Federal Election Commission Main Page
October 6, 1980
RETURN RECEIPT REQUESTED
ADVISORY OPINION 1980-109
Steven R. Bailey
Attorney at Law
2408 Van Buren Avenue
Ogden, Utah 84401
Dear Mr. Bailey:
This responds to your letter dated September 19, 1980,
requesting an advisory opinion on behalf of James Hansen, a
candidate for the U.S. House of Representatives in the 1980
general election concerning application of the Federal Election
Campaign Act of 1971, as amended ("the Act"), and Commission
regulations to certain proposed activity in connection with
Mr. Hansen's campaign.
You state that The Ruff Times is a subscription periodical
published since 1975 by Target Publishers, Inc., of San Ramon,
California; it is not owned or controlled by any candidate,
political party or political committee. Further, you state
that The Ruff Times is published twice monthly and is mailed
to subscribers who pay $145 annually for the publication.
You state further that the content of this publication is
"primarily devoted to current political, economic, and social
events and how such events affect subscribers' investments and
personal finances." Each issue includes a commentary by
Mr. Ruff, and you indicate that Mr. Ruff wishes to devote one or
more of his commentaries prior to the 1980 general election to
"the subject of various races for federal offices, including
the campaign for U.S. Representative." Mr. Ruff has indicated,
you say, that he may endorse specific candidates in his commentary
including Mr. Hansen, and may urge his subscribers to
support such candidates with their votes and with contributions
to the candidates or to committees that support the candidates.
You ask specifically whether an endorsement of, including
a contribution solicitation on behalf of, Mr. Hansen in a
commentary written by Mr. Ruff in The Ruff Times would constitute
a contribution to Mr. Hansen by Mr. Ruff, The Ruff Times,
or by Target Publishers? The Commission concludes that a contribution
under the described circumstances would not result.
Under the Act, a "contribution" is defined as "any gift,
subscription, loan, advance, or deposit of money or anything
of value made by any person for the purpose of influencing any
election for Federal office...." However, the Commission's
regulations have exempted certain activity from the definition
of "contribution". 11 CFR 100.7(b)(2) provides that the term
"contribution" does not include "any cost incurred in covering
or carrying a news story, commentary, or editorial by any
broadcasting station, newspaper, magazine, or other periodical
publication... unless the facility is owned, or controlled by
any political party, political committee, or candidate...."
See also 2 U.S.C. SS 431(9)(B)(i). This exemption from the definition
of "contribution" is a limited exemption designed to
insure the right of the media to cover and comment on election
campaigns. See H.R. Rep. No. 93-1239, 93d Cong., 2d Sess. 4
(1974). The Commission has defined the phrase "periodical publication"
to mean "a publication in bound pamphlet form appearing
at regular intervals (usually either weekly, bi-weekly, monthly
or quarterly) and containing articles of news, information,
opinion or entertainment, whether of general or specialized
interest which ordinarily derive their revenues from subscriptions
and advertising." See, Explanation and Justification
of Candidate Debate Regulations, 44 Federal Register 76735
(December 27, 1979).
Accordingly, the proposed activity, that is, Mr. Ruff's
endorsement of Mr. Hansen, and solicitation of contributions
to his campaign in the commentary which appears as a regular
feature in each issue of The Ruff Times would be covered by
the news story exemption in 2 U.S.C. SS 431(9)(B)(i) and would
not result in a contribution to Mr. Hansen's campaign from Mr.
Ruff, The Ruff Times or from Target Publishers. This conclusion
is based on the assumption that the solicitation of contributions
will not involve any arrangement whereby either Mr. Ruff,
The Ruff Times, or Target Publishers would become a conduit or
intermediary for a contribution made by an individual contributor
to Mr. Hansen's campaign committee. Compare Advisory
Opinion 1980-46, copy enclosed. Thus, any solicitation for
contributions on behalf of Mr. Hansen made by Mr. Ruff in
his commentaries is within the cited exemption only if
individual contributors are merely instructed to forward their
contributions directly to Mr. Hansen or his campaign committee.
See 11 CFR 110.6.
Your letter also states that in the past, The Ruff Times
has permitted non-political advertisers to insert "separate
direct response marketing materials" in various issues of
the publication, provided that the advertiser pays a fee for
this service. All materials constituting such advertisements
must be paid for by the advertiser and are not financed by
The Ruff Times. You ask specifically whether the enclosure
in The Ruff Times of campaign advertising materials prepared
and paid for by Mr. Hansen's principal campaign committee
for a fee equal to (or in excess of) the fee which non-political
advertisers are normally charged by The Ruff Times, would
constitute a contribution to Mr. Hansen by Mr. Ruff, The Ruff
Times or Target Publishers?
The Commission concludes that no contribution from
Mr. Ruff, The Ruff Times or Target Publishers would result
under the proposed arrangement as long as the Hansen campaign
committee pays all costs in connection with the preparation
and printing of the campaign materials to be inserted into
copies of The Ruff Times and provided that the Hansen committee
pays the normal and usual fee which non-political advertisers
would ordinarily be charged for the same service. The Commission's
regulations define the phrase "normal and usual charge"
for services, other than those provided by an unpaid volunteer,
to mean "the hourly or piecework charge for the services at
a commercially reasonable rate prevailing at the time the
services are rendered." 11 CFR 100.7(a)(1)(iii)(B).
Thus, if the Hansen campaign committee is charged the normal
and usual rate (and pays such amount) for inserting the campaign
materials supplied by Mr. Hansen's committee, no contribution
to the Hansen committee results from either Mr. Ruff,
The Ruff Times or Target Publishers. See Advisory Opinions
1978-34, 1978-45, copies enclosed.
This response constitutes an advisory opinion concerning
application of the Act, or regulation prescribed by the Commission,
to the specific transaction or activity set forth
in your request. See 2 U.S.C. SS 437f.