AO 2011-02: Campaign committee may purchase copies of Senator’s autobiography if publisher donates royalties to Charity

The Scott Brown for U.S. Senate Committee (the Committee) may purchase copies of Senator Scott Brown’s autobiography from the publisher at fair market value, and the publisher may donate Senator Brown’s royalties from that purchase to charity. The Committee may additionally post a de minimis amount of material promoting the book on its website and social media sites. Senator Brown may also reimburse the Committee personally for the fair market value of the rental of its mailing and email lists to promote the book.

Background

Senator Brown will promote his book in a national book tour. His agreement with the publisher provides for the payment of advances as well as publishing royalties to be determined as a percentage of net sales revenue. Senator Brown and the Committee proposed a number of activities related to the book and the promotional tour.

First, the Committee wishes to purchase several thousand copies of the book for campaign-related activities, such as distributing the books as “thank you” gifts to campaign contributors and supporters.

The Committee plans to purchase the books either at the bulk rate or at the usual retail price if the bulk rate is not available. The publisher, under normal industry practice, may make the bulk rate available to large purchasers. Senator Brown proposes to donate the royalties from the Committee’s purchase of the book to a charitable organization. Alternatively, the publisher itself is willing to donate Senator Brown’s royalties from this sale to a charitable organization.

Second, the Committee proposes to promote the book by posting information on the Committee’s website. Under the Committee’s proposal, this information would consume no more than 25 percent of its home page. The Committee also proposes to use the social media sites Facebook, Twitter and LinkedIn by posting promotional information about the book and Senator Brown’s book tour.

Third, the Committee proposes to promote the book to individuals on the Committee’s email and mailing lists.

Fourth, when Senator Brown travels to promote the book on the national book tour, he proposes to host fundraising events for the Committee in the book tour cities. The travel costs of the book tour will be paid by the book’s publisher. Finally, the Committee proposes to have a campaign staffer collect email addresses from people who attend Senator Brown’s book-signing events while on the book tour. The Committee plans to use the email addresses that it collects to apprise people of Committee news and activities and for fundraising.

Analysis

Campaign purchase of book. The Committee may use campaign funds to purchase copies of the book from the publisher at the fair market price under the proposal where the publisher donates to charity the amount that Senator Brown would have otherwise earned as royalties from that purchase.

The Federal Election Campaign Act (the Act) and Commission regulations prohibit the conversion of campaign funds by any person (including the candidate) to “personal use.” 2 U.S.C. § 439a(b); 11 CFR 113.1(g) and 113.2(e)(5). Under the Act, “a contribution or a donation shall be considered to be converted to personal use if the contribution or amount is used to fulfill any commitment, obligation or expense of a person that would exist irrespective of the candidate’s election campaign or individual’s duties as a holder of Federal office.” 2 U.S.C. § 439a(b)(2). In several previous Advisory Opinions, the Commission has considered whether an authorized committee’s purchase of its own candidate’s book is personal use. See, e.g. AOs 2006-18 and 2001-08. Here, the Committee’s funds would be used to purchase the book solely for distribution as gifts to the Committee’s financial contributors and political supporters, and thus would be used by the Committee only for the purpose of influencing Senator Brown’s election to federal office. As in AO 2001-08, the publisher is willing to donate the resulting royalties to a charitable organization and not increase the royalty calculation that would go to the candidate.

Senator Brown may not personally accept royalties resulting from the campaigns purchase of his book, even if he then makes a charitable donation equal to that amount. Although the Act specifically allows campaign funds to be donated to a charity, it also provides that such a contribution or donation cannot be converted to personal use. 2 U.S.C. § 439a(a) and (b)(1). Senator Brown must not receive any benefit, tangible or intangible, from the publisher’s donation of the royalty amounts.

Promotional information. The Committee may post a de minimis amount of material promoting the book on its website and on social media sites such as Facebook, Twitter and LinkedIn without violating the restriction of personal use of campaign funds. The use of an authorized committee’s asset, such as the Committee’s website, to promote the candidate’s book would ordinarily constitute a prohibited personal use. However, the Commission has previously determined that the addition of one or two sentences of promotional material about a candidate’s book to an authorized committee’s website did not constitute personal use of campaign funds, since the amount of promotional material and the cost to the candidate’s committee were de minimis. See AO 2006-07. The Commission concluded in this case that the Committee’s proposal to devote up to 25 percent of the Committee website’s homepage, Facebook page and LinkedIn page to book promotion, and up to 10 percent of the Committee’s Twitter page, is not de minimis. The Committee may, however, consistent with Advisory Opinion 2006-07, post a de minimis amount of material on its own website and social media sites.

Committee email and mailing lists. Senator Brown may personally reimburse the Committee for the fair market value of the rental of its email and mailing lists, based on an independent list appraisal, and then use the email and mailing lists to promote the sale of his book. Commission regulations provide that the transfer of campaign committee assets does not constitute personal use, provided that the transfer is for fair market value. 11 CFR 113.1(g)(3). The Commission has previously determined that a committee’s mailing lists are assets that have value and are frequently sold, rented or exchanged. See, e.g., AOs 2002-14 and 1982-41. Since Senator Brown will receive royalties from the sale of the book, the use of the Committee’s email and mailing lists for promotion of Senator Brown’s book are subject to the personal use regulations. However, since Senator Brown proposes to reimburse the Committee personally for the fair market value of the lists, this will not result in prohibited personal use of campaign funds.

Travel expenses. The Commission could not approve by the required four votes a response to the question of whether Senator Brown may host fundraising events in cities where the book’s publisher pays his travel costs as part of the book’s promotion.

Collection of email addresses by the committee. The Commission could not approve by the required four votes a response to the question of whether the Committee could collect the email addresses of people who attend the Senator’s book-signing and promotional events for the purpose of soliciting contributions in the future.

AO 2011-02: Date Issued: February 17, 2011; Length: 9 pages.