Chapter 5: Public Funds - Campaign Finance Law - New York City Campaign Finance Board

Chapter 5: Public Funds

Rule 5-01 Payment Procedure
    (a) (1) Board determines eligibility
         (2) Public funds cap
         (3) Small primaries
         (4) Non-competitive campaigns
         (5) Bonus determinations
    (b) Preliminary review of disclosure statements
    (c) Basis for payments
    (d) Validity of matchable contribution claims and projected rate of invalid claims
    (e) Withholding of public funds
    (f) Basis for ineligibility determination
    (g) Payment is not final determination
    (h) Notice to participants
    (i) Pre-election payments
    (j) Flat grants in special circumstances
    (k) Post-payment audits
    (l) Characterization of payments as for the primary or general election
    (m) Post-election payments
    (n) Deductions from payments
    (o) Use of final payment
    (p) Responding to invalid matching claims reports
    (q) Ballot disqualification by Board of Elections; candidate not opposed on the ballot
    (r) Reduction in maximum public funds payable
    (s) Approval by Board subject to correction of limited, isolated, and easily corrected compliance issues
    (t) Payment of expenditures made in connection with litigation with public funds
    (u) Payment by electronic funds transfer

Rule 5-02 Review of Eligibility, Payment, and Repayment Determinations
(a) Written petitions for review
(b) Final disqualification from the ballot

Rule 5-03 Repaying Public Funds
    (a) Participants returning public funds
    (b) Participant is disqualified from the ballot
    (c) Excess public fund payments
    (d) Improper use of public funds
    (e) Unspent campaign funds
    (f) Other reasons for repayment
    (g) Repayment determinations

Rule 5-04 Fund Administration

Campaign Finance Board Rules Table of Contents

Rule 5-01 Payment Procedure.

(a) (1) Board determines eligibility. No payments from the Fund shall be made to a participant unless the Board has determined that a candidate has met all eligibility requirements of the Act and these rules. The Board shall notify the participant of a determination of ineligibility.

(2) Public funds cap. (i) The Board shall determine, pursuant to §3-705(7)(a) of the Code, whether a participant is opposed by another candidate who has spent or contracted or obligated to spend, or received in loans or contributions, or both, an amount which in the aggregate exceeds one-fifth of the expenditure limit applicable to the participant. Such determination shall be made pursuant to Rule 7-03.

(ii) Participants seeking additional public funds pursuant to §3-705(7)(b) of the Code must file a signed statement with the Board pursuant to §3-705(7)(b) no later than the due date for the disclosure statement immediately preceding the public funds payment for which the participant is seeking to receive the additional public funds; provided, however, that participants seeking to receive the additional public funds on the first date payments are made by the Board for a primary election, must file the signed statement with the Board no later than the day before the first date the Board of Elections conducts hearings on any ballot petition filed by any candidate seeking nomination for election in any primary occurring in the same election cycle for which the candidate is seeking nomination for election, without regard to whether such hearings are related to a petition filed by an opponent of the participant.

(3) Small primaries. (i) A participant on the ballot in one or more primary election(s) in which the number of persons eligible to vote for party nominees in each such election totals fewer than one thousand shall not receive public funds in excess of five thousand dollars for qualified campaign expenditures in such election or elections; provided, however, that the foregoing limitation shall not apply to such participant if he or she is opposed in a primary election by (A) a participant who is not subject to such limitation or (B) a limited participant or non-participant who has spent or contracted or obligated to spend in excess of ten thousand dollars for such primary election. The Board shall determine whether a non-participant has exceeded such ten thousand dollar level pursuant to Rule 7-03.

(ii) For the purposes of subparagraph (i), the number of persons eligible to vote for party nominees in a primary election shall be as determined by the Board of Elections for the calendar year of the primary election pursuant to §5-604 of the New York Election Law. If such determination for any primary election is not available from the Board of Elections as of the day before the due date for filing a certification pursuant to §3-703(1)(c) of the Code, the most recent determination by the Board of Elections of the persons eligible to vote for party nominees for the office for which such primary election is held shall be relied upon.

(4) Non-competitive campaigns. (i) Pursuant to §3-705(9) of the Code, a participating candidate who endorses or otherwise publicly supports his or her opponent for election shall not be eligible for public funds.

