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2000-7: Guidelines for 2001 Re-Election and Post-2001 Election Program Participant Candidates

November 16, 2000

Re: Administrative Code §§3-703(8), (12); 3-710; Campaign Finance Board Rules 1-04(f); 1-05(h); 1-08(c) (1); 3-02, et seq.; Chapter 4, 5-03(e);Advisory Opinions Nos. 1996-2, 1999-5; Op. No. 2000-7

An Opinion has been requested by a current member of the New York City Council who is running for re-election in 2001 ("the candidate").1 The candidate intends to participate in the New York City Campaign Finance Program (the "Program") for the 2001 election and has established a political committee for this purpose (the "re-election committee"). The candidate also wishes to establish a separate political committee in connection with a race for a different office after the 2001 elections (the "post-2001 committee"). The candidate, however, has not determined what office he or she will seek. The candidate states that the two committees will maintain separate bank accounts and conduct separate fund-raising, and that the post-2001 committee will not contribute or lend money to, or make expenditures of any kind on behalf of the candidate's re-election campaign. In addition, the request states that "the post-2001 committee will not promote the candidate prior to the 2001 election except to the extent of the materials involved in its fund raising activities."2

The candidate requests an advisory opinion whether the activities in connection with the post-2001 committee will be attributed to the re-election committee:

Specifically, will contributions to the post-2001 committee prior to January 12, 2002 be combined with contributions to the re-election committee for purposes of campaign contribution limits; will expenditures by the post-2001 committee for fund raising and administrative expenses be combined with the expenditures of the re-election committee for purposes of expenditure limits; and, at the conclusion of the 2001 election, will the funds held by the post-2001 committee be deemed to be surplus funds of the re-election committee for determining reimbursement of surplus funds to the CFB. In addition, are there any other ways in which the activities of the post-2001 committee will impact on the candidate's participation in the CFB program. Finally, to what extent will the post-2001 committee make disclosure to the CFB.


Contributions and Expenditures

Contributions and loans received and expenditures made are presumed by the Campaign Finance Board (the "Board") to be for the first election in which the participant is a candidate following the day that they are received or made. Rules 1-04(f), 1-05(h), and 1-08(c) (1). Accordingly, funds raised and spent after January 12thsubsequent to the candidate's last election would ordinarily be presumed to be raised and spent for the 2001 City Council elections. This presumption, however, can be overcome.In the request, the candidate's attorney states:

fund raising by the post-2001 committee will be conducted entirely separately from that of the re-election committee. The post-2001 committee will not donate, contribute or lend any money to the re-election committee, nor will it make any expenditures of any kind on behalf of the candidate's bid for re-election to the City Council.

If in fact all activities are conducted independently, including with separate staffs and administrative functions, the contributions raised and the expenditures made by the post-2001 committee would not be subject to the limits and the contribution restrictions of the Campaign Finance Act (the "Act") for the 2001City Council elections,3 except to the extent that the fund-raising activities of the post-2001 committee promote the candidate in a manner that affects his or her re-election. See Advisory Opinions Nos. 1996-2 (July 18, 1996), 1999-5 (February 23, 1999). This Advisory Opinion does not address what portion, if any, of these fund-raising expenditures are properly attributed to the re-election committee, because more information would be required in order to do so.


If the re-election committee has chosen not to file contemporaneous semi-annual disclosure statements with the Board pursuant to Rule 3-02(i), it must file its first disclosure statement on June 21, 2001 and file all other disclosure statements for the 2001 election. If the re-election committee has chosen to file contemporaneous disclosure statements with the Board, it should continue to do so. Rule 3-02, et seq.

The disclosure requirements for the post-2001 committee depend upon whether or not that committee is authorized for an election covered by the Act. If the post-2001 committee is authorized for a covered election, it must file semi-annual disclosure statements with the Board for the contributions received during those statement periods to be eligible for public matching funds. New York City Administrative Code ("Administrative Code") §3-703(12).4 If the post-2001 committee is authorized for a non-covered election, it is not ordinarily subject to disclosure or other Program requirements. Rule 3-02(f) (5) (interpreting administrative Code §3-703(8)); see Advisory Opinion No. 1996-2 (July 18, 1996).The Board, however, may request that the post-2001 committee file with the Board copies of the disclosure statements it is required to file with either the Board of Elections or the Federal Election Commission. Id.

Surplus Funds

A participant who has received public funds and has a surplus at the end of the election must repay those surplus funds to the Board (up to the amount of public funds received) prior to using those funds for any other purpose. Administrative Code §3-710(2) (c); Rule 5-03(e). If the post-2001 committee is in fact completely separate from the re-election committee, the Board will not include the funds of the post-2001committee in calculating the surplus funds due to be repaid by the re-election committee.

Audit of Financial Records

The financial records of the re-election committee are subject to audit and examination by the Board. Administrative Code §3-710; Rules Chapter 4. Similarly,whether or not the post-2001 committee is authorized for a covered election, it is subject to audit and examination by the Board at the Board's instance to ensure full compliance by the participating candidate with the Act and the Rules. Rule 3-02(f) (5) (interpreting Administrative Code §3-703(8)); see Advisory Opinion No. 1996-2 (July 18, 1996). The Board may review the financial records and other materials of the post-2001 committee for the purposes of confirming the separation of the two committees' efforts, the extent to which, if any, the post-2001 committee's activities promote the candidate's 2001 campaign, and to verify the re-election committee's compliance with Program requirements. Based upon the examination of the materials provided by the post-2001 committee, including its disclosure statements,financial records, and fund-raising materials, the Board may determine that some or all of the activities of the post-2001 committee should be attributed to the re-election committee. This determination would be based upon the Board's findings that the activities of the two committees are not in fact completely separate, or that there-election committee is receiving a benefit from the activities of the post-2001committee which the re-election committee has not reported and which should appropriately be attributed to it. If the activities of the two committees overlap or if the activities of the post-2001 committee promote the candidate in a manner that affects the re-election campaign, the re-election committee should look to Advisory Opinion No. 1996-2 for initial guidance.


1 The request was made by Henry T. Berger, by letter dated September 22, 2000, without identifying the candidate on whose behalf it is made.

2 This opinion is based on the facts presented in the candidate's request, and as such, it is limited to those facts.

3 The request does not indicate whether the candidate anticipates running for an office covered by the Act after 2001. If the candidate runs for a covered office, he or she will be subject to the contribution and expenditure limits, and contribution restrictions applicable to the office sought.

4 Since the request indicates the candidate will be seeking a "different" office after 2001, the post-2001 committee may be governed by Administrative Code §3-703(12) (requiring contemporaneous disclosure with the Board), which does not apply to candidates for the City Council.