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1996-3: Expenditure Limit for Legal Costs Associated with a Lawsuit Challenging the Election Results

December 12, 1996

Re: Administrative Code § 3-702(3); 3-704(2) (h); 3-706(4); Campaign Finance Board Rules 1-05(g); 1-08(d) (1); 3-02(f) (7); Op. No. 1996-3

An advisory opinion has been requested on behalf of Miller for City Council ("MCC"), City Councilman A. Gifford Miller's campaign committee for the special election held on January 16, 1996, in the Fifth Council District1. Following Miller's victory in the special election, a separate committee, Miller for City Council '96, was authorized for the subsequent primary and general elections, which Miller also won. The request states that Miller has been served with a summons and amended complaint challenging the results of the special election2. The request asks whether costs and expenses now incurred to defend the lawsuit can be attributed to the special election and paid by MCC.

The legal costs associated with defending this lawsuit are expenditures for the special election, payable by MCC. Because defending the results of an election is tantamount to defending the validity of a certificate of nomination, expenses incurred for this purpose are exempt from the Campaign Finance Act's expenditure limits, but may not be paid for with public funds. See New York City Administrative Code § 3-704(2) (h), 3-706(4); Advisory Opinion No. 1991-7 (October 9, 1991). See also Advisory Opinion No. 1996-1 (April 4, 1996). Following recent amendments in Campaign Finance Board rules, all expenditures for this special election incurred by MCC after January 1, 1997 are not subject to the expenditure limits. Campaign Finance Board Rule 1-08(d) (1).

As MCC will be incurring legal costs, it is presumed that it will need to conduct further fund raising to pay for such costs. Any further fund raising conducted by MCC is subject to all Program requirements for the special election, including the $1,775 contribution limit, which also applies to post-election loans. See Rule 1-05(g). This additional fund raising may include valid claims for matching funds if received by December 31, 1996. See Administrative Code § 3-702(3).

MCC filed its final Campaign Finance Board disclosure statement for the special election on February 13, 1996. See Advisory Opinion No. 1995-1 (December 7, 1995). The Board may, however, request MCC to submit copies of its Board of Elections statements, and its financial records are subject to Board review for purposes of monitoring the participating candidate's compliance with Program requirements for the special election. See Rule 3-02(f) (7).



1 The request was made by Henry T. Berger, counsel to the Committee, in a letter to Nicole Gordon dated November 25, 1996.

2 The amended complaint alleges, inter alia, that the nominating petition requirements for this special election are unconstitutional. The relief sought includes a judgment declaring this special election null and void.