(ii) Pursuant to §3-705(10) of the Code, a participating candidate who loses the primary election but remains on the ballot for the general election shall be ineligible to receive public funds unless the candidate certifies to the Board that he or she will actively campaign for office, by measures including but not limited to raising and spending funds, seeking endorsements, and broadly soliciting votes.

(5) Bonus determinations. (i) Pursuant to §3-706(3)(a) of the Code, where the Board has determined that a non-participating candidate has spent or contracted or has obligated to spend, or received in loans or contributions, or both, an amount which, in the aggregate, exceeds half the applicable expenditure limit pursuant to §3-706(1)(a) of the Code, then:

(ii) such expenditure limit applicable to participating candidates and limited participating candidates in such election for such office shall be increased to one hundred fifty percent of such limit; and

(iii) the principal committees of such participating candidates shall receive payment for qualified campaign expenditures of approximately seven dollars and fourteen cents for each dollar of matchable contributions, up to one thousand two hundred fifty dollars in public funds per contributor (or approximately $7.18 for each dollar of matchable contributions, up to six hundred twenty-five dollars in public funds per contributor in the case of a special election); provided, however, that (A) participating candidates in a run off election shall receive public funds for such election pursuant to subdivision five of section 3-705 and shall not receive any additional public funds pursuant to this section, and (B) in no case shall a principal committee receive in public funds an amount exceeding two-thirds of the expenditure limitation provided for such office in §3-706(1)(a) of the Code.

(iv) Pursuant to §3-706(3)(b) of the Code, where the Board has determined that a non-participating candidate has spent or contracted or has obligated to spend, or received in loans or contributions, or both, an amount which, in the aggregate, exceeds three times the applicable expenditure limit pursuant to §3-706(1)(b) of the Code, then:

(v) such expenditure limit shall no longer apply to participating candidates and limited participating candidates in such election for such office; and

(vi) the principal committees of such participating candidates shall receive payment for qualified campaign expenditures of approximately eight dollars and fifty-seven cents for each dollar of matchable contributions, up to one thousand five hundred dollars in public funds per contributor (or approximately $8.62 for each dollar of matchable contributions, up to seven hundred fifty dollars in public funds per contributor in the case of a special election); provided, however, that (A) participating candidates in a run off election shall receive public funds for such election pursuant to subdivision five of section 3-705 and shall not receive any additional public funds pursuant to this section, and (B) in no case shall a principal committee receive in public funds an amount exceeding one hundred twenty-five percent of the expenditure limitation provided for such office in §3-706(1)(a) of the Code.

(b) Preliminary review of disclosure statements. (i) In order to make possible payment within four business days after receipt of disclosure statements, or as soon thereafter as is practicable, pursuant to §3-705(4) of the Code, the Board shall conduct a preliminary review of all disclosure statements filed and all receipts filed indicating proof of compliance with §12-110 of the Code. This preliminary review may be delayed if the participant fails to submit a disclosure statement, a receipt indicating compliance with §12-110 of the Code or information requested by the Board, or fails to submit a disclosure statement, a receipt indicating compliance with §12-110 of the Code or information requested by the Board by the date required by the Board, or submits a disclosure statement that fails to comply substantially with the requirements of the Act or these rules. A preliminary review may also be delayed for other reasons, including, but not limited to, consideration of whether a basis exists for an ineligibility determination, as described in subdivision (f). A delayed preliminary review may result in a delay in a payment determination, until such time as it is practicable and the Board is considering making payments based on matchable contributions claimed in disclosure statements actually received on or before a subsequent applicable due date.

(ii) After a participant has been informed that a matchable contribution claim has been deemed invalid or that the participant is ineligible for public funds, the participant shall not include in any petition or request to the Board any documentation or factual information not submitted to the Board prior to the determination under review unless the participating candidate can demonstrate good cause for the previous failure to submit such documentation or information and for any failures to communicate on a timely basis with the Board.

(c) Basis for payments. The amount paid to a participant shall be based upon the Board’s review and audit of matchable contributions claimed and qualified campaign expenditures.

