide or personal secretary, along with non-White House
support personnel, e.g., the Secret Service, military aides,
medical and communications personnel, etc. They are not
present for any political purpose, and the costs of their travel
should not be attributed to a political committee. In this regard,
it is our understanding that in 1972 the Secret Service paid up to
the cost of comparable first-class airfare for its agents traveling
on board chartered aircraft of non-incumbent Presidential candidates.
Therefore, on future Presidential travel the appropriate political
committee will be charged by DOD for its pro rata share of the
hourly costs of using government-owned aircraft, based on the
percentage of the passengers on board who, are present mainly
or in part for a political purpose.
(2) Costs of Operating Government-Owned Aircraft
on Mixed Official-Political Trips
In most cases, it is not possible to schedule the
President's travel in a manner that will allow trips to be solely
official or solely political. We believe that the best formula for
apportioning the transportation costs on mixed official-political
purpose trips is one which may be referred to as the "round trip
airfare formula. " Under this formula, the political stops are
-4-
isolated from the official stops in order to establish the political
trip that would have been made if the President did not have the
responsibilities of his office. For this purpose, where a particular
stop includes both official and political events, it will be treated as
a political stop. A stop will be regarded as official when that is
its main purpose, even though the President may meet, incidental
to the official event, with political figures in an informal and
unpublicized meeting, e.g., a private breakfast with a local
political figure or greeting a small group of local politicians.
Once the political stops of such a trip have been determined, DOD
calculates the cost of that "political" trip and charges the appro-
priate political committee for its share, as described above, of
the costs of the trip, based on the round trip flying time between
the initial point of departure, generally, Washington, D. C., and
the political stops made. An example might help to clarify this
approach. Suppose the President makes a trip from Washington
to San Francisco for official purposes, then to Los Angeles for
political purposes, and returns to Washington via St. Louis where
a stop is made for official purposes. Under this formula, the
appropriate political committee is charged for its pro rata share
of the hourly costs of a trip from Washington to Los Angeles and
return to Washington, even though there was no direct Washington
to Los Angeles leg of the flight.
(3) Other Travel Costs
In order to assure that all costs related to the political
portion of a trip are treated as political costs, the appropriate
political committee will be charged the expenses for each political
stop of any member of the Presidential party who is present
mainly or in part for a political purpose, as determined above.
Thus, political funds will pay the expenses of the President and
these other officials, but not the expenses of those persons who
are present to support the President entirely in his official capacity.
Such items as communications arrangements, motorcades,
automobile rentals, and other miscellaneous items are readily
identifiable as to their purpose, and are to be paid by the appro-
priate political committee when they are for political purposes.
-5-
Where an item, such as the cost of a bus for a motorcade involves
a mixed purpose, e.g., transporting the members of the Presidential
party who are considered to be present for a political purpose, and
also those serving the President in his official capacity, the appro-
priate political committee will bear the full cost of that item.
In every case where a candidate for Federal office is an incumbent,
either in an office to which he seeks re-election or in another
office, his campaign activities may become intermingled with
his offici activities, and similar problems will arise in ascertain-
ing which costs he incurs are campaign-related. The proposals
herein made provide a reasonable method for resolving such
problems.
(4) Services of Government Personnel
For the purpose of identifying the costs of travel to be
borne by the appropriate political committee, we understand that
it is not necessary to apportion the salaries of those members of
the personal staffs of incumbent candidates for Federal office
within either the Executive or Legislative Branches who, in
addition to their official duties, also participate in some limited
political activities. For example, employees "paid from the
appropriation for the office of the President "are exempted by
5 U.S.C. 7324(d)(1) from the general prohibition contained in
5 U.S.C. 7324(a)(2) against Executive Branch employees participat-
ing in "political management or in political campaigns. " This
section effectively places the White House staff in a position
comparable to that of the personal staffs of members of Congress.
No precise dividing line now exists, nor is one likely to be drawn,
which clearly indicates when such employees are performing
official duties and when those duties are political. So long as
these employees expend a substantial majority (an average in excess of
forty hours per week) of their time on official duties, there is
no need to attribute any portion of the salaries of such employees
to a political committee.
The reason for this letter is to bring to the Commission's attention
the means by which we intend to attribute to a political committee
the costs of the President's travel for purposes of support of the
-6-
Republican Party, support of specific candidates, or support of
his own candidacy. To the extent this treatment may be different
from that proposed by the General Counsel, we do not imply that
a change need be made in the proposed opinion of such counsel.
Rather we believe that the proposed opinion is consistent with the
requirements of the applicable law and that if a more liberal
attribution of expenses is made to a political committee such is
within a candidate's discretion.
We intend to now implement with respect to future travel by the
President, this treatment for attribution of such travel costs.
