Federal Election Commission Main Page
Washington, DC 20463
CERTIFIED MAIL September 12, 1996
RETURN RECEIPT REQUESTED
ADVISORY OPINION 1996-25
David Frulla
Brand, Lowell & Ryan P.C.
923 Fifteenth Street, N.W.
Washington, D.C. 20005
Dear Mr. Frulla:
This refers to your letters dated August 15, May 24 and May
10, 1996, which request advice concerning application of the
Federal Election Campaign Act of 1971, as amended ("the Act"),
and Commission regulations to the voluntary check-off program
maintained by Seafarers Political Activity Donation ("SPAD").
You ask about the application of the Commission's recently
amended "best efforts" regulation to SPAD's check-off program and
SPAD's obligation to identify the employers of SPAD's union
member contributors.
FACTUAL BACKGROUND
SPAD is the separate segregated fund of the Seafarers
International Union ("SIU") which represents merchant seamen and
boatmen ("seamen") aboard U.S.-flag vessels on the high seas, the
Gulf of Mexico, and inland lakes and waterways. Almost all of
these seamen are employed through what is known as "rotary"
crewing. This consists of SIU regional hiring halls referring
union members for periodic employment with SIU-contracted
companies.1 Once referred, an individual merchant seaman will
generally work for a shipping company employer only for the
duration of a trip at sea. A trip lasts only a few months and,
often times, they are even shorter. You state that, after the
trip concludes, the SIU member returns to the "beach" and places
his or her name on the hiring hall's list of individuals waiting
to ship. The union member then returns to work some time later,
most often for a different employer, once he or she has reached
the top of the hiring list.
You point out that the periodic and ever-changing nature of
maritime employment precludes SPAD from using a conventional,
labor organization separate segregated fund check-off program.
To deal with the circumstances of the rotary crewing, SPAD's
check-off contributions are remitted from a participating
member's share of the SIU's employer-funded vacation plan, and
not from individual SIU-contracted employers.2 SPAD solicits a
member to voluntarily check off a portion (usually fifty cents)
of each day of employment for which he or she applies for
vacation pay. You explain that this approach surmounts the
logistical barriers preventing SPAD from maintaining a check-off
arrangement with individual SIU- contracted employers.3
In SPAD's request, you offer several different alternative
proposals to satisfy SPAD's obligation to make best efforts in
obtaining contributor information. You state that SPAD's
solicitations ask each participating SIU member to provide his or
her name or address. You add that contributors willingly provide
this information and SIU's vacation plan has this information on
file. SPAD also obviously knows the occupations of its
contributors who participate in the SIU's vacation plan check-
off. They are all merchant mariners. The above information is
therefore easily disclosed in SPAD's reports filed with the
Commission. However, due to the nature of the rotary crewing
system described above, you state that SPAD does not ask a
participating SIU member to identify his or her employer on its
check-off authorization form. Currently, SPAD does not
independently seek this information from a member whose annual
contributions exceeds $200. You note that at the time a
contribution is obtained through the check-off program, the
contributor is between assignments and is not working for any
employer. Because of the above circumstances, you ask that the
Commission conclude that SPAD's seeking the contributor's name,
address and occupation but not seeking the contributor's employer
meets its "best efforts" requirement as set forth in Commission
regulations. In the event that SPAD must complete the employer
box of its FECA disclosure forms, you propose that SPAD be
permitted to report that the contributor is employed by "various
U.S.-flag vessel operators."4 As another alternative, SPAD
offers to include in the Seafarers vacation pay application form
a request for information regarding the current employment of the
member wishing to contribute. 5 You state that the results of
this inquiry would then be reported in SPAD's FEC disclosure
reports.
THE ACT AND COMMISSION REGULATIONS
When the treasurer of a political committee shows that best
efforts have been used to obtain, maintain, and submit the
information required by the Act for the political committee, any
report or any records of such committee are considered in
compliance with the Act. 2 U.S.C. 432(i) and 11 CFR 104.7(a).
The identification of individual contributors required by the Act
for individuals whose contribution(s) aggregate in excess of $200
in a calendar year requires providing the individual's full name,
mailing address, occupation and the name of the contributor's
employer. 2 U.S.C. 431(13) and 11 CFR 100.12.
The treasurer will be deemed to have exercised best efforts
to obtain the information for this identification if all written
solicitations include a clear request for the contributor's full
name, mailing address, occupation and the name of employer. 11
CFR 104.7(b)(1) and (2). The treasurer of a political committee
must report all contributor information not provided by the
contributor, but in the political committee's possession,
regarding contributor identification. This includes information
in a committee's contributor records, fundraising records and
previously filed reports, in the same two-year election cycle in
accordance with 11 CFR 104.3. 11 CFR 104.7(b)(3).
The Supreme Court has held that the disclosure of each large
contributor's name and address as well as the donor's occupation
and principal place of business serves informational functions,
as well as the prevention of corruption and the enforcement of
the contribution limitations. Buckley v. Valeo, 424 U.S. 1
(1976). The Commission's "best efforts" regulation, cited above,
is designed to "promote the very gathering of information that
Buckley found to be in the public interest." Republican National
Committee v. Federal Election Commission ("RNC"), 76 F.3d 400,
408 (D.C. Cir. 1996), petition for cert filed (U.S. Sept. 9,
1996) (No. 96-____).6
BEST EFFORTS AND SPAD
The Commission notes that it has concluded that a vacation
fund administered by a labor organization is a permissible source
of voluntary contributions to a separate segregated fund using a
deduction authorization plan. See Advisory Opinions 1980-74,
1980-69 and 1979-60. However, your proposal to provide no
information regarding your contributors' employers would not meet
the disclosure needs of the Act. Therefore, the Commission
concludes that declining to disclose any employer name for
contributors whose contributions exceed $200 in a calendar year
would not fulfill SPAD's "best efforts" obligations as set out in
11 CFR 104.7(b)(1) and (2). However, SPAD's proposals taken
together would meet the requirements of the regulations.