(d) Validity of matchable contribution claims and projected rate of invalid claims. The Board shall not make payment for any matchable contribution claim it determines or projects to be invalid. The Board shall consider the following factors in determining that matchable contribution claims are invalid and in projecting a rate of invalid matchable contribution claims:

(1) cash contributions from any one contributor that are greater than $100 in the aggregate, in violation of New York Election Law §14-118(2), or money order contributions from any one contributor that are greater than $100 in the aggregate;

(2) contributors who are individuals under the age of eighteen years or that are entities other than individuals;

(3) matchable contribution claims that would yield more than $1,050 in public funds per contributor (or $522 in the case of a special election);

(4) contributions that exceed the contribution limit applicable under the Act;

(5) contributor addresses that are not residential addresses within New York City;

(6) contributions for which information is omitted from or illegible in a disclosure statement;

(7) contributions made later than December 31 of the election year;

(8) contributions originally received for elections other than the election in which the candidate is currently a participant, as described in Rule 1-07;

(9) matchable contribution claims that exceed the gross amount of the contribution;

(10) contributions that were not received within the reporting period or that were made by post-dated check;

(11) (i) contributions totaling more than $99 for which a participant has not reported the contributor’s occupation, employer, and business address; (ii) contributions totaling less than $99 for which a participant is required to report the contributor’s occupation, employer, and business address, pursuant to Rule 3-03(c)(6)(ii), but has failed to do so;

(12) contributions that were returned to or not paid by the contributor;

(13) checks drawn by a person other than the contributor except checks signed by a contributor’s authorized agent where the documentation required under Rule 4-01(b)(2) has been maintained and provided;

(14) contributions that are otherwise not matchable contributions within the meaning of the Act;

(15) any information that suggests that a contribution has not been processed or reported in accordance with Program requirements;

(16) any other information that suggests that matchable contribution claims may be invalid;

(17) contributions for which a record required under Chapter 4 was not kept or provided upon request;

(18) contributions for which complete supporting documentation required by Rule 3-04(a) has not been submitted;

(19) check or money order contributions made payable to entities other than the committee that has reported receiving the contribution;

(20) contributions that were made or accepted in violation of any federal, state, or local law;

(21) contributions received before May 12 in the year of the election that were not contemporaneously reported as matchable in disclosure statements or were reported in such statements that were not filed in a complete and timely manner;

(22) contribution checks drawn on business accounts, or accounts that bear indicia of being business accounts, such as the contributor’s professional title;

(23) contributions purportedly from different contributors that were made by money orders bearing consecutive serial numbers or other markings indicating that they were purchased simultaneously;

(24) arithmetical errors in totals reported;

(25) contributions that were not itemized in a disclosure statement;

(26) transfers made to a political committee that is not authorized for an election in which the candidate is currently a participant, as described in Rule 5-01(n)(1); and

(27) contributions required to be deposited into an account established for a runoff election, as provided in Rule 2-06(c);

(28) contributions from individuals, other than employees of the candidate’s principal committee, who are vendors to the participant or individuals who have an interest in a vendor to the participant, unless the expenditure to the vendor is reimbursement for an advance. For the purposes of this rule, “individuals who have an interest in a vendor” shall mean individuals having an ownership interest of ten percent or more in a vendor or control over the vendor. An individual shall be deemed to have control over the vendor firm if the individual holds a management position, such as the position of officer, director or trustee; and

(29) contributions from individuals having business dealings with the city, as defined in §3-702(18) of the Code, and contributions from lobbyists as defined in §3-211 of the Code.

(e) Withholding of public funds.

The Board shall withhold five percent of the amount of public funds payable to a participant until the final pre-election payment for any election in which the participant is eligible to receive public funds. In addition, the Board, in its discretion, may withhold a reasonable portion of the amount of public funds payable to a participant based upon:

(1) a projection of the rate(s) of invalid matchable contribution claims; and

(2) the participant’s failure to provide to the Board, upon its request, documents or records required by Chapter 4 of these rules, or other information.

