This file contains archived live captions of the open meeting of the Federal Election Commission held on August 10, 2023. This file is not a transcript of the meeting, and it has not been reviewed for accuracy or approved by the Federal Election Commission. ________________ THE OPEN MEETING FOR THIS THURSDAY, OCTOBER 10th WILL BENTZ TODAY.Ê I MOVED TO SUSPEND THE RULES ON THE AGENDA DOCUMENT SO THAT THEY MIGHT CONSIDER THE LATE SUBMISSION OF THE AGENDA DOCUMENT.Ê ALL IN FAVOR. MOTION PASSES UNANIMOUSLY. FIRST UP ON THE AGENDA IS THE APPLICATION OF RULEMAKING REGARDING ARTIFICIAL INTELLIGENCE.Ê Thank you, Madam chair. It has a draft submitted by public sentiment. That the federal election campaign acts regulatory provision with the fraudulent representation to have artificially intelligent campaign. A rulemaking based on this petition. He will run for 60 days following the publication of the notification and the federal letter. After the comment period has concluded and has been considered, the commission may decide to initiate rulemaking. Thank you, I'm happy to answer any questions you may have.Ê Madam chair.Ê Yes.Ê Thank you, Madam chair, thank you to our colleagues. As I noted in the last consideration of this question, I have voted to publish petitions for rulemaking and invite public comments. Regulations are clear. They set the extraordinarily low bar. There are certain requirements for the publishable commission. The first effort, as noted at the time, failed to me to the rock bottom standard. I agree that the second petition reads the regulation. Especially when they are principally intended to drive press coverage. We are bound by regulations. I will be voting in favor of publishing the notes. We are bound by the statue. Making some attempt to explain why, in its word, the deep fake audio clip by the agent that shows the opponent saying or doing something they did not do would violate the law. Neither the petition or any friends in Congress have a petition of that argument. I am unconvinced. The statute prohibits a person fraudulently misrepresenting himself as acting for or on behalf of of another candidate. That is the point. It is limited and is directed at fraudulent agency. In other words, pretending that you yourself represent or work for another candidate. It does not claim that your opponent said or did something that he or she did not do. It would be news to many to learn that they can police candidates telling lies about their opponents. That was Congress's choice. They want to revisit that choice and grant has broader authority. As this Congress is right, it has chosen to ignore that request. There is nothing special about deep fakes or the generative AI in the context of this petition. If there are fraudulent attempts to show that the opponent showed or did something they did not do, it should not matter how the fraud is accomplished. Lying about somebodies private conversations or adding sound effects in postproduction or airbrushing a photograph, if intended to deceive already would violate our statute. The fact that a public citizen points to no authority, no comment, no enforcement action, no case, because it is a powerful problem. I highlight these problems because I hope commentators will grapple with limited authority rather than asserting that the FEC does something. Their comments to provide legal arguments to act in this area. We ask for such authority in the past. Relatedly, their First Amendment concerns in the background. Precision of regulation is a requirement in our work. The commission has authority to act in this area, they can demonstrate to tailor a regulation. With those preliminary thoughts, with Madam chair, I hope that will guide the comments that we received. I look forward to reading the public's comments.Ê Further discussion.Ê Thank you, Madam chair. I am pleased that it looks like we will be able to publish this in the Federal Register this time. I support this one, the lawyers reviewed the petition and found it in compliance. It is a topic that is very timely and very important. I do not pretend that the FEC can solve problems in the field of AI. We can solve some of them. The document before us as so that they will not consider the merits until after the comment period closes for what we can and cannot do.Ê Further discussion.Ê A question to counsel, when do we anticipate the publication of this? When will the close of the comment period generally be?Ê If I may, Madam chair? Normally it takes a few days, up to a week after we transmit a document. I would expect if we were going to get this over to them tomorrow by sometime next week, it should appear. It would be 60 calendar days from that date. Whenever that falls, that would be the close of the comment date.Ê The earliest would be mid-October? Thank you, Madam chair.Ê We are getting further discussion. Wonderful.Ê Thank you, Madam chair. I moved the adoption to agenda document --Ê All in favor.Ê Aye.Ê Motion passes unanimously. Next we have the draft advisory opinion 2023-5 with the request for counsel and former councilmember Matthew Peterson is here today. Presenting for OG C. Everyone getting settled. Whenever you're ready.