Federal Election Commission Main Page
FEDERAL ELECTION COMMISSION
Washington, DC 20463
September 5, 2006
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
ADVISORY OPINION 2006-25
Cleta Mitchell, Esq.
Foley & Lardner LLP
Washington Harbour
3000 K St., NW, Suite 500
Washington, DC 20007
Dear Ms. Mitchell:
We are responding to your advisory opinion request on
behalf of United States Senator John L. Kyl and Jon Kyl for
U.S. Senate, his principal campaign committee, concerning
the application of the Federal Election Campaign Act of
1971, as amended (the "Act"), and Commission regulations to
expenditures from personal funds made by another candidate,
Jim Pederson, before the State of Arizona's primary election
and whether such spending triggers the application of the
Millionaires' Amendment for Senator Kyl. The Commission
concludes that Mr. Pederson is not Senator Kyl's "opposing
candidate" in the primary election, so Mr. Pederson's
expenditures from personal funds made before the primary
election will not trigger the Millionaires' Amendment for
Senator Kyl or Jon Kyl for U.S. Senate.
Background
The facts presented in this advisory opinion are based
on your letter received on August 14, 2006.
Senator Jon L. Kyl is seeking reelection to the U.S.
Senate from Arizona, and he is a candidate for the
Republican nomination. Jon Kyl for U.S. Senate is Senator
Kyl's principal campaign committee. Jim Pederson is a
Democratic candidate seeking election to the U.S. Senate
from Arizona. The Republican primary election and the
Democratic primary election will both be held on September
12, 2006, and the general election will be held on November
7, 2006. One Republican candidate and one Democratic
candidate will appear on the September 12 primary ballots
for United States Senator in Arizona.1
To date, Mr. Pederson has filed seven 24-Hour Notices
of Expenditures from the Candidate's Personal Funds (Form
10s) with the Secretary of the Senate and the Commission.
Those notices indicate that Mr. Pederson has made aggregate
expenditures from personal funds of $4,591,098 during the
primary election cycle. You assert that as of June 30,
2006, Mr. Pederson's principal campaign committee had spent
$3,725,000 of Mr. Pederson's personal funds. Of that, you
estimate that at least $1,590,063.36 was spent on opposition
research concerning Senator Kyl and on television, Internet,
and radio advertisements criticizing Senator Kyl. You do
not indicate how much Senator Kyl has spent on opposition
research concerning Mr. Pederson or on television, Internet,
and radio advertisements criticizing Mr. Pederson.
Senator Kyl and Jon Kyl for U.S. Senate intend to raise
funds under the increased individual contribution limits
provided by the Millionaires' Amendment,2 should the
Commission determine that Mr. Pederson's expenditures from
personal funds made before the primary election trigger the
application of the Millionaires' Amendment for Senator Kyl.
Question Presented
May Senator Kyl consider any of Mr. Pederson's expenditures
from personal funds made before the primary election to be
in connection with the general election?
Legal Analysis and Conclusions
No, Mr. Pederson's expenditures from personal funds
made before the primary election will be expenditures from
personal funds made in connection with the primary election
only, and will not trigger application of the Millionaires'
Amendment for Senator Kyl because Mr. Pederson is not
Senator Kyl's "opposing candidate" in the primary election.
