report of the audit division

on

San Diego host committee/sail to victory ’96

EXECUTIVE SUMMARY

The San Diego Host Committee/Sail to Victory ‘96 (the Host Committee) registered with the Federal Election Commission on September 8, 1995, as a host committee in connection with the City of San Diego’s responsibilities as host city for the 1996 Republican National Convention.

The audit was conducted pursuant to 11 CFR §9008.54 which states that the Commission will conduct an examination and audit of each host committee registered under 11 CFR §9008.51. The Host Committee received and disbursed approximately $23 million.

The findings of the audit were presented to the Host Committee at an exit conference held on May 20, 1997 and in the Exit Conference Memorandum. The Host Committee’s responses to those findings, as well as those of the 1996 Committee On Arrangements for the Republican National Committee (Committee On Arrangements), are contained in the audit report.

The following is an overview of the findings.

Convention Related Expenditures — 11 CFR §9008.52(c)(1) The Staff concluded the Host Committee made in-kind contributions to the Committee On Arrangements in the amount of $2,128,122. The transactions involved three vendors: Weldon Williams and Lick for convention badges and tickets; AT &T for an electronic voting system; and, David Nash, Inc. for the production of the live event and the related television coverage. The Commission determined that amounts paid to Weldon, Williams and Lick, and AT&T were permissible Host Committee expenditures. In addition, amounts totaling $1,096,979 paid to David Nash, Inc. were determined to be permissible Host Committee expenditures, while amounts totaling $892,489 were impermissible. These amounts are in-kind contributions to the Committee On Arrangements.

City of San Diego Events Fund 11 CFR §9008.53(b). The Staff concluded that the City of San Diego Events Fund (Events Fund) failed to comply with the restrictions placed on municipal funds. Specifically the Events Fund accepted donations from persons outside the San Diego Metropolitan Area, during the period through the convention its activities were restricted to the Republican National Convention, and it both solicited and accepted donations designated for use in connection with the Republican National Convention. The Events Fund received donations totaling $6.7 million all of which was transferred to the Host Committee. At least $3.5 million of that amount was initially received by the Host Committee, forwarded to the Events Fund for deposit, and subsequently transferred back to the Host Committee.