(f) Basis for ineligibility determination. The Board shall determine whether public funds shall not be paid to a participant for reasons that include, but are not limited to:

(1) if there is reason to believe that the participant has committed a violation of the Act or these Rules;

(2) if the participant has failed to meet one of the eligibility criteria of the Act or these Rules;

(3) if the participant is required to repay public funds previously received, as described in Rule 5-03, or if the participant has failed to pay any outstanding claim of the Board for the payment of civil penalties or the repayment of public funds against such participant or his or her principal committee or a principal committee of such participant from a prior covered election, provided that the participant has received written notice of the potential payment obligation and potential ineligibility determination in advance of the certification deadline for the current covered election or an opportunity to present reasons for his or her eligibility for public funds to the Board;

(4) if the participant fails to submit a disclosure statement required by these rules;

(5) if the participant fails to provide to the Board, upon its request, documents or records required by Chapter 4 of these rules, or other information that verifies campaign activity;

(6) if previous public fund payments to the participant for the election equal the maximum permitted by the Act;

(7) if the participant or an agent of the participant has been found by the Board to have committed fraud in the course of Program participation or to be in breach of certification pursuant to Rule 2-02; or

(8) if the participant fails to file the receipt indicating compliance with §12-110 of the Code, as required pursuant to §3-703(1)(m) of the Code and Rule 3-11;

(9) if the participant endorses or publicly supports his or her opponent for election pursuant to §3-705(9) of the Code; or

(10) if the participant loses in the primary election but remains on the ballot for the general election and fails to certify to the Board, as required by §3-705(10) of the Code, that he or she will actively campaign for office in the general election, or if the participant certifies to the Board that he or she will actively campaign for office in the general election but thereafter fails to engage in campaign activity that shall include but not be limited to, raising and spending funds, seeking endorsements, and broadly soliciting votes.

(g) Payment is not final determination. Payments of public funds pursuant to this rule shall not constitute the Board’s final determination of the amount, if any, for which the participant qualifies. The Board shall provide specific notice of any such final determination.

(h) Notice to participants. The Board shall notify participants of any difference between the amount claimed and amount paid. Subsequent payments may be adjusted upward or downward to reflect further review and auditing of previous matchable contribution claims.

(i) Pre-election payments. (1) Pursuant to §§ 3-709(5) and (6) of the Code: (i) no public funds shall be paid to participants in a primary election any earlier than two weeks after the last day to file designating petitions for such primary election; (ii) no public funds shall be paid to participants in a runoff primary election or general election any earlier than the day after the day of the primary election held to nominate candidates for such election; and (iii) no public funds shall be paid to participants in a runoff special election held to fill a vacancy any earlier than the day after the day of the special election for which such runoff special election is held.

(2) Pursuant to §3-703(1)(a) and (5) of the Code, public funds are not payable to a participant who has not met the legal requirements to have his or her name on the ballot or who is unopposed. To enable the Board to ascertain whether a candidate has met the legal requirements to be on the ballot and is opposed, the Board shall first make payments in an election after the Board of Elections conducts hearings on the ballot petitions filed in that election except if the Board determines that delays in Board of Elections proceedings or determinations warrant first making payments earlier.

(3) The Board shall schedule at least three payment dates in the thirty days prior to a covered election, and the Board shall provide each candidate a written determination specifying the basis for any non-payment. Candidates may petition the Board in writing for a reconsideration of any such non-payment determination, and in the case of a petition received prior to the election, such reconsideration shall occur within five business days of the filing of such petition. The candidate shall not include in any such petition any documentation or information not submitted to the Board prior to the non-payment determination that is the subject of the petition unless such documentation or information is specifically requested in writing by the Board or the candidate demonstrates good cause for the previous failure to submit such documentation or information on a timely basis. In the event the Board is unable to convene within five business days, the Board may delegate to the Chair of the Board or his or her designee authority to make a determination regarding the petition. If the petition is denied, the Board shall provide notice to the candidate of the reasons for such denial and notify the candidate of his or her right to appeal the Board’s determination pursuant to Article 78 of the Civil Practice Law and Rules.

(j) Flat grants in special circumstances. Pursuant to §3-705(5)(a) of the Code, the Board shall pay to a participant in a runoff primary election or runoff special election an amount equal to twenty-five cents for each one dollar of public funds paid to the participant for the preceding election. The amount paid pursuant to this subdivision may be adjusted to reflect further review and auditing of matchable contribution claims for the preceding election. The Board shall make payments pursuant to this subdivision within four business days after the date of the preceding election or as soon thereafter as practicable.