The Millionaires' Amendment mandates that its increased
individual contribution limits and coordinated party
expenditure limits shall apply separately to primary and
general elections. See 2 U.S.C. 431(25) ("[A] primary
election and a general election shall be considered to be
separate elections"); see also 11 CFR 400.2(b). An
"election cycle" is defined as the period beginning on the
day after the date of the most recent election for the
specific office or seat that a candidate is seeking and
ending on the date of the next election for that office or
seat. See 2 U.S.C 431(25); 11 CFR 400.2; Increased
Contribution and Coordinated Party Expenditure Limits for
Candidates Opposing Self-Financed Candidates; Interim Final
Rule, 68 Fed. Reg. 3970, 3975 (Jan. 27, 2003).3
These provisions of the Millionaires' Amendment are
triggered by expenditures from personal funds4 made by an
"opposing candidate." See 2 U.S.C. 441a(i)(1)(C) and (D);
see also 68 Fed. Reg. at 3976. Although the Act does not
define the phrase "opposing candidate," Commission
regulations define "opposing candidate" separately for
primary election cycles and general election cycles,
consistent with the Act's application of the Millionaires'
Amendment separately to the primary and general election
cycles. See 2 U.S.C. 431(25); 11 CFR 400.2 and 400.3.5 In
a primary election cycle, an "opposing candidate" is
"another candidate seeking the nomination of the same
political party for election to the office of Senator . . .
that the candidate is seeking." 11 CFR 400.3(a). See also
68 Fed. Reg. at 3976. With situations like the one
presented in this advisory opinion in mind, the Commission
specifically sought comment when it promulgated the Interim
Final Rule on whether it should define "opposing candidate"
at 11 CFR 400.3(a) "to include candidates seeking another
political party's nomination for the same office." Id.
(emphasis in original). The Commission noted that this
approach would constitute an "expanded definition" of the
term "opposing candidate." Id. No changes to 11 CFR
400.3(a) have been promulgated after the Interim Final Rule
became effective. Thus, the Commission's current rule does
not permit the interpretation of "opposing candidate" that
Senator Kyl and Jon Kyl for U.S. Senate propose. See
Advisory Opinions 2006-21 (Cantwell) and 2006-6 (Busby).
Accordingly, only expenditures from personal funds made by
an opposing candidate running in the same primary, and made
during that primary election cycle, affect the application
of the Millionaires' Amendment during that primary election
cycle. See id. This classification of expenditures as
being in connection with either the primary election or the
general election based on the date the expenditures are made
is similar to the Commission's longstanding approach in
determining whether Presidential candidate expenditures are
attributed to the primary or general election. See 11 CFR
9034.4(e).
Because Mr. Pederson is not "another candidate seeking
the nomination of the same political party" as Senator Kyl,
Mr. Pederson is not Senator Kyl's "opposing candidate" in
the primary election. 11 CFR 400.3(a) (emphasis added).
Thus, Mr. Pederson's expenditures from personal funds made
before the primary election will not trigger the
Millionaires' Amendment for Senator Kyl. Whether Mr.
Pederson has any primary opposition6 and the purpose of his
expenditures from personal funds do not change this result.7
Similarly, Senator Kyl's expenditures from personal funds
made before the primary will trigger the Millionaires'
Amendment for his opponent in the Republican primary, but
not for Mr. Pederson who is running in a different primary.
Accordingly, for purposes of increased contribution limits
and increased coordinated party expenditure limits, Senator
Kyl must consider only expenditures from personal funds made
by his opposing candidate for the Republican nomination
during the primary election cycle.8
This response constitutes an advisory opinion
concerning the application of the Act and Commission
regulations to the specific transaction or activity set
forth in your request. See 2 U.S.C. 437f. The Commission
emphasizes that, if there is a change in any of the facts or
assumptions presented, and such facts or assumptions are
material to a conclusion presented in this advisory opinion,
then the requestor may not rely on that conclusion as
support for its proposed activity.
Sincerely,
(signed)
Michael E. Toner
Chairman
Enclosure (Advisory Opinions 2006-21 and 2006-6)
_______________________________
1 See Arizona Secretary of State, 2006 Primary Election,
Full Listing, http://www.azsos.gov/election/2006/
Primary/FullListing.htm (last visited Aug. 17, 2006). An
additional candidate for the Republican nomination will have
his name posted in the polling places as a write-in
candidate, and write-in votes for this candidate will be
counted. Id., see also Ariz. Rev. Stat. 16-312(C) (2006).
