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1989-3: Expenditure Limits for Expenses Made In Connection With the Solicitation of Funds

January 25, 1989

An opinion has been requested whether certain expenditures incurred in connection with a direct mail solicitation of contributions and a fundraising birthday dinner are subject to the 1988 expenditure limit (New York City Administrative Code §3-706(2)) or the 1989 expenditure limits (Administrative Code §3-706(1)) for a candidate seeking election in 1989. Several expenditures have been described: the cost of preparing, printing, and mailing the direct mail solicitation, and the cost of the invitations, postage, programs, caterer, flowers, and music for the dinner. All the goods, services, and literature purchased were "delivered, rendered, received, published, distributed, and consumed in 1987."

Subdivision two of Administrative Code §3-706(2) provides, in relevant part:

The following limitations apply to all expenditures made by a candidate and his or her authorized committees in the calendar year preceding the year of the election for which such candidate chooses to participate in the public funding provisions of this chapter and to expenditures made at any time prior to such date for services, materials, facilities, advertising or other things of value received, rendered, published, distributed or broadcast in such calendar year.

(Emphasis added). The limitations applicable to expenditures made on or after January 1, 1989 on behalf of a candidate seeking election in 1989 covers prior expenditures in the same manner. See Administrative Code §3-706(1) . Section 105(f) of the Campaign Finance Board Regulations provides:

For purposes of the limitations imposed by Section 3-706(1) and (2) of the code, an expenditure for a service, material, facility, advertising, or other thing of value is made during the calendar year in which the service, material, facility, advertising, or the thing of value is received, rendered, published, distributed, or broadcast, regardless when the payment for the service, material, facility, advertising, or thing of value, or promise to make such payment, is made. Expenditures for services, materials, facilities, advertising, or other things of value received, rendered, published, distributed, or broadcast in more than one year shall be attributed in a reasonable manner to the expenditure limitations of Section 3-706(1) or (2) of the code, as appropriate.

(Emphasis added).

It is the opinion of the Board that because the expenditures described above occurred entirely in 1987, they would not be subject to the expenditure limits contained in §3-706(1) or (2) whether payment for these expenditures was made in 1987, 1988, or 19891.



1 A recently adopted amendment to the New York City Campaign Finance Act, Local Law No. 4 of 1989, removes "expenditures in connection with the solicitation of funds" from the 1988 and 1989 expenditure limits, except for those fundraising expenditures which exceed the greater of twenty percent of the applicable expenditure limit or $20,000. New York City Administrative Code §3-706(5) (b), as added by Local Law No. 4 of 1989.