A Federal District Court has held Congress may constitutionally bar federal contractors from contributing to candidates, parties, and their committees.

Finding in favor of the Federal Election Committee (FEC), the United States District Court for The District of Columbia granted a summary judgment on Friday, November 2.

In Wagner v. FEC, the Court rejected challenges to the constitutionality of section 441c of Title 2 of the U.S. Code, which prohibits any vendors with contracts with the federal government from making political contributions to federal candidates or political parties.

The case, initially brought by the ACLU, asked the Court to declare the law unconstitutional as applied to individuals who have personal services contracts with federal agencies. Because federal workers who are not contractors may make federal political contributions, while contractors performing the same work may not, the suit argued section 441c violates both the Equal Protection Clause of the Constitution and the First Amendment.

The Court found no First Amendment or Equal-Protection violations, noting “the dissimilar roles of contractors and employees, moreover, justify the distinct regulatory schemes that the Government has fashioned.”

Today the FEC posted an article answering some questions about political contributions made and received by text messaging.

The article can be found here.

A federal appellate court has reversed a district court’s electioneering reporting decision, sending the issue back to the FEC.

The significance of today’s decision, pending further possible rule changes or court decisions, is that political contributors giving to an organization making an electioneering communication will not have to be disclosed to the FEC unless the donor specifically earmarks his or her contributions to fund electioneering communications.

This was the rule from 2007 until this spring when a district court ruled that all contributors giving over $1,000, regardless of whether they gave for the specific purpose of electioneering communications, had to be disclosed to the FEC.

In the initial lawsuit, Van Hollen v. FEC, the plaintiff,  U.S. Representative Van Hollen, claimed the FEC regulation 11 C.F.R. §104.20(c)(9), which requires disclosure only of those making contributions over $1,000 to an entity for the purpose of furthering electioneering communications, contradicts the statute requiring disclosure of all donors making contributions over $1,000.

In the spring, a U.S. district court agreed and declared 11 C.F.R. §104.20(c)(9) invalid and vacated the regulation. The court reinstated the FEC’s prior regulation, which was promulgated on December 17, 2002 and was in effect until December 25, 2007. The FEC had formally reiterated the district court’s requirement on July 27, 2012, retroactively applying the disclosure of donors to March 30, 2012.

Today, in Center for Individual Freedom v. Van Hollen, the U.S. Court of Appeals for the District of Columbia Circuit reversed Van Hollen v. FEC, vacated the district court’s prior judgment, and remanded the case to the district court. Presently, under the jurisdiction of the district court, the FEC must pursue rulemaking to address the issues brought by the lawsuit or defend 11 C.F.R. §104.20(c)(9) in court against the parties bringing the action.

This is a signature issue for Representative Van Hollen who will probably continue to vigorously litigate this issue.

The FEC has not publicly declared its next course of action.

The Federal Election Commission (FEC) issued an advisory opinion offering limited guidance on what type of solicitations for political contributions are permissible and what type of advertisements qualify as expressly advocating the election or defeat of a candidate.

In Advisory Opinion 2012-27, the FEC found two of four proposed donation requests permissible. The Commission also concluded three of seven proposed advertisements did not expressly advocate the election or defeat of a clearly identified federal candidate.

The remaining advertising and donation requests were not decided by the FEC because it lacked the required four affirmative votes for agreement.

National:

Conservatives Work to Cull Moderate Republicans

Poll: Public doesn’t like lobbyists, OK with lobbying

Federal:

Conservative Group Challenges Red Line Dividing Candidates, Super-PACs

FEC Says It Will Enforce Nonprofit Disclosure Rules

Households Divided by Campaign Donations

From the States and Municipalities:

California

Two Former Lynwood Officials Guilty of Illegally Boosting Salaries

Georgia

Georgia Voters Back Limits on Lobbyist Spending

Iowa

Contributions Dodged Rules, Records Show

Kentucky

Kentucky Lawyer’s Threatened Sanction Rejected on Free-Speech Grounds

New Jersey

Trenton Residents Lobby for Creation of City Ethics Board

New York

Lobbyists to Disclose Donors Since July 1

North Carolina

New Lobbyist Rankings Reflect GOP Takeover of NC Legislature

Ohio

Jimmy Dimora Sentenced to 28 Years in Prison, ‘A Life Sentence,’ Lawyers Say

Utah

Utah Supreme Court Ruling Ends Ethics Initiative Bid

West Virginia

W.Va. Election Commission Votes to Defend Public Financing Plan

State and Federal Communications produces a weekly summary of national news, offering more than 80 articles per week focused on ethics, lobbying, and campaign finance.

News You Can Use is a news service provided at no charge only to clients of our online Executive Source Guides, or ALERTS™ consulting clients.

The Federal Election Commission (FEC) announced persons reporting electioneering communications must report the name and address of each donor giving $1,000 or more, aggregated since the first day of the preceding calendar year.

The application of this rule applies retroactively to March 30, 2012, coinciding with a court decision in Van Hollen v. FEC that ruled the current regulation, 11 C.F.R. 104.20(c)(9), is invalid.

Previously, donors were only required to be disclosed if their donations were “made for the purpose of furthering electioneering communications.” The FEC will now consider all donors as contributors “regardless of their subjective purpose in contributing.”

As the Commission has not adopted any new regulations or explanation of its rules, and Van Hollen v FEC is still pending, the FEC outlined this requirement in a public statement issued Friday.

“FEC says it will enforce nonprofit disclosure rules” by Dan Eggen in The Washington Post.

“FEC Releases Disclosure Rules” by Elahe Izadi in the National Journal’s Influence Alley.

“Outside groups may have to disclose donors” by Robin Bravender and Dave Levinthal in Politico.

Here is the Federal Election Commission’s news release.