Ê Thank you, Madam chair. Good morning to the rest of the commissioners. Three draft responses by Alamo pack. A leadership pack that uses the existing hard money contribution to federal candidates and committees. To open a second hard money no contribution account where they will get contributions with the act for the sole purpose of making independent expenditures. In the alternative, if the commission finds that it does not have this proposal, the second account can be ministered and overseen by a special committee was members are appointed than his decision-making is not approved by the senator. Draft A concludes that no, the second account would not be permissible under the act. It will not aggregate contributions to both accounts and treat each account as if it has a separate contribution limit. That would allow them to raise as much as $10,000 per contributor per year, in excess of the limits laid out in the act. For the same reason, because the second account would still be part of the entity that was established by the senator even if it was overseen by a special committee as proposed, draft A finds it impermissible under the act. Draft B includes that yes, the proposed second account is permissible because nothing in the act were permissible regulation prohibits them from opening a second account and getting more contributions for the sole purpose of making independent expenditures. Drop C agrees with draft A with respect to the primary request. The alternative request would be permissible. If it stops them from opening the second account under the operating management structure, if it was overseen and proposed, it would not be financed or controlled by Senator Korman and that would not violate the act. One comment on the request and no comments on the draft. Happy to answer any questions.Ê Thank you, colleagues, questions?Ê Thanks, Madam chair. A question for the requester's counsel. An open-ended one, we did not receive any comments on any of the drafts. One comment on the request. I would be interested on your views on the three drafts, the merits and demerits of those on which one you think is the best statement of the law.Ê Let me see if I can frame this a little bit for the commissioners for our point of view and for those watching online. Those today, if they created the independent expenditure, Senator Korman could raise $5000 for that pack. If they can open that and continuing to solicit, they can do those things separately, there is no doubt. The carry decision tell us that they can do that together. You do not lose your right to due separately what you do collectively. We think draft B is most consistent with the request. Draft C would be consistent with our request because it says yes to the alternative. I would actually like to ask the commissioners for a little bit of clarification. If that is the draft that is approved and we have the ability to create a second committee, I would like some clarification so we know the intent of the drafters if that committee would be subject to the $5000 limit or if they can oversee the account that raised unlimited funds. He would be limited to the $5000. Mike confirmed with draft A is that it runs a citizens United and the carry decision, it would be contrary to law because citizens United has told us that independent expenditures by their nature do not create corruption. In light of that, and in light of the motion that you do not lose the ability to do separately what you do collectively, draft A is inconsistent with the law.Ê I think the response to that from a critic, someone in the comment said that the hypothetical about the treasurer having eight separate committee, they are affiliated. Then they are subject to a single contribution limit. You might say that Kerry is wrong. If Kerry is correct, that is what the treasurer does, two separate accounts. What do we do with that? The affiliation regulation that says if a single person establishes multiple committees and they are affiliated because they are started by the same person and they are subject to a single contribution limit. Do we it is to roll prevent the invasion of contribution limits. Setting up four different committees that are making contributions and raising $5000 from a single person into each of them in a calendar year and of aiding the contribution limit and with the outbound contributions from those two candidates if it is a multi-candidate committee or not, that is what the affiliation rules are designed to prevent, when we are talking about money that will only be used for the independent expenditures, there is no contribution limit, those dollars do not create corruption or the appearance of corruption, we do have the rule that applies to Senator Korman. I do not know. I think they are wrong on the affiliation rules. The professional treasurer, I do not know for how many other committees. Not every single one of them is affiliated with Senator Korman.Ê One more question. One of my concerns with draft A, it is question begging. It would violate the money provisions because he would be soliciting money in excess of the contribution limit. The $5000 is the limit and it can only apply to a single account. I have struggled with the clarity of the statute, it is the same $5000 limit issued in Terry. You know, something that was flagged in the public commentary by another member of the bar, Senator McCain with his statements about the McCain triangle made reference to the idea that leadership PACs might have more accounts. The idea that there could be federal accounts, nonfederal accounts within a single leadership pact. How clear is the statute about the limits on the number of accounts that can be within the leadership pact. The statute does not say anything about the concept of the First Amendment for citizens United. I do not think that the statute speaks to this concept. Not seeing that there would be this expenditure account. He opened the door that he did not get that money.