We would appreciate very much any comments or suggestions
the Commission may think are appropriate to make with respect
to our treatment of the President's travel costs.
Sincerely,
W.
Buchen
Philip Buchen
Counsel to the President
The Honorable Thomas B. Curtis
Chairman
Federal Election Commission
Washington, D.C. 20463
27000 (Air Force One) (VC-137C)
Cost per hour:
$2,206.00
Passengers:
Approximately 50
26000 (Air Force One backup) VC-137C)
Cost per hour:
$2,206.00
Passengers:
Approximately 50
Jet Star (VC-140)
Cost per hour:
$ 889.00
Passengers:
8
White Top Helicopter (VH-3A)
Cost per hour:
$ 723.00
Passengers:
12
Huey Helicopter (VH-IN)
Cost per hour:
$ 262.00
Passengers:
8
DERALE FORD LIBRARY
PFC
Monday 11/10/75
9:20
Barry checked to see if we had received the memo
from Jim Connor on the President's Boston trip.
(We got a copy and Barry read it, talked with
Connor and made the note to you on the second page
advising of the conversation.)
LIBRARY REPAID M seal
THE WHITE HOUSE
WASHINGTON
November 10, 1975
MEMORANDUM FOR:
DICK CHENEY
FROM:
JIM CONNOR
I talked with Bob Visser this morning about how we should handle the
trip costs for Boston. You will recall that the President mentioned
his intention to run in the primaries and that this received quite a bit
of public coverage. The problem we face is that we have been telling
the Federal Election Commission and the press that it is appropriate
for the President in his role as Party Leader to raise money for the
party. The expenses for party fund raising should be borne by the
RNC and not chargeable to the President's campaign expenditure
limitations.
We have supported this position by argument that the President does
not on these trips talk about his own campaign or take any steps
publically to enhance his candidacy. In Boston, however, it was clear
that he did talk publically about his own campaign ratherthan solely
confining himself to the party efforts. For that reason we must
come up today with a decision on how we intend to handle inquiries
about costs of the trip. We have three choices:
(1) Announce that the PFC will pay for the entire costs
of the trip. This approach would parallel our treatment
of political trips where a single major political
activity makes the entire stop political.
Bo Callaway urges against this approach and
suggests that it is an unnecessarily strict
intrepretation of the law.
(2) Announce today that the PFC and the RNC will
share the costs of the trip on a 50/50 basis.
This approach is acceptable to Bo. It is likely
that when the FEC rules on the question of how
subject costs should be allocated that they will
require no more than a 50/50 approach.
FORD
STATE
-2-
(3) Announce today that there will be an allocation
of costs. The exact distribution is now being
worked on by the RNC and PFC and will be
reported shortly to the FEC. Have Nessen
announce this and also state our policy has been
to review all trips after the fact.
We should be prepared to let Nessen deal with this question at his
briefing this morning.
R. FORD LIBRARY
THE WHITE HOUSE
WASHINGTON
November 10, 1975
MEMORANDUM FOR:
DICK CHENEY
FROM:
JIM CONNOR
I talked with Bob Visser this morning about how we should handle
the trip costs for Boston. You will recall that the President
mentioned his intention to run in the primaries and that this received
quite a bit of public coverage. The problem we face is that we have
been telling the Federal Election Commission and the press that it
is appropriate for the President in his role as Party Leader to raise
money for the party. The expenses for party fund raising should
be borne by the RNC and not chargeable to the President's campaign
expediture limitations.
We have supported this position by argument that the President does
not on these trips talk about his own campaign or take any steps
publica bly to enhance his candidacy. In Boston, however, it was
clear that he did talk publically about his own campaign rather than
solely confining himself to the party efforts. -For that reason we
must come up today with a decision on how we intend to handle
inquiries about costs of the trip. We have three choices:
(1) Announce that the PFC will pay for the entire costs
of the trip. However Bo Callaway urges against this
approach and suggests that further it is unnecessarily
strict in its interpretation of the law.
UNITED E. FORD LIBRARY
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(2) Announce today that the PFC and the RNC
will share the cost of the trip on a 50/50 basis.
This approach is acceptable to Bo. It is likely
that when the FEC rules on the question of
how subject costs should be allocated that they
will require no more than a 50/50 approach.
(3) Announce today that there is a question of
allocating the costs and that the PFC and the
RNC will propose a formula to the FEC which
if they approve will be implemented. This
approach is most acceptable to Bo and is the
one I would recommend since it appears likely
that if there is an allocation formula it would
SEAL R.FORD LIBRAN,
not be asstrict as 50/50.
We should be prepared to let Nessen deal with this question at his
briefing this morning.
