Federal Election Commission Main Page
May 21, 1990
CERTIFIED MAIL
RETURN RECEIPT REQUESTED
ADVISORY OPINION 1990-6
Margaret D. Kirkpatrick
Stoel, Rives, Boley, Jones & Grey
Standard Insurance Center
900 S.W. Fifth Avenue
Suite 2300
Portland, Oregon 97204-1266
Dear Ms. Kirkpatrick:
This responds to your letter dated March 30, 1990, requesting an
advisory opinion on behalf of Pacific Power & Light ("PP&L")
concerning application of the Federal Election Campaign Act of 1971,
as amended ("the Act"), and Commission regulations to an Oregon
statute that may prohibit corporate charitable donations which match
political contributions from its employees.
You state that PP&L has established a separate segregated fund for
its employees to raise money for use in Federal elections. The
company also has a separate committee for contributing to State
elections. PP&L wishes to implement a solicitation plan for the
Federal committee only to be known as the Pacific Power Community
Charitable Contribution Plan ("the Plan"). Under the Plan, the
company will allow each contributor to the Federal committee to choose
a 501(c)(3) qualified charity1/ as the recipient of a donation from
PP&L equal to that person's contribution to the committee.
You refer to section 260.665 of the Oregon Revised Statutes as the
State law applicable to the Plan. It provides in pertinent part:
(2) No person, acting either alone or
with or through any other person, shall
directly or indirectly subject any person to
undue influence with the intent to induce
any person to:
....
(e) Contribute or refrain from
----------
1/ See 26 U.S.C. Sc501(c)(3) (Internal Revenue Code).
contributing to any candidate, political
party or political committee.
ORS 260.665(2)(e). According to Oregon law, "undue influence"
includes "giving or promising to give money, employment or other thing
of value." ORS 260.665(1).
You have enclosed a letter, sent to PP&L by the Director of the
Elections Division of the Office of the Secretary of State of Oregon,
which indicates that PP&L's donation to a charity would be a thing of
value to the employee and could induce the employee to contribute.
You note that neither the language of ORS 260.665 nor the
determination of the Elections Division limits that section to State
and local elections. You ask whether Federal law preempts the Oregon
statute with respect to a political committee that is active only in
Federal elections.
You state that the charitable matching plan proposed by PP&L is
similar to several plans approved by the Commission in recent advisory
opinions, citing Advisory Opinions 1989-9, 1989-7, 1988-48, 1987-18,
and 1986-44. In those opinions, the Commission has treated the
matching charitable donations by a corporation as an expense of
soliciting contributions to the company's separate segregated fund
and, therefore, as exempt from the definition of "contribution or
expenditure." 2 U.S.C. Sc441b(a) and Sc441b(b)(2)(C). The Commission
has further explained that the regulations forbid a corporation to use
this process "as a means of exchanging treasury monies for voluntary
contributions." 11 CFR 114.5(b). The Commission noted, in that
respect, that a contributor could not be paid for his or her
contribution through a bonus, expense account, or other form of direct
or indirect compensation. 11 CFR 114.5(b)(1). The Commission
concluded that, because the contributors to the plans would not
receive a financial, tax, or other tangible benefit from either the
company or the recipient charities, it did not appear that an exchange
of treasury monies for voluntary contributions would occur.2/
Preemption of state laws pertaining to the conduct of Federal
elections is addressed directly in the Act and its legislative
history, and in Commission regulations. The Act provides that its
provisions and the rules prescribed thereunder, "supersede and preempt
any provision of State law with respect to election to Federal
office." 2 U.S.C. Sc453. The House committee that drafted this
provision intended "to make certain that the Federal law is construed
to occupy the field with respect to elections to Federal office and
that the Federal law will be the sole authority under which such
----------
2/ The Commission approved the plans subject to the
conditions that only employees solicitable for contributions
to the separate segregated fund could participate and that
the solicitations met the requirements of a proper
solicitation. 2 U.S.C. Sc441b(b)(4)(A)(i); 11 CFR 114.5(g)(1
and 114.5(a).
elections will be regulated." H.R. Rep. No. 93-1239, 93d Cong., 2d
Sess. 10 (1974). According to the Conference Committee report on the
1974 Amendments to the Act, "Federal law occupies the field with
respect to criminal sanctions relating to limitations on campaign
expenditures, the sources of campaign funds used in Federal races, the
conduct of Federal campaigns, and similar offenses, but does not
affect the States' rights" as to other areas such as voter fraud and
ballot theft. H.R. Rep. No. 93-1438, 93d Cong., 2d Sess. 69 (1974).
When the Commission promulgated a regulation at 11 CFR 108.7 on
the effect of the Act on state law, it stated that the regulation
follows section 453 and that, specifically, Federal law supersedes
state law with respect to the organization and registration of
political committees supporting Federal candidates, disclosure of
receipts and expenditures by Federal candidates and committees, and
the limitation on contributions and expenditures regarding Federal
candidates and political committees. The Commission stated that the
Act does not supersede state laws concerning the manner of
qualification of candidates, dates and places of elections, voter
registration, voting fraud, or candidates' personal financial
disclosure. The Commission explained that "[t]hese types of electoral
matters are interests of the states and are not covered in the act."
Federal Election Commission Regulations, Explanation and
Justification, House Document No. 95-44, p. 51. See 11 CFR 108.7.
As demonstrated in the advisory opinions cited above, the legality
of PP&L's proposed conduct depends upon analysis as to what
constitutes a corporate contribution or expenditure and as to the
solicitation and acceptance of contributions for use in Federal
election activity. Since Federal law occupies the field with respect
to limitations and prohibitions of Federal campaign contributions and
expenditures, and the sources of funds used in Federal campaigns, the
Commission concludes that the Act preempts any State law, or the
interpretation of such law, prohibiting the use of a charitable
matching plan by a political committee to raise funds for use in
Federal elections only. See Advisory Opinion 1982-29. Therefore, if
the Plan meets the conditions set out in the Commission advisory
opinions permitting such plans, it may be implemented, notwithstanding
the cited State law of Oregon or an interpretation of that law.
This response constitutes an advisory opinion concerning
application of the Act or regulations prescribed by the Commission to
the specific transaction or activity set forth in your request. See 2
U.S.C. Sc437f.
Sincerely,
(signed)
Lee Ann Elliott
Chairman for the
Federal Election Commission
Enclosures (AOs 1989-9, 1989-7, 1988-48, 1987-18, 1986-44,
and 1982-29)