This appendix explains FEC rules governing the financing of delegate selection activity with respect to a national nominating convention. Much of the information presented here does not apply to party committees, particularly the material on expenditures and affiliation. The appendix is included because it may be of value to party committee staff and other individuals who plan to seek selection as delegates.

The Commission also offers a reprint of this appendix as a separate handout. To order, call 800/424-9530.

Definitions

Delegate

The term “delegate” means an individual who is seeking selection as a delegate, or who has already been selected as a delegate, at any level of the delegate selection process (local, state or national). 110.14(b)(1).

Delegate Committee

A “delegate committee”[1] is a group that raises or spends funds to influence the selection of one or more delegates. A delegate committee may be a group of delegates (defined above) or a group that supports delegates. 110.14(b)(2).

FEC Reporting

By Registered Delegate Committee

A delegate committee becomes a “political committee” under federal law once it receives contributions or makes expenditures exceeding $1,000 in a calendar year. 100.5(a) and (e)(5). At that point, the committee must register with the FEC within 10 days and begin filing periodic FEC reports on its receipts and disbursements. 102.1(d) and 104.1(a). All pre-registration activity must be disclosed in the first report. 104.3(a) and (b).

Note that a delegate committee that has triggered status as a federal political committee must include the word “delegate” or “delegates” in its name. It may also include the name of the Presidential candidate it supports. 102.14(b)(1).

By Individual Delegates and Unregistered Delegate Committees

Individual delegates and delegate committees that have not qualified as political committees under federal law are not required to register or file regular reports. But, if they make independent expenditures exceeding $250, they must disclose the expenditures on FEC Form 5. 109.10(b). (Independent expenditures are discussed later in this appendix.)

Funds raised and spent for delegate selection are considered “contributions” and “expenditures” made for the purpose of influencing a federal election[2] and are therefore subject to the federal law’s prohibitions and limits.[3] 110.14(c)(1).

For example, a delegate must use funds permissible under federal law to pay for travel to attend the national convention and related food and lodging expenses. AO 1980-64. The next two sections discuss contributions and expenditures in detail.

Please note that the prohibitions and limits apply to contributions of goods and services (in-kind contributions) as well as monetary contributions. 100.52(c)-(d).

Prohibitions

Individual delegates and delegate committees may not accept any contributions from prohibited sources. 110.14(c)(2).

The following entities are prohibited from making contributions:

• Banks and other corporations (including nonprofit corporations);

• Labor organizations;

• Foreign nationals, that is, those who are neither U.S. citizens, U.S. nationals, or lawfully admitted to the U.S. for permanent residence (“green card” holders); and

• Federal government contractors (such as partnerships and sole proprietors with federal contracts). 110.20; 114.2(a) and (b); 115.2; 115.4; 115.5.

Limits on Contributions to Delegates

• Contributions to a delegate committee are subject to an aggregate limit of $5,000 per calendar year. 110.1(d) and (m)(2); 110.14(g)(1).

• Contributions to an individual delegate are not subject to any per delegate limit. 110.1(m)(1); 110.14(d)(1). Note that contributions to a delegate from the committee of a Presidential candidate receiving public funds count against the candidate’s expenditure limits.[4] 110.14(d)(2).

• Contributions from an individual to a delegate or delegate committee count against the donor’s biennial limit on total contributions. 110.5(e); 110.14(d)(1) and (g)(2).

Limits on Contributions Made by Delegates to Candidates

When a delegate or delegate committee makes an expenditure that benefits a Presidential or other federal candidate,[5] the expenditure may result in an in-kind contribution to that candidate (as explained under “Dual-Purpose Expenditures for Communications,” below). Such contributions—or anything of value given to the candidate—count against the contribution limits. 100.52(a).

A delegate or delegate committee may contribute a maximum of $2,000 to a federal candidate, per election. 110.1(b)(1). The primary and general are considered separate elections but, in the case of Presidential candidates, the entire primary season is considered only one election. 110.1(j)(1).

Note that a contribution to a candidate must be reported by the candidate’s committee. For this reason, when making an in-kind contribution, a delegate or delegate committee should notify the candidate’s committee of the monetary value. Note also that in-kind contributions generally count against a publicly funded Presidential candidate’s expenditure limits.

Expenditures for Delegate Selection Only

Expenditures made by delegates and delegate committees solely to further their selection are not considered contributions to any candidate and are not chargeable to a publicly funded candidate’s spending limits. This type of expenditure might include, for example:

• A communication which advocates the selection of delegates only;

• Travel and subsistence expenses related to the delegate selection process and the national nominating convention. 110.14(e)(1) and (h)(1).

Dual-Purpose Expenditures for Communications

An individual delegate or a delegate committee may pay for communications that both:

• Advocate the selection of an individual delegate or the delegates promoted by the delegate committee; and

• Refer to, provide information on, or expressly advocate the election or defeat of a Presidential candidate (or candidate for any public office). 110.14(f) and (i).

As explained in more detail below, a portion of a dual-purpose expenditure may have to be allocated as an in-kind contribution or an independent expenditure on behalf of any federal candidate mentioned in the ad.

Moreover, the communication may have to include a disclaimer notice (also explained below).

