Federal Election Commission Main Page
FEDERAL ELECTION COMMISSION
Washington, DC 20463
November 9, 2006
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
ADVISORY OPINION 2006-30
Jonathan Zucker, Esq.
Senior Strategist and Counsel
ActBlue
P.O. Box 382110
Cambridge, MA 02138
Dear Mr. Zucker:
We are responding to your advisory opinion request on
behalf of ActBlue, concerning the application of the Federal
Election Campaign Act of 1971, as amended (the "Act"), and
Commission regulations to ActBlue's proposal to receive and
forward earmarked contributions to specific individuals who
may become candidates for the 2008 nomination of the
Democratic Party for the office of President of the United
States ("Prospective Candidates"). ActBlue asks whether it
may postpone forwarding those earmarked contributions to the
Prospective Candidates until the Prospective Candidates
register their presidential campaign committees with the
Commission. ActBlue also asks if it may forward
contributions to the Democratic National Committee ("DNC")
if a Prospective Candidate to whom the contributions are
earmarked does not register a presidential campaign
committee by 11:59 p.m. EDT on the seventh day before the
first day of the 2008 Democratic National Convention.
The Commission concludes that ActBlue may solicit and
receive contributions from individuals earmarked for clearly
identified Prospective Candidates. ActBlue must forward all
earmarked contributions to these individuals within ten days
of the date that the candidate registers a presidential
campaign committee with the Commission.
Background
The facts presented in this advisory opinion are based
on your letter received on August 28, 2006, and a September
7, 2006, telephone conversation with you.
ActBlue is a nonconnected political committee that was
formed to promote the election of Democratic candidates for
Federal office and is registered with the Commission.
ActBlue currently serves as a conduit for contributions
earmarked for Democratic candidates and party committees.
See 2 U.S.C. 441a(a)(8); 2 U.S.C. 432(b)(1) and (2); 11 CFR
110.6 and 102.8. ActBlue solicits only on its web site,
www.actblue.com, and accepts contributions made only by
credit card. The recipient candidates and party committees
pay all credit card transaction fees.
ActBlue proposes to solicit and receive earmarked
contributions designated for the primary election campaigns
of Prospective Candidates listed on ActBlue's web site.1
ActBlue would list the names of individuals who ActBlue
considers to be "serious" Prospective Candidates, based on
media reports, pundit lists of possible candidates, and
requests from the public. ActBlue would identify each
contribution as being designated for the primary election of
the Prospective Candidate in its report to the Commission
for the reporting period in which the contribution is
received, in accordance with 11 CFR 110.6(c)(1)(ii).
Although ActBlue would like to begin soliciting and
receiving contributions earmarked for Prospective Candidates
"as soon as possible," ActBlue proposes to postpone
forwarding the earmarked contributions until each
Prospective Candidate registers a presidential campaign
committee with the Commission. At that point, ActBlue would
send a check to the candidate's presidential campaign
committee within ten days for the total amount of the
earmarked contributions that ActBlue has received for that
candidate. If a Prospective Candidate does not register a
presidential campaign committee with the Commission by 11:59
p.m. EDT on the seventh day before the first day of the 2008
Democratic National Convention, then ActBlue proposes to
forward the contributions earmarked for that individual to
the DNC.
ActBlue proposes to provide the recipient presidential
campaign committee, or the DNC, with a report containing all
of the required information with respect to the source of
each earmarked contribution as required in 2 U.S.C.
441a(a)(8) or 2 U.S.C. 432(b)(2) and 11 CFR 110.6(c)(1)(iv)
or 11 CFR 102.8, respectively. ActBlue also proposes to
disclose the forwarded contributions on ActBlue's next
regular report filed with the Commission.
ActBlue's proposed solicitations would inform
prospective contributors that, among other things: 1)
contributions are being "earmarked" within the meaning of
11 CFR 110.6(b)(1); 2) contributions must be within the
amount limitations for contributions to candidates in
accordance with 11 CFR 110.1(b)(1) as indexed for inflation;
3) contributions earmarked to Prospective Candidates will be
forwarded to the DNC under certain circumstances, and the
circumstances under which the forwarding will occur; and 4)
contributions, when aggregated with any other contributions
the individual makes to the Prospective Candidate or the
DNC, must be within the appropriate amount limitations for
contributions in accordance with 11 CFR 110.1 and 110.5.