(k) Post-payment audits. All determinations by the Board of eligibility and payment are subject to post-payment audit and final readjustment.

(l) Characterization of payments as for the primary or general election. (1) If a participant is on the ballot and has an opponent on the ballot in both a primary and the general elections, payments made after the primary election will be characterized initially as follows:

(i) As a primary election payment, if the payment is made on the basis of contribution and expenditure information reported in or before the disclosure statement due 10 days after the primary election, except as otherwise provided in subparagraph (ii).

(ii) As a general election payment, to the extent that any further primary election payments would exceed a maximum applicable in the primary election pursuant to the Act.

(iii) As a general election payment, if the payment is made on the basis of contribution and expenditure information reported in disclosure statements due later than 10 days after the primary election.

(2) If the Board determines that payments characterized initially as either primary or general election payments were, in fact, used for qualified campaign expenditures incurred in the other election, the payments will be recharacterized accordingly, and additional payments may be made or repayments required, if appropriate. The total public funds used for qualified campaign expenditures in a single election may not exceed the maximum applicable pursuant to §3-705(2) of the Code.

(m) Post-election payments. After an election the Board may defer payment determinations for a participant until the completion of its audit of the participant. The Board shall not make payments based upon disclosure statement amendments or resubmissions filed (i) after December 31 in an election year, including but not limited to amendments or resubmissions of the disclosure statement due the first January 15 after the election, or (ii) after the final disclosure statement in the case of a special election; provided however, that the Board may make payments based upon such amendments or resubmissions solely if they are made in response to invalid matching claims reports to which the Board has requested a response after December 31 in an election year or after the final special election disclosure statement, as the case may be.

(n) Deductions from payments. (1) The following will be deemed to consist entirely of contributions claimed to be matchable: (i) transfers and other disbursements from a political committee that is involved in an election in which the candidate is currently a participant to a political committee that is not involved in that election; (ii) expenditures made to pay expenses for or debt from a previous election, including repayments of public funds owed to the Board for a previous election; (iii) contributions to other political committees that do not meet the requirements provided in §3-705(8) of the Code for contributions that shall not be a basis for reducing public funds payments; and (iv) loans to or spending for other candidates (including joint expenditures to the extent such expenditures benefit another candidate, and independent expenditures) and loans to or spending for political party committees and political clubs, that are not reimbursed within 30 days, provided that if the participant demonstrates that the expenditure was for a tangible item that directly promotes the participant’s election, such as an advertisement in a fundraising journal, this subdivision shall not apply to the fair market value of that item. An amount equal to the amount of public funds the participant is otherwise eligible to receive for such matchable contribution claims shall be deducted from the public funds paid to the participant.

(2) Notwithstanding paragraph (1) above, disbursements otherwise subject to a deduction pursuant to paragraph (1) shall not be subject to such deduction if:

(i) such disbursements are made out of a segregated bank account;

(ii) at no time does such segregated bank account contain any funds other than contributions received by the participant and deposited directly into such account pursuant to this Rule, and bank interest paid thereon;

(iii) funds deposited into the segregated bank account are not used for any purpose other than (I) disbursements governed by paragraph (1) above or (II) payment of bank fees associated with the segregated bank account;

(iv) contributors whose contributions are deposited into such segregated bank account have confirmed in writing, pursuant to Rule 4-01(b)(7), that they understand that these contributions will only be used for such disbursements and will not be matched with public funds;

(v) copies of such written confirmations are submitted to the Board by the due date for the disclosure statement in which such contributions are required to be reported pursuant to these Rules;

(vi) copies of checks for each disbursement out of such segregated bank account are submitted to the Board by the due date for the disclosure statement in which such disbursements are required to be reported pursuant to these Rules;

(vii) a copy of each bank statement for such segregated bank account is submitted to the Board as soon as reasonably practicable after it is available to the campaign from the bank; and

(viii) for each individual contribution deposited into a segregated bank account, and each disbursement out of such account, the participant has complied with all other applicable provisions of the Act and these Rules, including but not limited to the record keeping and reporting provisions.

(3) Rule 1-09 shall be applicable for the purposes of determining the date of receipt by the Board of documents submitted pursuant to this Rule.