Ê Thank you, thank you to the vice chairman who anticipated some of my questions. I want to pick up on similar themes. I agree with you, counselor that the holding of Kerry applying principally, Emily's list, I'm quoting you here, you do not lose your right what you do to tell her what you do separately, the question is, let's take your hypothetical about the treasurer of Alamo PAC having a new committee. I understand your point about the senator's ability to solicit for that committee. He would not conceive that senator -- to that committee. Am I wrong?Ê In my hypothetical, it would be signed by the treasurer. Even the notion of the officeholder establishing the leadership FEC comes from the statute and that refused to the committees that may contributions to candidates. I would say that Senator Korman controlled that separate hypothetical committee that the treasurer set up.Ê I think I agree with you. My question is, do you believe that the senator would EFM see the second account. There is apples to oranges comparison there.Ê The PAC exists and it is affiliated with Senator Korman and it would open by the treasurer. He would not be a signatory on the account. Depending on what the commission tells us. We do not believe it would be controlled by SenatorÊ It is a second hard money contribution limit. The senator is spending out of that account.Ê No, I am not, unless the commission tells us that he has to be off of there.Ê I guess I am back to -- let me set the table a little. I was involved in the Kerry litigation. I think you are correct in your opinion. In that case, Admiral Kerry was able to establish two different committees, one unaffiliated hard money committee for the contributions. He was allowed to control those both. To the vice chairman's point, it did not matter if those separate committees were affiliated. It is a matter of constitutional law that there was not a limit for the independent expenditures. In some sense, it did not matter. My question is, could a sitting senator establish a separate super PAC with no limit on contributions just as Admiral Kerry did. Is there something special about his status that prohibits that?Ê He could have a separate political committee as long as it is subject to the $5000 limit. I do not think the affiliation rules apply to those committees because it is designed to roll prevent the aversion to contribution limits. I hope that helps.Ê Does. The problem, we are back to this question, if Senator Corman would not EFMC the money coming out of this second account that he would like to establish as part of his leadership PAC, I am not understanding what it is doing, one. Two, I'm not understanding why the client is not requesting to establish a straight Kerry account. Why are we imposing a contribution on it at all. The theory is that this is just like in Kerry, there is no corruption interest.Ê Because federal officials and officeholders are subject to not spending money beyond the prohibitions of the act. In that context they can solicit the $5000 per calendar year. For individuals not corporate or otherwise.Ê Let me ask it a different way. Would you say that contributions made to the second account are contributions? Within the meaning of the act?Ê They are independent expenditure dollars.Ê I ask this because you reference to the advisory opinion from 2006. Which allowed for money to be provided to a recount account. I thought that was very interesting because it seems to be getting closer to the facts here are. And that AO, there was a commission afforded to the vote. The commission's reasoning was that money given for a recount is not a contribution at all. That was sort of the legal hook for permitting those additional contributions. How do we legally think of the money going into the hypothetical second account?Ê I think the commission following speech now has said that because of the independent expenditure dollars, when they are spent, are expenditures under the act. Those committees register the report with the commission instead of the IRS. Again, the technical definition of contribution has to apply because we look at the contributions under the act. I think of contributions that are for the purpose of funding the committees when individuals give money to the independent expenditure committees, the commission regulates those because there is a purpose in those expenditures.Ê Okay. I guess another question then. In terms of the practical governance of the leadership committee, what do you see as the difference? This is going back to the question that I opened with. The difference between how the second account would be governed under your backup plan of the independent board that would be making decisions as to the contributions and expenditures out of that account, versus if it was a second account of regular order for the leadership committee.