You state that ActBlue's solicitations would also include
"[a]ll disclaimers required by the Commission's regulations,
including 11 CFR 110.11."
Questions Presented
1. May ActBlue solicit and receive contributions earmarked
for a Prospective Candidate, and then postpone forwarding
the earmarked contributions to the designated candidate
until after the designated candidate registers a
presidential campaign committee with the Commission?
2. If a Prospective Candidate does not register a
presidential campaign committee with the Commission before
11:59 p.m. EDT on the seventh day before the first day of
the 2008 Democratic National Convention, may ActBlue forward
the contributions earmarked for that individual to the DNC?
You then ask, if Questions 1 and 2 are answered in the
affirmative:
3. How must ActBlue report the receipt of the earmarked
contributions?
4. What information should ActBlue provide to
contributors, Prospective Candidates, and the DNC?
Legal Analysis and Conclusions
1. May ActBlue solicit and receive contributions earmarked
for a Prospective Candidate, and then postpone forwarding
the earmarked contributions to the designated candidate
until after the designated candidate registers a
presidential campaign committee with the Commission?
ActBlue may solicit and receive contributions from
individuals earmarked for Prospective Candidates. ActBlue
must forward the earmarked contributions to the candidates
within ten days after the date that the candidate registers
a presidential campaign committee with the Commission
pursuant to 2 USC 433(a) and 11 CFR 102.1(a).
Nonconnected committees may solicit earmarked
contributions from the general public and then forward the
contributions to a Federal candidate. See Advisory Opinion
2003-23 (WE LEAD). Such solicitations, however, must comply
with the source prohibitions and the contribution
limitations in the Act and Commission regulations. For
example, nonconnected committees may not solicit or receive
contributions from foreign nationals, corporations, or labor
organizations. See 2 U.S.C. 441b and 441e; 11 CFR 110.20
and 114.2.
The Act and Commission regulations provide for the
earmarking of contributions "made by a person, either
directly or indirectly, on behalf of a particular
candidate." 2
2 U.S.C. 441a(a)(8) and 11 CFR 110.6. A conduit or
intermediary for earmarked contributions is "any person who
receives and forwards an earmarked contribution to a
candidate or a candidate's authorized committee." 11 CFR
110.6(b)(2). None of the exceptions to this definition
would apply to ActBlue. See 11 CFR 110.6(b)(2)(i) and (ii).
Although the earmarking provisions speak in terms of
contributions made on behalf of a "candidate," Commission
regulations recognize that an individual may receive
contributions before becoming a candidate. In such cases,
when the individual qualifies as a "candidate," the funds
are deemed to have been received by the candidate as an
agent of his or her authorized committee. See 2 U.S.C.
432(e)(2); 11 CFR 101.2(b) and 101.3.
Accordingly, ActBlue may act as a conduit or
intermediary for contributions earmarked for Prospective
Candidates. ActBlue must forward earmarked contributions to
the candidates within ten days of the date that the
candidate registers a presidential campaign committee with
the Commission. See 2 U.S.C. 432(b)(1); 11 CFR
110.6(b)(2)(iii).
The situation presented here does not differ materially
from that presented in Advisory Opinion 2003-23 (WE LEAD).
In that advisory opinion, the Commission determined that the
ten-day forwarding requirement in 2 U.S.C. 432(b)(2) and 11
CFR 102.8(a) did not begin to run for earmarked
contributions collected by WE LEAD, a nonconnected
committee, for the "presumptive nominee" of the Democratic
Party, until DNC certifications showed that a candidate had
secured enough pledged delegates to win nomination on the
first ballot at the 2004 Democratic National Convention. As
the Commission noted, "WE LEAD will not know, and has no way
of knowing, the identity of the Democratic Party's nominee
when it solicits and receives earmarked contributions until
the DNC certifications show that a candidate has become the
party's presumptive nominee." Advisory Opinion 2003-23.