At the time a written solicitation is made, SPAD is required
by 11 CFR 104.7(b)(1) to request information from a contributor
regarding the contributor's employment. The sample inquiry you
propose to place in the Seafarers vacation pay application form
(see footnote 5) would fulfill that obligation, insofar as the
application is used as a means to solicit contributions.7 If a
contributor provides information that he or she is currently
employed, SPAD is required to include that information in its
identification of the contributors in its FEC reports.8 If a
contributor states that he or she is unemployed, SPAD's
alternative to report that a contributor is employed by "various
U.S.-flag vessel operators," would be a sufficient identification
of employment status. Again, as your request indicates, because
of the nature of the hiring hall system for making employment
assignments, to list the contributor as simply "unemployed" would
be somewhat inaccurate.
The Commission concludes that SPAD is required, as any other
political committee, to follow the other remaining procedures of
11 CFR 104.7(b)(1),(2) and (3). Should a contributor fail to
provide SPAD with its current or most recent employer (for
example, fails to complete the vacation pay application form with
the requested information) after the initial inquiry made under
section 104.7(b)(1), SPAD must make a follow up inquiry under
section 104.7(b)(2).9
This response constitutes an advisory opinion concerning the
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. 437f.
Sincerely,
(signed)
Lee Ann Elliott
Chairman
Enclosure (AO 1996-1, 1980-74, 1980-69, 1979-60)
_______________________________
1 You state that there are approximately one hundred companies
that have contracted with SIU to obtain the referral of SIU
members for employment.
2 You state that pursuant to its collective bargaining agreement
with SIU, an employer must make a payment to the SIU vacation
plan on behalf of each SIU member that it has employed. An
employers' vacation plan payment for an individual union member
corresponds to the length of his or her employment with that
company. Provided other eligibility criteria are met, an SIU
member may request vacation pay at the conclusion of his or her
trip at sea, whereupon the SIU vacation plan will issue the
member one lump sum check comprising all the vacation pay to
which the member is entitled. You explain that a member must
accrue 120 days of employment before becoming eligible to receive
payment and any additional payment must follow another 120 days
of employment. The administration of the plan is kept
technically separate from SIU. However, it is administered by a
board of trustees comprised in equal part of management and union
representatives.
3 The request includes a copy of the Seafarers vacation pay
application form. The form contains a general authorization that
is signed by a member to deduct the amounts which will be the
contribution(s) to SPAD. You state in your request that the
authorization is effective until it is revoked by the member.
This could be done, however, when a member fills out a new
application for vacation pay following another 120 day period of
employment.
4 In the most recent report filed with the Commission, for each
contributor SPAD indicated that the name of the contributor's
employers is "not available."
5 The request would be worded as follows:
Are you currently sailing or assigned to a vessel on
the date of this application? CHECK ONE:
____ No, I am "on the beach."
____ Yes, I am currently working for ___________.
6 Congress noted the importance of a best efforts test: The 1979
report from the Committee on House Administration that
accompanied the 1979 amendments to the Act noted that " [t]he
best efforts test is crucial since contribution information is
voluntarily supplied by persons who are not under the control of
the committee." H.Rep. No. 96-422, 96th Cong., 1st Sess. 14
(1979).
7 The facts of your opinion indicate that this application form
is the primary method by which SPAD solicits contributions.
However, amending the Seafarers vacation pay application form
does not, of course, relieve SPAD of its obligations under
section 104.7 to inquire regarding the employment of a
contributor in any other written solicitation it adopts or uses.
8 The Commission recognizes that a connected organization--
whether a corporation, membership organization, trade
association, labor organization, or cooperative-- establishes,
administers or financially supports its separate segregated fund.
See 2 U.S.C. 431(7), 441b(b)(2)(C) and 11 CFR 100.6.
Commission regulations assume that a labor organization has
control of its separate segregated fund. 11 CFR 114.5(d) and
Advisory Opinion 1996-1. See Pipefitters Local Union No. 562 v.
United States, 407 U.S. 385, 426 (1972). (The Court concluded
"it is difficult to conceive how a valid political fund can be
meaningfully `separate' from the sponsoring union in any way
other than `segregated.' ")
It is presumed that, as a result of this relationship,
certain types of separate segregated funds (such as SPAD) will
have access to information about their contributors (for example,
union members) who stand in a special relationship to the
connected organization. The Commission acknowledges, however,
that other types of separate segregated funds, such as those
sponsored by membership organizations, trade associations and
cooperatives, may not have the same access to contributor
information as labor organizations and corporations with capital
stock. Instead, their situation is more similar to that of party
committees, authorized committees and nonconnected committees
with regard to the contributor information they have available.
9 The other requirements, as set out in section 104.7(b)(2) and
in accord with RNC, are that the inquiry may be either written or
oral (documented by a committee writing), that the inquiry be
made no later than thirty (30) days after the receipt of the
contribution, that the request not include any other material or
solicitation, but it may thank the contributor for the previous
contribution(s). A written request should be accompanied by a
pre-addressed return post card or envelope. 11 CFR 104.7(b)(2).