(4) Participants may not deposit a portion of a particular contribution into the segregated bank account provided for in paragraph (2), but must rather deposit the entire contribution into the account.

(5) Contributions deposited into a segregated bank account pursuant to this Rule will not be matched with public funds.

(6) A participant who establishes a segregated bank account pursuant to this Rule but fails to comply with any provision of paragraph (2) or (4) above shall no longer be entitled to the exception from paragraph (1) contained in paragraph (2) above.

(o) Use of final payment. Before the Board makes final payment, the participant shall submit to the Board bills or other documentation of outstanding debt for which the final public funds payment will be used. Within 60 days after the final public funds payment, the participant must demonstrate that the public funds were used to pay such outstanding debt or shall repay the public funds to the Board.

(p) Responding to invalid matching claims reports. In the event that the Board concludes that one or more of a participant’s matchable contribution claims are invalid, a participant responding to the Board’s report shall do so by the March 15 following the election or 60 days after receiving the report, whichever is later. In the case of a special election, a participant shall respond to an invalid matching claims report no later than 60 days after receiving the report.

(q) Ballot disqualification by Board of Elections; candidate not opposed on the ballot. The Board will not make payment to any participant disqualified from the ballot by the Board of Elections or by a court, or to any participant for an election in which all other candidates have been disqualified from the ballot by the Board of Elections or by a court, until after such participant or other candidate, as the case may be, is restored to the ballot by a subsequent determination by a court of competent jurisdiction. A participant who appears as the only candidate on the ballot in an election shall not be eligible to receive public funds, notwithstanding any write-in candidates in that election, except as otherwise provided in Rule 5-02(b).

(r) Reduction in maximum public funds payable. Pursuant to §3-705 of the Act, the maximum amount of public funds a participant may otherwise be eligible to receive will be reduced by the sum of the following: (1) any public funds retained by the Board in lieu of civil penalties; (2) any public funds retained by the Board in lieu of funds the participant is required to pay back to the Fund pursuant to the Act; (3) any public funds withheld pursuant to Rule 5-01(e)(2); and (4) pursuant to §3-703(1-b) of the Code, an amount equal to the total unreturned contributions in excess of the limitations applicable to persons having business dealings with the city.

(s) Approval by Board subject to correction of limited, isolated, and easily corrected compliance issues. The Board, in its discretion, may approve a public funds payment to a participant, notwithstanding that the participant has been determined by the Board to be ineligible to receive public funds because of limited, isolated, and easily corrected compliance issues. Such approval of public funds disbursement shall be conditioned upon a satisfactory demonstration by the participant that it has taken action, as specified by the Board and within a period of time specified by the Board, to comply with the Act and these rules. The participant shall have the burden of demonstrating to the Board that it has fully complied with the Board ’s requirements.

(t) Payment of expenditures made in connection with litigation with public funds. A participating candidate and his or her principal committee may not use public funds to pay expenditures made in connection with any action, claim, or suit before any court or arbitrator.

(u) Payment by electronics funds transfer. All payments of public funds shall be by electronic funds transfer unless the Board determines, in its sole discretion, to use an alternative payment method. In order to receive prompt payment, the participating candidate shall provide the Board with a voided check and such additional information as shall be required by the Board.

Rule 5-02 Review of Eligibility, Payment, and Repayment Determinations.

(a) Post-election written petitions for review.

(1) After the Board determines that a participant is ineligible for public funds or matchable contribution claims are invalid, the Board shall provide a written determination specifying the basis for any ineligibility or invalidation. The participant, within 30 days of such determination, may submit to the Board a written petition for review of the determination including a request to appear before the Board concerning the subject of such petition. To the extent practicable, the Board shall make a determination on such petition within 30 days of receipt of the written petition. Upon such determination, the Board shall issue written notice to the petitioner of the Board’s determination, including the reason(s) for the determination and, in the event that the Board denies such petition, the Board shall immediately notify the candidate of the right to appeal pursuant to Article 78 of the Civil Practice Law and Rules.

(2) The participating candidate and his or her principal committee shall not include in any such petition any documentation or factual information not submitted to the Board prior to the determination under review unless the participating candidate can demonstrate good cause for the previous failure to submit such documentation or information and for any failures to communicate on a timely basis with the Board.