Similarly, here, ActBlue will not know, and will have
no way of knowing, whether a Prospective Candidate will in
fact become a candidate for the office of President of the
United States when it solicits and receives earmarked
solicitations. In Advisory Opinion 2003-23, the recipient's
status (presumptive nominee) was known, but the individual's
name was yet to be determined, while in the instant
situation, the recipient's name is known, but the
recipient's status (candidate for the office of President of
the United States) is yet to be determined. In both cases,
the Commission concludes that the requirement in 2 U.S.C.
432(b) and 11 CFR 102.8(a) that earmarked contributions be
forwarded within ten days of receipt is tolled until both
the recipient's identity and candidacy status are known.
Additionally, both certification by the DNC and registration
with the Commission are easily verifiable acts that do not
require the conduit to make determinations about when a
person technically satisfies the Act's definition of
"candidate."
Upon receiving earmarked contributions from ActBlue, a
candidate must either deposit the contributions or return
them to ActBlue within ten days of receipt. See
11 CFR 103.3(a). If the candidate deposits the
contributions, the candidate must deposit them in an account
maintained by the candidate's presidential campaign
committee. See 2 U.S.C. 432(b)(3); 11 CFR 102.15; 11 CFR
103.3(a). In the event that ActBlue forwards contributions
to a Prospective Candidate before that person registers a
presidential campaign committee with the Commission, both
ActBlue and the Prospective Candidate should recognize that
a Prospective Candidate who receives contributions
aggregating in excess of $5,000 becomes a candidate under
the Act and Commission regulations and must register a
principal campaign committee with the Commission. See 2
U.S.C. 431(2)(A); 11 CFR 100.3(a)(1); 11 CFR 101.1(a); 11
CFR 102.12.
If the Prospective Candidate returns the earmarked
contributions to ActBlue, then ActBlue may either refund the
contributions to the original contributors or forward the
contributions to a political party committee, such as the
DNC (see below). ActBlue may designate a "default
recipient" for the earmarked contributions in the event that
the contributions are returned by one or more of the
Prospective Candidates, subject to the requirements of 11
CFR 102.8. See Advisory Opinion 2003-23 (WE LEAD). ActBlue
must clearly state in its solicitations what it will do with
earmarked contributions that a Prospective Candidate returns
to ActBlue.
2. If a Prospective Candidate does not register a
presidential campaign committee with the Commission before
11:59 p.m. EDT on the seventh day before the first day of
the 2008 Democratic National Convention, may ActBlue forward
the contributions earmarked for that individual to the DNC?
Yes, if a Prospective Candidate does not register a
presidential (principal) campaign committee with the
Commission before 11:59 p.m. EDT on the seventh day before
the first day of the 2008 Democratic National Convention,
ActBlue may forward the contributions earmarked for that
individual to the DNC. In Advisory Opinion 2003-23 (WE
LEAD), the Commission concluded that a nonconnected
committee could forward contributions to the DNC that had
been earmarked to the Democratic Party's "presumptive
nominee" for President, in the event that the "presumptive
nominee" could not be determined by a date certain, subject
to the requirements of 2 U.S.C. 432(b)(2) and 11 CFR
102.8(b). Similarly, here, ActBlue may designate a "default
recipient" for the earmarked contributions in the event that
a Prospective Candidate does not register a presidential
campaign committee with the Commission before the
aforementioned time, subject to the requirements of 11 CFR
102.8. ActBlue must clearly state in its solicitations how
it will distribute the earmarked contributions under such
circumstances.
3. How must ActBlue report the receipt of the earmarked
contributions?3
Contributions earmarked for a candidate through a
conduit or intermediary are contributions from the original
contributor to that candidate, and are reportable as such.
See 2 U.S.C. 441a(a)(8); 11 CFR 110.6(a). If, however, the
conduit or intermediary exercises direction or control over
the choice of the recipient candidate, then the
contributions are treated as contributions from both the
original contributor and from the conduit or intermediary to
the recipient candidate. See 11 CFR 110.6(d).
The collection and forwarding of earmarked
contributions by ActBlue only for those Prospective
Candidates that ActBlue deems to be "serious" would not, by
itself, result in ActBlue exercising direction or control
over an individual's choice about whether to make a
contribution to a specific candidate, because "the
individual contributor, not [ActBlue], makes the choice
whether to make a contribution to the specified candidate."