Federal:

FEC: Campaigns can raise money via text message

Howard Marlowe, Lobbyist Defender

K Street: ‘Let’s meet’; Hill staffers: ‘text me’

From the States and Municipalities:

Alaska

APOC Weighs in on Campaign Finance Question

Connecticut

ACLU, Businesses Oppose Campaign Financing Reporting Bill

Georgia

Former Director, Assistant File Lawsuits against Ethics Commission

New York

Lobbyists Directed Contributions

New York

Unexpected Stand against Disclosure

Pennsylvania

GOP Will Discuss Skinhead Winner

South Carolina

Rep. Jim Merrill Faces Ethics Questions over Work with Realtors

Texas

Constitution’s ‘Supreme Being’ Clause Targeted Again

State and Federal Communications produces a weekly summary of national news, offering more than 80 articles per week focused on ethics, lobbying, and campaign finance.

News You Can Use is a news service provided at no charge only to clients of our online Executive Source Guides, or ALERTS™ consulting clients.

The Federal Election Commission (FEC) has issued an advisory opinion approving text messaging of political contributions in federal elections.

Political and media consulting firms Red Blue T LLC and AnnourMedia, Inc., along with m-Qube, Inc, a merchant billing service provider, requested approval from the Federal Election Commission (FEC) to use text messaging to raise funds for political committees.

In AO 2012-17, the commission concluded the proposed plan made to use the merchant billing service as intended is consistent with reporting requirements, conforms to the prohibition on corporate contributions, complies with forwarding requirements when making factored payments, and satisfies the segregation requirement for commercial vendors processing the contributions.

The proposal envisions two methods for the use of text messaging to make contributions:

In the first method, a wireless user would text a pre-determined message to a common short code registered to a political committee. A text message response sent by the merchant to the user would then require the user to respond with his or her own text message to confirm the user’s intent to engage in the transaction and certify the user’s eligibility to make a contribution.

With the second method, a user would enter his or her mobile phone number on a political committee’s website. Before submitting the phone number, the user will be required to certify his or her eligibility to make a contribution. After the user makes the certification and submits the phone number, the user will receive a text message from the merchant that includes a PIN. The user will enter the PIN on the political committee’s website to confirm the transaction.

No mobile phone number can be billed more than $50 per month for contributions to any one political committee.

Campaign Finance

“FEC: Campaigns can raise money via text message” by Dave Levinthal in Politico.

“FEC sues ex-Sen. Craig over use of campaign cash” by The Associated Press on CBSNews.com.

“NJ considers changes to election finance rules” by The Associated Press in the Bergen Record.

Government Ethics

Georgia: “Squirrely Ethics in Georgia, Former Exec Says” by Iulia Filip in the Courthouse News Service.

New Mexico: “New Mexico agency compiled email list for governor’s PAC” by Steve Terrell in the Santa Fe New Mexican.

State and Federal is sponsoring a breakfast hosted by Women In Government Relations’ PACs, Politics, & Grassroots task force with FEC Chair Hunter.  If you are in Washington next Wednesday, June 6,  join us for a conversation about FEC activities and priorities in this election year.

This particularly timely discussion will help PAC leaders, government relations staff and anyone associated with the political process understand what the landscape looks like for elections in the U.S. moving forward.  With some major nuances present this year that have never been present before, this is a great opportunity to know what to do, what not to do, what your colleagues are doing and what the FEC will be focusing on in the coming months!

Hope to see you there!

The Federal Election Commission (FEC) unanimously approved five legislative recommendations to be submitted to the U.S. Congress.

One proposed change would require all Senate candidates and their committees to use electronic filing.

The FEC also recommends the Commission have permanent authority to assess administrative fines, Congress expand the prohibitions on fraudulent misrepresentation of campaign authority, and the personal use restrictions to all political committees be extended. Additionally, the FEC is advocating Congress amend the law to allow the FEC to create Senior Executive Service positions under the Civil Service Reform Act of 1978 in line with other comparable federal agencies.

The Federal Election Commission (FEC) approved several advisory opinions on a variety of issues.

In AO 2012-12, the FEC allowed a corporation to solicit contributions from its non-corporate franchisees and licensees’ executive and administrative personnel. The FEC found the personnel were part of Dunkin Brands, Inc. restricted class because of the degree of control it maintained on the franchisees and licensees.

In another opinion, the FEC concluded an association of physician-owned hospitals are not federal contractors although they provided services to patients in government-sponsored healthcare programs such as Medicaid. Therefore, the association is not prohibited from making contributions to independent expenditure-only political committees.

Additionally, the FEC found a New Hampshire campaign finance statute requiring disclaimers for telephone surveys was preempted by federal statutes and FEC regulations because the calls in question were only related to federal candidates.

The FEC also let stand the $46,200 aggregate limit for contributions to federal candidates over a request to contribute amounts over this limit.

The FEC press release concerning these and other decisions can be found here.

A Federal District Court denied a preliminary injunction request demanding the Federal Election Commission (FEC) not enforce a law prohibiting individuals with federal contracts from making political contributions to federal candidates or political parties.

In Wagner v. Federal Election Commission, filed in the United States District Court for the District of Columbia, the Court rejected challenges to the constitutionality of section 441c of Title 2 of the U.S. Code, which prohibits any vendors with contracts with the federal government from making such contributions.

The case, brought by the ACLU, asked the Court to declare the law unconstitutional as applied to individuals who have personal services contracts with federal agencies. Because federal workers who are not contractors may make federal political contributions, while contractors performing the same work may not, the suit argued section 441c violates both the Equal Protection Clause of the Constitution and the First Amendment.

In denying the preliminary injunction request, the Court concluded the plaintiffs do not have a likelihood of success on the merits of their claims.