(b) Final disqualification from the ballot. The Board will consider a candidate to be finally disqualified from the ballot on the earlier of the date of an administrative or judicial determination disqualifying the candidate for which there is no appeal as of right (unless the disqualification is reversed on appeal or otherwise) or of the election. Payment may be made to a participant who was temporarily on the ballot or opposed in an election, pursuant to a determination of the Board of Elections or a court of competent jurisdiction, but then ultimately disqualified from the ballot or unopposed in that election, only when the Board’s audit of the participant’s campaign has been completed and only if the participant has, within 30 days after the date of the final disqualification, as provided herein, filed a written petition, sworn to or affirmed, and supporting documentation that demonstrates that: (1) liabilities in qualified campaign expenditures incurred before the date of final disqualification remain unpaid; (2) the total amount of cash on hand is insufficient to pay these liabilities; (3) hardship will exist if public funds are not paid; (4) any and all expenditures made and liabilities incurred after the final disqualification were reasonable and necessary; and (5) the campaign was otherwise eligible and in compliance with all other Program requirements as of the date of final disqualification and has remained in compliance at all times since that date. The petition shall also include an undertaking to use any public funds paid for extinguishing the liabilities enumerated pursuant to paragraph (1).

Rule 5-03 Repaying Public Funds.

(a) Participants returning public funds. Participants returning public funds shall make a check payable or endorse the public fund check to the “New York City Election Campaign Finance Fund.” Participants may not reclaim public funds they have returned.

(b) Participant is disqualified from the ballot. (1) Pursuant to §3-709(7) of the Code, a participant who has been finally disqualified or whose designating or nominating petitions have been finally declared invalid by the New York City Board of Elections or a court of competent jurisdiction, may not thereafter spend public funds for any purpose other than the payment of previous liabilities incurred in qualified campaign expenditures. All public funds in excess of such liabilities previously incurred shall be promptly repaid to the Board; the amount to be repaid shall be determined in accordance with §3-710(2)(b) of the Code and subdivision (d). A repayment made pursuant to §3-709(7) shall not preclude a determination that an additional repayment is required pursuant to that or any other provision of the Act.

(2) Pursuant to §3-710(3) of the Code, a participant who has been disqualified by a court of competent jurisdiction on the grounds that he or she committed fraudulent acts in order to obtain a place on the ballot, and such decision is not reversed, shall pay to the Board an amount equal to the total public funds paid to the participant. Payments required pursuant to this paragraph shall be made promptly upon such final determination.

(c) Excess public fund payments. Pursuant to §3-710(2)(a) of the Code, the Board shall notify a participant in writing if public funds paid to the participant were in excess of the aggregate amount for which the participant qualified, and such participant shall pay to the Board an amount equal to the amount of the excess payments.

(d) Improper use of public funds. Pursuant to §3-710(2)(b) of the Code, the Board shall notify a participant in writing if it finds that public funds paid to the participant were used for purposes other than qualified campaign expenditures and the participant shall repay to the Board any improperly used public funds; provided, however, that in considering whether or not a participating candidate shall be required to pay to the Board such amount or an amount less than the entire amount to be repaid, the Board shall act in accordance with the following: (i) where credible documentation supporting each qualified campaign expenditure exists but is incomplete, the Board shall not impose such liability for such expenditure; (ii) where there is an absence of credible documentation for each qualified campaign expenditure, the Board may impose liability upon a showing that such absence of credible documentation for such expenditure arose from a lack of adequate controls including, but not limited to trained staff, internal procedures to follow published Board guidelines and procedures to follow standard financial controls.

(e) Unspent campaign funds. (1) Pursuant to §3-710(2)(c) of the Code, the Board shall notify a participant in writing if it finds that the participant owes unspent campaign funds to the Board. The participant shall promptly pay to the Board unspent campaign funds from an election; provided, however, that all unspent campaign funds for a participant shall be immediately due and payable to the Board upon a determination by the Board that the participant has delayed the post-election audit process. The participant shall promptly pay to the Board any additional unspent campaign funds based upon a determination made by the Board at a subsequent date. Unspent campaign funds determinations made by the Board shall be based on the participant’s receipts and expenditures (including any outstanding bills). The Board may also consider information revealed in the course of an audit or investigation in making an unspent campaign funds determination, including, but not limited to, the fact that campaign expenditures were made in violation of law, that expenditures were made for any purpose other than the furtherance of the participant’s nomination or election, or that the participant has not maintained or provided requested documentation.