See Advisory Opinion 1980-46 (National Conservative
Political Action Committee) (a mailing containing a "clear
suggestion that the individual receiving the communication
make a contribution to a specific candidate through [the
PAC] as an intermediary" did not constitute direction or
control by the PAC).
Accordingly, the earmarked contributions would be
contributions from the original contributor to the
Prospective Candidate or DNC. Thus, on its regular report
to the Commission for any reporting period in which it
receives earmarked contributions, ActBlue must report the
original contributions and their sources, and the
Prospective Candidate for whom each contribution is
earmarked. See 2 U.S.C. 441a(a)(8); 11 CFR 110.6(c)(1)(i)
and (ii). On its regular report for any reporting period in
which ActBlue forwards earmarked contributions, ActBlue must
report the disbursement in accordance with 2 U.S.C.
441a(a)(8) and 11 CFR 110.6(c)(1).4
4. What information should ActBlue provide to
contributors, Prospective Candidates, and the DNC?
ActBlue must conform the information that it provides
to potential contributors in its solicitations to the terms
of this advisory opinion. ActBlue would also have to
include in its solicitations the information required in 2
U.S.C. 441d(a)(3) and 11 CFR 110.11(b)(3) and (c)(1). Upon
forwarding each earmarked contribution to a candidate,
ActBlue would have to provide a report to the candidate
containing the contributor's name and mailing address; the
amount of the contribution; the date the contribution was
received by ActBlue; the name of the designated recipient;
the date the contribution was forwarded; and whether the
earmarked contribution was forwarded in cash, by
contributor's check, or by ActBlue's check. See 2 U.S.C.
441a(a)(8); 11 CFR 110.6(c)(iv). For each earmarked
contribution in excess of $200, ActBlue would also have to
provide the contributor's occupation and the name of the
contributor's employer. Id.
In addition, ActBlue would have to provide contributor
information to the DNC when it forwards a contribution to
the DNC in excess of $50.5 See 2 U.S.C. 432(b)(2)(B); 11
CFR 102.8(b)(2). The information would have to include the
name and address of the contributor, and the date of receipt
of the contribution. Id. If the contribution exceeds $200,
then ActBlue would also have to provide the contributor's
occupation and employer. See 11 CFR 102.8(b)(2).
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
Enclosures (Advisory Opinions 2003-23 and 1980-46)
_______________________________
1 ActBlue intends to undertake these activities
independently of any Prospective Candidates or political
committees or agents of either of them.
2 "Earmarked" means a designation, instruction, or
encumbrance, which results in all or any part of a
contribution being made to, or expended on behalf of, a
clearly identified candidate or a candidate's authorized
committee. See 11 CFR 110.6(b)(1).
3 You also ask about the reporting requirements of the
recipient committees. Because ActBlue does not represent
the recipient committees in this request, reporting by those
committees constitutes third party activity, which is not
appropriately addressed in an advisory opinion. See 11 CFR
112.1(b).
4 The Commission considers the fact that ActBlue is a
political committee subject to the reporting requirements of
the Act to be significant to the determinations made in this
advisory opinion.
5 Although not required by the Act or Commission
regulations, ActBlue should consider informing each
contributor of the identity of the actual recipient of the
contributor's funds. For example, if ActBlue forwards a
contribution to the DNC because the candidate for whom the
contribution was earmarked rejected the contribution or the
individual did not register a principal campaign committee
with the Commission before 11:59 p.m. EDT on the seventh day
before the first day of the 2008 Democratic National
Convention, then ActBlue should notify the contributor of
that fact. This information will help contributors keep
track of their contributions for purposes of their bi-annual
contribution limits. Contributions aggregate towards the
contributor's bi-annual limits based on the calendar year in
which they are made, not the calendar year of the election.
See 2 U.S.C. 441a(a)(3); 2 U.S.C. 441a(a)(1)(B); 11 CFR
110.5(c)(1) and 110.1(c)(1). A contribution is "made" when
the contributor relinquishes control of the funds. See 11
CFR 110.1(b)(6).