2 The Act, as amended by the Bipartisan Campaign Reform Act
of 2002, Pub. L. No. 107-155, 116 Stat. 81 (2002), contains
a set of provisions collectively referred to as the
"Millionaires' Amendment." See 2 U.S.C. 441a(i) and 441a-1.
Under the Millionaires' Amendment, a candidates may solicit,
receive, and spend contributions from individuals under
increased contribution limits if the candidate is running
against self-financed opponent who makes "expenditures from
[his or her] personal funds" that exceed certain amounts.
See 2 U.S.C. 441a(i)(1)(A)-(C) and 11 CFR 400.40(b).
Additionally, national and State party committees may make
coordinated party expenditures in excess of the normally
applicable coordinated party expenditure limit, in 2 U.S.C.
441a(d), on behalf of candidates opposing self-financed
candidates. See 2 U.S.C. 441a(i)(1)(C)(iii)(III) and 11 CFR
400.40(b)(3). The Millionaires' Amendment also requires
that candidates and/or their principal campaign committees
comply with a number of specific reporting and notification
requirements. See, e.g., 2 U.S.C. 434(a)(6)(B) and 11 CFR
400.20, 400.21, 400.22, and 400.30(b)(2).
3 The primary election cycle began on November 8, 2000, the
day after the last general election, and will end on
September 12, 2006, the date of the primary election. The
general election cycle will begin on September 13, 2006, the
day after the primary election, and will end on November 7,
2006, the date of the general election.
4 An "expenditure from personal funds" means the
aggregation of all of the following: (1) an expenditure
made by the candidate using the candidate's personal funds;
(2) a contribution or loan made by the candidate to the
candidate's authorized committee using the candidate's
personal funds; (3) a loan to the candidate's authorized
committee that is secured using the candidate's personal
funds; and (4) any obligation to make an expenditure from
personal funds that is legally enforceable against the
candidate. See 2 U.S.C. 434(a)(6)(B)(i); 11 CFR 400.4; 68
Fed. Reg. at 3976.
5 The Commission defined "opposing candidate" separately
for each election cycle because the operative provisions of
the Millionaires' Amendment are triggered by expenditure of
personal funds by "an opposing candidate," 2 U.S.C.
441a(i)(1)(D), and these operative provisions apply only
with respect to a particular election cycle. See Increased
Contribution and Coordinated Party Expenditure Limits for
Candidates Opposing Self-Financed Candidates; Interim Final
Rule, 68 Fed. Reg. 3970, 3976 (Jan. 27, 2003); see also 2
U.S.C. 441a(i)(1)(D)(ii) (opposition personal funds amount
considers "gross receipts of a candidate's authorized
committee during any election cycle"); 2 U.S.C.
441a(i)(1)(B) (threshold amount determined "with respect to
an election cycle").
6 Under the Commission's regulations, an election in which
a candidate is unopposed is treated as a separate election
for purposes of the contribution limits. See 11 CFR
110.1(j)(2).
7 Your request cites 11 CFR 102.9(e) for the proposition
that Mr. Pederson should be required to characterize some
portion of his expenditures from personal funds made before
the primary election as expenditures made in connection with
the general election. However, section 102.9(e) applies not
to expenditures made by a committee prior to the primary
election but, rather, to contributions designated for the
general election received prior to the primary election.
See 11 CFR 102.9(e).
8 If either Mr. Pederson or Senator Kyl transfers any cash-
on-hand to the general election campaign, however, he must
use a reasonable accounting method, such as the accounting
method in 11 CFR 110.3(c)(4), to determine the amount, if
any, of his personal funds transferred from the primary
election campaign to the general election campaign. See
Advisory Opinions 2006-21 (Cantwell) and 2006-6 (Busby).
Any amount of a candidate's personal funds transferred to
the general election campaign will be used to determine if
increased contribution limits and coordinated party
expenditure limits apply for the candidate's general
election opponent. See id.