Ê Under draft B, let's just hypothetically say that it accumulated $100,000, Senator Corman can participate on the decision, if he could decide and weigh in on whether that committee can make a contribution to a another super PAC and whether they are in support or opposition to another candidate. If draft C was approved, Senator Corman would be walled off and they would make the decision on if that should be spent on a particular candidate work contributed to another super PAC .Ê I appreciate that. I think that is right. Again, I will give you another bite. If the senator is controlling spending decisions, how is it not EFMC?Ê He is not financing it, it is not his money. He would have some control over it. The whole EFMC concept was getting back to the hard dollar when you are talking about contributions to candidates. This is outside of that. This is independent expenditures.Ê The concept simply does not apply for the committees?Ê I think that is right, Commissioner.Ê I appreciate that. Thank you. Sorry that got a little bit technical.Ê Thanks, Madam chair.Ê Folder discussion.Ê Thank you, Madam chair. What is the limiting principle of this? If you can set up a second account and raise $5000 for the donor into that second account, what would preclude him from setting up a third account, 100 account, raising $5000 from the same donors into each of those accounts?Ê In this case, Your Honor, Commissioner, sorry. I think it would be because it is under the same committee. I think of the senator were to establish multiple accounts, you could create through the advisory or regulatory process a concept that would link those together so that the ability to raise the $5000 was not multiplied elevating the limits that are applicable to the federal officeholders. That is not what we are proposing here, we are proposing a limited rule.Ê You are only asking to open one other account. He could've made the limit by setting up another $5000 account. I do not see where the legal rationale would include someone else from coming along and saying that I can set up 100 separate accounts.Ê Your Honor, commissioners, there are multiple super PAC that exist right now that he could solicit for. He could solicit for a string of super PAC at the $5000 limit.Ê You could amend the draft B to say that this would apply to any other attempt at creating multiple account so that he can only solicit one $5000 contribution per calendar, per individual that he controls. We could do that. That might delay your concerns if you want to insert a sentence about that in there.Ê Yes, we could say that. My problem is that I do not see how we get past the $5000 limit to the second account. I think the save a rationale that would preclude the 10th and 100 account also has the second account. He is limited to $5000 in a PAC that he has established. There is no question that he has established his own leadership .Ê I think I would agree with you if there was a statutory or regulatory definition of but there is not. You do not find the concepts of super PAC in the statute. You do not find it in regulation. Until Congress or this commission reports to regulate those beyond what the courts have done, I think that citizens United will lean towards the approval of agenda item B.Ê I agree with you. There is a need for some regulation or acknowledgment in our regulations the existence of super PAC . That is a bigger question that we have in front of us today. Let me switch topics a little bit. If draft C was to prevail, you suggested that you could wall off the senator from this second account and that other people who would somehow come forward to run those for him, how would this second account be organized? Other than by the senator and his agents?Ê If draft C is what the commissioner is willing to approve, we are open to the consideration of the limitations that the commissioner may apply. The supplemental response is pretty clear that we are open to how that committee is comprised. Obviously the one limitation is that the committee will not be created by Senator Corman.Ê I hear that, it is the practicality that I cannot figure out how to do that. How this would happen if not by his instruction, then by the instructions of his agents. People who work for him and are part of his political organization. Someone has to set up the committee of the organization I needs to set up a separate account.Ê There is a history of a notion of separate control inside political committees. In the place of foreign-based corporations, you can limit who controls those in the case of state parties when the federal officeholder is sharing the state party, this is not a foreign concept given where the commissioner has been in regulating the hard dollar PACs. Making the state parties separate committees. This is not a foreign concept. I think if the commissioner wanted to impose limitations on how the special committee was selected or operated, we would be open to those.Ê I think the closest analogy that you have is the Kelly AO. The distinction is that a Congresswoman in that case was the transitory chair of a long-standing committee. That went before her and after her and had other staff that she appointed and was not responsible for. The committee had its own function separate and apart from her. This is the senator's leadership PAC which has no function other than to advance his leadership goals. That is the whole premise. It is associated with him. It is his entity. He has established it. Again, as my colleague would say, it is apples and oranges.