Notice of proposed rulemaking on use of campaign funds

On July 12, 2007, the Commission approved a Notice of Proposed Rulemaking (NPRM) seeking public comment regarding proposed rules to add two additional permissible uses of campaign funds to the regulations’ current list of permissible uses of such funds. In 2005, Congress amended the provision of the Federal Election Campaign Act (the Act) governing permissible uses of campaign funds, and the NPRM proposes to conform the Commission’s regulations to the Act.

Background

The Act broadly prohibits the personal use of campaign funds and sets forth six specific permissible uses of campaign funds by a federal candidate or officeholder:

• Expenditures in connection with the candidate’s campaign for federal office;
• Ordinary and necessary expenses incurred by a federal officeholder;
• Donations to charity (organizations defined in 26 U.S.C. 170(c));
• Unlimited transfers to a national, state or local political party;
• Donations to nonfederal candidates as permitted by state law; and
• Any other lawful purpose. See 2 U.S.C. §439a(a)(1)-(6).

Congress amended §439a to add the final two permissible uses, donations to nonfederal candidates and “any other lawful purpose,” in the Consolidated Appropriations Act of 2005.

Prior to the passage of the Bipartisan Campaign Reform Act of 2002 (BCRA), the Act permitted candidates and their committees to use their funds for “any other lawful purpose,” as long as that purpose was not personal use of the campaign’s funds by any person. In BCRA, Congress deleted the “any other lawful purpose” language, and the Commission amended its regulations to reflect the change. Now that Congress returned the “any other lawful purpose” language to the Act, the Commission seeks to amend its regulations to re-incorporate the language, as well as to add the rule allowing donations to nonfederal candidates.

Comments

The full text of this NPRM is available in the Federal Register (72 FR 39583) and on the FEC web site at http://www.fec.gov/pdf/nprm/useoffunds/notice_2007-15.pdf.