(2) (i) A participant may not use receipts for any purpose other than disbursements in the preceding election until all unspent campaign funds have been repaid, except as otherwise provided in Rule 1-03(b). Notwithstanding the presumption of Rule 1-08(c)(1), a participant has the burden of demonstrating that a post-election expenditure is for the preceding election.

(ii) Before repaying unspent campaign funds, a participant may make post-election expenditures only for routine activities involving nominal cost associated with winding up a campaign and responding to the post-election audit. Such expenditures may include: payment of utility bills and rent; reasonable staff salaries and consultancy fees for responding to a post-election audit; reasonable staff salaries and legal fees incurred prior to the date of the issuance of the participant’s final audit report and associated with defending against a claim that public funds must be repaid; a post-election event for staff, volunteers, and/or supporters held within thirty days of the election; reasonable moving expenses related to closing the campaign office; a holiday card mailing to contributors, campaign volunteers, and staff; thank you notes for contributors, campaign volunteers, and staff; payment of taxes and other reasonable expenses for compliance with applicable tax laws; and interest expense. Routine post-election expenditures that may be paid for with unspent campaign funds do not include such items as post-election mailings other than as specifically provided for in this subparagraph; making contributions; or making bonus payments or gifts to staff or volunteers. Unspent campaign funds may not be used for transition and inauguration activities.

(iii) Notwithstanding the restriction on the use of receipts provided in subdivision (2)(i), a participant who has outstanding liabilities from the election, including a participant who owes public funds or penalties to the Board, may make post-election expenditures for the purpose of raising funds to repay such debt, provided, however, that such expenditures and any contributions received shall be included in the participant’s unspent funds calculation unless such expenditures and contributions are incurred or received after the date of the issuance of the participant’s final audit report.

(f) Other reasons for repayment. The Board shall notify a participant of any amount of public funds to be repaid because: (i) the participant has not maintained copies of checks or contribution cards that document matchable contributions; or (ii) the public funds paid were based on contributions that have been returned or contribution checks that have not been paid; or (iii) the participant has failed to demonstrate eligibility for the public funds paid or compliance with Program requirements, or both; or (iv) a determination pursuant to §§ 3-705(6), (7), or 3-706(3) of the Code is reversed following reconsideration pursuant to Rule 7-03(k).

(g) Repayment determinations. The participant shall promptly repay public funds upon any determination made by the Board that a repayment is required pursuant to the Act and this rule. Any claim for the repayment of public funds shall be based on a final determination issued by the Board following an adjudication pursuant to Rule 7-02(f), unless such adjudication is waived by the candidate or principal committee.

Rule 5-04 Fund Administration.

To safeguard the administration of the Fund and assure candidates that sufficient public funds will be available to make all payments required by the Act in upcoming elections, as guaranteed to participants by Charter §1052(a)(10), the Board shall: (a) make budget requests for the Fund sufficient to cover all anticipated Fund obligations in the upcoming fiscal year and to maintain a reserve for contingencies; (b) when it has determined that monies in the Fund are insufficient or likely to be insufficient for payments to participants, report this determination to the Commissioner of Finance and provide its estimate of the additional amount which will be necessary to make such payments pursuant to the Act (together with a detailed statement of the assumptions and methodologies on which the estimate is based), as required by Charter §1052(a)(10), not more than four days after which the Commissioner of Finance is required by Charter §1052(a)(10) to transfer an amount equal to the Board’s estimate from the City’s general fund to the Fund; (c) take steps to ensure that the Fund is maintained in a separate account, credited with all sums appropriated therefor and all earnings accruing thereon, in the custody of the comptroller on behalf of the Board, as required by Charter §1052(a)(10); (d) take steps to ensure that the Fund and its administration are insulated from the risk of improper action by any City official or agency or any agent or contractor thereof; (e) subject the Fund to periodic audits by independent outside auditors; and (f) take such other actions as are necessary and proper to insure the integrity of the Fund.

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New York City Campaign Finance Board Rules