Ê Under citizens United and speech now and under the Kerry decision, because he can do it separately, I think the commission is violating the principle saying that he cannot do it together. That is why we oppose draft A.Ê Thank you, Madam chair. I want to think counsel for the discussion today. It has been very helpful. One of the points that was just mentioned, there has been a lot of discussion on the control. It is distinguishable from what we are looking at here. Control was the leading issue in that matter. It is not for me here. Draft C, the problem with draft C, it ignores the discussion of establishment. In your request on page six, you ask the commission if the committee may establish a non-contribution account. Are we walking to the problem with the EFMC, you acknowledge that you have to establish this. You have to form of this entity before we can move to the issues of control. They are talking about if we have the treasurer. Direct or indirect establishment. The EFMC is not resolved here. They can take control. I do not think we can even get to those. Establishing, you are acknowledging that the senator is establishing the second account.Ê The treasurer would be the one opening the account.Ê The treasurer is an agent of the committee?Ê Yes, the treasurer is an agent of the committee.Ê Would that be direct or indirect establishing the account?Ê There is apples and oranges going on here. The EFMC rules are designed to prevent the evasion of contributions. There are not contribution limits because the Supreme Court had said no. That is the difference here. If Senator Corman could solicit $5000 for any -- that was out there for an individual calendar year, why not one that is a subaccount of his leadership PAC, that is the question we are asking.Ê Commissioner Bussard?Ê Thank you, Madam chair. I was pausing dramatically in case there were additional questions.Ê There are.Ê I'm happy to yield to commissioner Dickerson. The last comment. The difference is that as a member of Congress, he is covered by 30125E and he is not like every other person on the planet, if you are not a member or a candidate, you are not subject to the limits. But he is. As is any other entity that is financed or maintained or controlled by him. I do not see any way that this second account is not a second account within a PAC that he created, he established, we acknowledge that much. And however it is organized, this second account would be established by the senator or by his agents. I do not see how you get around 30125E.Ê Mr. Dickerson.Ê And related questions, I suppose. I would like to express my sympathy to counsel, I have said on numerous occasions that the EFMC regulations are not a model of clarity and they are contrary to the law in certain details. This is a difficult but satisfying discussion. Going back to this question of agency which I think is important. Regulations limit agencies for the actual agents. Two part question. The treasurer is the agent of the candidate or of the committee? And two, what is the scope of that agency for the purpose of the second account?Ê The treasurer is an agent of the committee. The treasurer would be responsible for spending from the second account. If somebody said hey, why don't we spend money? He would say, no, that is a coordination problem. And would be able to say no. Or if they said why don't we cut a check to a candidate from this second account, the treasurer would have to say no, that is not a contribution account.Ê I think that is right.Ê The treasurer has oversight over that account.Ê I agree with that. I wanted to switch gears and talk about draft C. You asked for some guidance on it. I am a little uncomfortable in the sense that the idea of the advisory opinion close to regulation is to answer a question involving facts that are developed by the requester as opposed to the facts against the whole world. The regulation or statute. I guess let me ask this, if draft C was adopted, would the treasurer or the individuals making decisions about the disbursements from that account, would they be actual agents of the senator?Ê No.Ê Why not?Ê The senator would not be involved in picking them, directing them, or supervising their actions.Ê That analysis would apply for each of the initials, right? Of the EFMC prohibition, which was written by a Congress as a tongue twister for FEC commissioners.Ê That is correct.Ê I have another question. With that, I will turn it over for votes.Ê Thank you, Madam chair. In respect to the advisory committee and the approval of the agenda document.Ê A discussion and motion. All those in favor. Aye.Ê Aye.Ê No.Ê No.Ê Thanks, Madam chair. 2023 e- five of approval of document draft B. Movie all in favor. Aye. Nuveen all opposed, no.Ê No.Ê It fails, 1-5 with the vice chair in favor.Ê Madam chair?Ê In the opinion of the 2023 e- 05 the adoption of agenda item 23 e- 19 Dosh CÊ All those in favor?Ê Aye.Ê All opposed?Ê No.Ê Motion fails, 2-3. Thank you, counsel for being here and for answering your questions.Ê Thank you, Commissioner.Ê Are there any management or administrative matters that we need to discuss?Ê There are no such matters.Ê That concludes the agenda, we are adjourned.