10/11/75
PWB:
albng
I suggested to Jim that he modify following apprach:
Announce today that there will be ar a allocation
.t costs and that PFL & RNC arp now working
this out and will report to the FEL(but not
necessarily for their decision).
Also Nessen should point out that we review
after trips as well as before.
Finally, they should realize that this approach
Is not catirely consistent with FEC proposed
regulation h nd could be criticized by media.
Jim bought this approach t is chamging
memo.
Ban
Commissioner Memo #190
TELEPHONE COMMISSION MISSION states
FEDERAL ELECTION COMMISSION
Pit.
1325 K STREET N.W.
activities
UNITED STATES OF THE
WASHINGTON, D.C. 20463
November 19, 1975
MEMORANDUM TO: The Commission
THROUGH:
Lan Potter
FROM:
Jack Murphy Jm by of
Attached find a copy of the draft opinion in AO 1975-72.
The position taken reflects the consensus expressed at the
allocation task force meeting of November 17, 1975. Pursuant
to the Commission's instruction to this office of November 18,
1975, the opinion is forwarded for action on the agenda of
the Commission's meeting of November 20th.
Attachment
SEALE FORD LIBRARY
REVOLUTION THEM BE
For Mas 1975
AGENDAITEM
1776.976
Agenda itcm No: IIB8
Exhibit No:
ADVISORY OPINION 1975-72
Application of Contribution and Spending Limits
in 18 U.S.C. §608 to Presidential Candidate's Travel
for Party Purposes
This advisory opinion is rendered under 2 U.S.C. $437£
in response to a request by a Republican National Committee
(hereinafter RNC). The request was published as AOR1975-72
in the Federal Register for September 24, 1975 (40 FR 44041)
Interested parties were given an opportunity to submit written
comments relating to the request. Numerous comments were
received by the Commission.
If
The request asked specifically whether
the
Federal Election Campaign Law of 1974
...
(has)
...
application to
(a)
national party's payment of
expenses incurred by the President of the United States, the
Vice President of the United States, and their aides while
engaged in national, State, or local party promotional activities?"
It is the opinion of the Commission that a political party
may designate any person to represent them at a legitimate party
promotional event. If such person is a candidate under the Federal
Election Campaign Act, as amended, the Commission will presume after
January 1 of an election year, for reasons noted infra, that the
- 2 -
candidate's appearances benefit his candidacy directly and
must be treated as subject to the provisions of the FECA, as
amended. The Commission is also of the opinion that candidate
appearances at a legitimate party promotional event, prior to
January 1 of an election year are party building in nature and
are not inherently intended to influence the candidate's nomina-
tion for election to Federal office. Therefore, these appearances
are not subject to the limitations of the FECA, as amended, as
long as all other candidates for nomination to the same office
are treated fairly.
Since President Ford is a candidate within the meaning of
2 U.S.C. $431 (b) (2) and 18 U.S.C. §591 (b) (2), the question to
be answered here is whether a political committee's payment to
a candidate for his expenditures in connection with an appearance
at a legitimate party promotional activity is "made for the
purpose of influencing the nomination
of (the candidate)
to Federal office
"
(See 2 U.S.C. $431 (f), 18 U.S.C.
§591 (f) )
The FECA implicitly recognizes the role of political parties
in our electoral process and encourages stronger and more com-
petitive, major, minor and new parties through the payment of
Federal monies.
The report of the Senate Rules and Administration Committee
issued to accompany S. 3044 (Report No. 93-689) expresses this
point:
- 3 -
11 (the) Committee agrees that a vigorous party
system is vital to American politics and has
given this matter careful study
Parties
will retain their essential nonfinancial responsi-
bilities in electoral politics
[P]arties
will play an increased role in building stronger
coalitions of voters and in keeping candidates
responsible to the electorate through the party
organization
[P]arties will continue to
perform crucial functions in the election apart
from fundraising, such as registration in voter
turnout campaigns, providing speakers, organizing
volunteer workers and publicizing issues. Indeed,
the combination of substantial public financing with
limits on private gifts to candidates will release
large sums presently committed to individual cam-
paigns and make them available for donation to the
parties, themselves. As a result, our financially
hard-pressed parties will have increased resources
not only to conduct party wide election efforts, but
also to sustain important party operations in between
elections."
