A bipartisan group of seven well-known campaign finance lawyers, including a bipartisan group of three former Federal Election Commission (FEC) chairmen, today petitioned the FEC to propose new rules providing for improved forms and instructions and to implement the Administrative Fines Program (AFP) law adopted last year.
The petition notes that grassroots “or unsophisticated filers are often led astray by the current forms, and that even sophisticated filers must guess about how to translate their conduct to the forms’ categories and design quirks. The consequences include not only unnecessary legal exposure for filers struggling to comply with the Act’s reporting requirements, but also inaccurate Commission data as apples and oranges are often reported as each other.”
The eight-page petition for rulemaking was made under the Administrative Procedure Act (APA), a federal law that says that all federal agencies must provide for “the right to petition for the issuance, amendment, or repeal of a rule.” The experts say their proposed changes “would materially improve the ease of filing and the quality of reports” filed with the FEC. The petition “would enable regulated committees to comply with the Act’s reporting and disclosure requirements, could be adopted on a fully bi-partisan basis, and would advance the goals of statutory compliance, enforcement, and sound legal administration.”
Last October, many of the same lawyers jointly wrote the FEC to praise its bipartisan action on rulemakings “to conform FEC rules to recent Supreme Court decisions.” The earlier letter said that “additional opportunities” exist “for the FEC to undertake similar actions… that would contribute significantly to the clarification of, and successful compliance with, the law.” The petition suggests “two reforms that present such opportunities.”
The signers of the petition volunteered their time over the last several months to identify and make specific recommendations to the FEC. Each signer participated as an individual interested in improving campaign finance regulation and not as a representative of their firm or clients. The group’s goal was to assemble a bipartisan effort to move needed reforms that should attract widespread support. The recommendations address a core function of the FEC, disclosure, and calls for changes that would better reflect and implement existing law.
Those signing the petition are (background or organizations are listed for identification purposes only): Robert F. Bauer, Partner, Perkins Coie, former White House Counsel; Allen Dickerson and former FEC chairman Bradley A. Smith, Legal Director and Chairman, respectively, of the Center for Competitive Politics; Benjamin L. Ginsberg and former FEC chairman Donald F. McGahn, Partners, Jones Day; Laurence E. Gold, Partner, Trister, Ross, Schadler & Gold; and former FEC chairman Robert D. Lenhard, Partner, Covington and Burling.
The petition urges that the FEC write regulations to implement six new categories of minor reporting violations identified in the (AFP) law adopted a year ago. The categories include certain types of reports for independent expenditures, electioneering communications, bundling and convention and host committees.
The group’s petition says that forms “should not require sophisticated accounting techniques” that are “unnecessarily complex and confusing.” To simplify reporting, it recommends a new schedule for reporting all in-kind contributions, and dispense with the requirement that in-kind transactions be, counterintuitively, reported as expenditures.” Political committees that accept in-kind contributions must report both the contribution, but also list the contribution as an expenditure, which can confuse both the filer and citizens who read the form.
The petition calls on the agency to “create a separate reporting form for political party committees, and thoroughly redesign” the current form that must be filed by all political committees registered with the FEC. The petition suggests all forms and instructions be revised to “reflect regulatory, judicial and administrative legal developments” and to “separate true federal operating expenses, such as rent, travel and the like, from direct political-activity expenses—such as GOTV—that are not contributions or independent expenditures” and make nine other changes to improve the clarity of reports and ease reporting burdens.
The petition also calls on the agency to acknowledge that the costs of certain types of independent expenditures are not known in time to file 24- hour and 48- hour independent expenditure reports “and clarify that committees need only engage in best efforts to reasonably ascertain the value of expenditures” in the filings.
The petition notes that “Independent expenditure only committees (“IE PACs”) —sometimes colloquially called “Super PACs” (though most accurately described as non-contributing committees) —have been explicitly lawful since 2010, following the decision in SpeechNow.org v. FEC, but current forms do not allow for such PACs to declare their independent status.” This could be done, the petition says, by simply adding a check box to an existing form. Forms filed by these groups to report contributions also lack space to report corporate or labor organization contributions.
The petition recommends a similar check box for the registration form for hybrid PACs, which are often called “Carey” accounts after another court decision. Other suggestions are offered to streamline reporting for these hybrid accounts.
The full text of the petition is available on the Center for Competitive Politics’ website, here, and at Robert Bauer’s blog, More Soft Money Hard Law, here.