Materials Distributed by Volunteers

Dual-purpose expenditures for campaign materials such as pins, bumper stickers, handbills, brochures, posters and yard signs are not considered in-kind contributions on behalf of the federal candidate mentioned in the materials as long as the materials are used in connection with volunteer activities (i.e., are distributed by volunteers) and are not conveyed through public political advertising.[6] 110.14(f)(1) and (i)(1).

Public Ads: In-Kind Contributions

A portion of a dual-purpose expenditure is considered an in-kind contribution to the referenced candidate if the communication:

• Is conveyed through public political advertising (or is not distributed by volunteers); and

• Is made in cooperation or consultation with, or at the request or suggestion of (i.e., is not coordinated with), the Presidential candidate (or other federal candidate) or the candidate’s campaign.

The contribution counts against a publicly funded Presidential candidate’s expenditure limits. 110.14(f)(2)(i) and (i)(2)(i).

Public Ads: Independent Expenditures

A portion of a dual-purpose expenditure for a communication that is conveyed through public political advertising is considered an independent expenditure (rather than an in-kind contribution) on behalf of the candidate if the communication:

• Expressly advocates the election (or defeat) of a clearly identified candidate; and

• Is not coordinated with the candidate or the candidate’s campaign. 109.21.

Independent expenditures are not subject to the contribution limits and are not chargeable to a publicly funded Presidential candidate’s expenditure limits. 110.14(f)(2)(ii) and (i)(2)(ii). Note that independent expenditures must carry a disclaimer notice (see below). Note also the reporting requirements for individual delegates and unregistered delegate committees at the beginning of this appendix.

For more information on independent expenditures, consult 11 CFR Part 109.

Allocation of Dual-Purpose Expenditures

The amount of a dual-purpose expenditure allocated as an in-kind contribution or independent expenditure on behalf of a candidate must be in proportion to the benefit the candidate receives, based on factors such as the amount of space or time devoted to the candidate compared with total space or time. 106.1(a)(1).

Expenditures to Reproduce Candidate Materials

Expenditures by a delegate or delegate committee to reproduce (in whole or in part) or to disseminate materials prepared by a Presidential candidate’s committee (or other federal candidate’s committee) are considered in-kind contributions to the candidate. Although subject to contribution limits, this type of contribution is not chargeable to a publicly funded Presidential candidate’s spending limits as long as the expenditure was not coordinated with the candidate or the candidate’s campaign. 110.14(f)(3) and (i)(3). If the materials are conveyed through public political advertising, they may have to include a disclaimer notice.

Disclaimer Notices

Any public communication made by a political committee – including communications that do not expressly advocate the election or defeat of a clearly-identified federal candidate or solicit a contribution – must display a disclaimer. 110.11(a)(1).

Printed materials must contain a printed box that is set apart from the contents in the communication.  The disclaimer print in this box must be of sufficient type size to be “clearly readable” by the recipient of the communication, and the print must have a reasonable degree of color contrast between the background and the printed statement.  110.11(c)(2)(i) - (iii).

A disclaimer is not required when it cannot be conveniently printed (e.g., pens, bumper stickers, campaign pins, campaign buttons and similar small items). 110.11(f).

Authorized by Candidate

If the communication, including any solicitation, is authorized by the candidate’s campaign, it must display the following notice:

“Paid for by [name of delegate or delegate committee] and authorized by [name of candidate’s committee].” 110.11(b)(2).

Not Authorized by Candidate

If the communication, including any solicitation, is not authorized by the candidate’s campaign (as in the case of independent expenditures), it must display the following notice:

“Paid for by [name of delegate or delegate committee] and not authorized by any candidate or candidate’s committee.” 110.11(b)(3).

Communications not authorized by a candidate or his/her campaign committee, including any solicitation, must disclose the permanent street address, telephone number or web site address of the person who paid for the communication. 110.11(b)(3).

Delegate committees—including unregistered committees—need to determine whether they are affiliated with another delegate committee or a candidate’s committee because affiliated committees are considered one political committee for purposes of the contribution limits—they share the same limits on contributions received and made. 110.3(a)(l). (There is, however, no limit on funds transferred between affiliated committees. 102.6(a)(1)(i).)

Between Delegate and Presidential Committees

Factors Indicating Affiliation

In determining whether a delegate committee and a Presidential committee are affiliated, the Commission may consider, among other factors, whether:

• The Presidential campaign[7] played a significant role in forming the delegate committee.

• Any delegate associated with a delegate committee has been or is on the staff of the Presidential committee.

• The committees have overlapping officers or employees.

• The Presidential committee provides funds or goods to the delegate committee in a significant amount or on an ongoing basis (not including a transfer of joint fundraising proceeds).

• The Presidential campaign suggests or arranges for contributions to be made to the delegate committee.

• The committees show similar patterns of contributions received.

• One committee provides a mailing list to the other committee.

• The Presidential campaign provides ongoing administrative support to the delegate committee.

• The Presidential campaign directs or organizes the campaign activities of the delegate committee.

• The Presidential campaign files statements or reports on behalf of the delegate committee. 110.14(j). See also, for example, Advisory Opinion 1988-1.

Effect on Expenditure Limits

If a delegate committee is affiliated with the committee of a Presidential candidate receiving public funds, all of the delegate committee’s expenditures count against the Presidential candidate’s expenditure limits.

Between Delegate Committees

Delegate committees established, financed, maintained or controlled by the same person or group are affiliated. Factors that indicate affiliation between delegate committees are found at 100.5(g)(4) of FEC regulations. 110.14((k).