See also, comments of Rep. Bill Frenzel in Congressional Record,
H. 10333, daily ed., October 10, 1974).
While there is no question, given the nature and functions
of the RNC, that such appearances can and do promote party-
building, there is also little doubt that when these appear-
ances occur in proximity to an election in which the President
is a candidate, the appearances may be reasonably construed to
confer a benefit to the President's own candidacy. Cognizant
of these realities, the Commission will divide President Ford's
- 4 -
party appearances into two categories: those occurring before
January 1 of the election year, and those occurring after
January 1 of the election year. The post January I appearances
will be presumed to be candidate-related and will be governed
by the relevant portions of the FECA, as amended. Those before
January 1 will be presumed not to be candidate related. The
Commission's conclusions may be rebutted upon a showing, inter
alia, that the solicitations for the party event, or the setting
of the event, or the remarks made by candidates who were
invited to attend were "for the purpose of influencing the
nomination for election, or election, of [that candidate (s)
to Federal office." (See 2 U.S.C. §§431 (c) and (f) ; 18 U.S.C.
$591 (e) and (f) .)
In situations where it can be shown that President Ford,
after the date he became a candidate, attended an event which
did not, under the preceding criteria, fulfill legitimate
party building purposes, the Commission assumes that the RNC
will treat its expenditures on behalf of the President as
contributions in kind, subject to the $5,000 limitation in
18 U.S.C. §608 (b) (2). In the event this limit is exceeded, the
President Ford Committee may repay the RNC for costs incurred
on behalf of the President and then list such repayments as
expenditures, subject to the provisions of 18 U.S.C. §608-(c).
1/ Since President Ford, on June 20, 1975, authorized a political
committee to receive contributions and make expenditures on
his behalf, at that time he became a candidate within the
meaning of 2 U.S.C. §431 (b) (2) and 18 U.S.C. §591 (b) (2).
- 5 -
The Commission notes that the matching payment period
for the payment of public funds to properly qualified Federal
candidates begins on January 1 of the presidential election
year (see 26 U.S.C. $9037 (b) At the very least, the
Congressional determination that the public payments shall
become available on January 1 supplies a persuasive suggestion
that Congress believed that date to mark the commencement
of increasingly serious presidential campaigning which will
consume an increasing portion of the candidate's time. This
justifies the view that almost all public activities engaged
in thereafter are candidate related.
The opinion expressed herein is distinguishable from
AO 1975-13 (appearing in 40 FR 36747) in which the Commission
indicated that "once an individual has become a candidate for
the presidency, all speeches made before substantial numbers of
people are presumed for the purpose of enhancing his candidacy."
When the statement is examined in context--namely as a response
to a question as to whether 18 U.S.C. §610 prohibited a
presidential candidate from receiving corporation paid travel
expenses for a speaking engagement before a local chamber of
commerce, it becomes clear that it is applicable only to an
appearance which in contrast to the present situation, serves
directly to benefit the candidate. This is not the case with
regard to party appearances prior to January 1 of the election year.
. GIV: LIBRARY
- 6 -
Although the views expressed in this opinion are
specifically applicable to the RNC, as the requesting party
herein (see 2 U.S.C. $437£), they would also be applied by the
Commission to presidential candidates other than President
Ford, should these candidates make advisory opinion requests
to the Commission alleging facts similar to those alleged
herein.
This advisory opinion is issued on an interim basis only
pending promulgation by the Commission of rules and regulations
or policy statements of general applicability.
Pres
THE WHITE HOUSE
Travel
WASHINGTON
November 20, 1975
MEMORANDUM FOR:
JIM CONNOR
THROUGH:
PHIL BUCHEN
R
FROM:
BARRY ROTH
SUBJECT:
FEC Decision on Presidential Travel
Per your request, attached is the text of the advisory opinion
adopted by a 5-1 vote today by the FEC on payment by the RNC
of Presidential travel expenses in connection with party
promotional activities. The Commission determined that a
political party could "designate any person to represent them
at a legitimate party event. " If that person is a candidate,
then appearances after January 1 of the election year are
presumed to benefit his candidacy directly and are subject to
the restrictions of the Federal Election Campaign Act. Con-
versely, appearances prior to January 1 are presumed to be
party building in nature and are not inherently intended to
influence the candidate's nomination for election to Federal
office. This presumption can be rebutted by the circumstances
surrounding a particular appearance, e.g., by the nature of
the audience, the substance of the President's remarks, the
use of banners with the President's likeness, etc. As long as
other Republican candidates for the Presidency are tr eated
equitably, party promotional activities in 1975 are not subject
to the limitations of FECA.
If we have not yet publicly stated so, we believe it is to our
advantage to point out that some portion of the Boston and
Georgia-North Carolina trips will be paid by the PFC, and
that the exact proportion of the allocation between the PFC
and RNC can only be made once all the bills have arrived.
To wait any longer, we risk appearing to respond to a
STATE FORD VIBRARY
complaint, rather than having initiated the allocation as we
did. Benton Becker agrees with this recommendation. We
defer to you for a decision and appropriate follow-up.
You should also be aware that the DNC has publicly stated
that it is contemplating challenging today's decision in court.