Requested by: Robert Colaco, National Chairman
On Behalf of: Citizens for a Better America
Prepared by: Jenifer Kohout, Assistant Director
Date issued: September 1, 1998
Subject: Activities by Out of State Organization
This letter responds to the July 17 and July 20, 1998 requests for an advisory opinion regarding the activities of the Citizens for a Better America (CBA), an organization based outside Alaska.
The constitutionality of the 1996 amendments to the Campaign Disclosure Law were recently challenged in court. On August 10, 1998, the 1996 amendments were declared unconstitutional by the superior court. However, on August 14, 1998, the Alaska Supreme Court issued a stay of the lower courts decision pending the decision on appeal. A final ruling by the Supreme Court on this matter may invalidate some or all of this advice.
Based on your conversation with staff and subsequent correspondence, we understand that you wish the Commission to answer the question of whether the activities you have proposed under program #1 and program #2 of your materials are permissible under the campaign disclosure law now in effect.
Unless the CBA satisfies all the statutory filters on groups who wish to be active in Alaska campaigns, it may not make contributions to or independent expenditures on behalf of Alaskan candidates. This restriction would mean that CBA could not endorse Alaska candidates and distribute those endorsements outside CBAs membership.
CBA may sell copies of its "Have you been lied to?" flyer to endorsed candidates at fair market value. However, it may not give them to candidates.
Contribution Limitations on Out of State Organizations
AS 15.072(a)(3). Restrictions on solicitation and acceptance of contributions. Candidates may not solicit or accept a contribution from a group organized under the laws of another state, resident in another state, or whose participants are not residents of this state at the time the contributions is made.
Limitation on Independent Expenditures by Out of State Organizations
AS 15.13.135. Only an individual or group may make an independent expenditure supporting or opposing a candidate for election to public office.
Definition: AS 15.13.400(5). A group is any combination of two or more individuals who take joint action to influence the outcome of an election.
Nonresident Contributions to Groups: AS 15.13.072(f). A group may not accept more than 10 percent of its total contributions from individuals who are not residents of Alaska.
Group Contribution Limits and Restrictions: AS 15.13.070, 074(f). Only individuals and groups may contribute to groups. A corporation, company, partnership, firm, association, organization, business trust or surety, labor union or publicly funded entity may not contribute to a group.
An individual may not contribute more than $500 per year to a group; a group may not contribute more than $1000 per year to a candidate.
The Citizens for a Better America (CBA) materials state that the CBA is a "national, grassroots, independent, non-connected political committee" based in Van Nuys, California. CBA members pay $60 per year in dues.
Because organization founders wanted to be free to endorse candidates and advocate on their behalf, they registered the organization with the Federal Election Commission as a non-connected political committee. As a result, CBA is subject to federal contribution limitations including a prohibition on corporate money and on contributions over $5,000.
CBA materials indicated that the aim of CBA is to endorse and support candidates across the country who the organization identifies as "worthy to be voted for."
Based upon staffs review of your materials, it appears that CBA offers two levels of support to selected candidates. The first level is identified as program #1. At this stage, candidates are requested to complete a questionnaire asking them about a range social and economic issues. Based on the candidates responses, CBA decides whether or not to endorse the candidate. Endorsed candidates appear on CBAs "Good Guys List" (candidate list). CBA disseminates its endorsements in several ways. First, it produces a news release. The release announces the names of the CBA endorsed candidates in that state. CBA sends the news release to its "Commentary and News Release List." The News Release List consists of "news media, political organizations, churches, individuals, and the candidates that have provided CBA with their fax numbers or email addresses." Second, CBA posts the candidate list on its website. Third, CBA includes the candidate list in its "Have you been lied to?" flyer. Finally, candidates are free to reproduce the endorsement themselves.
If a candidate endorsed by CBA chooses, he or she may participate in "program #2." At this level, CBA permits the candidate to purchase copies of CBAs "Have you been lied to?" flyer. The flyer was first developed by Mr. Colaco during a 1992 race for Congress. It contains articles about various issues and a copy of the "Good Guys List." CBA provides a price list and tips on distributing the flyers to candidates who are interested in using the flyer in their campaigns.
If an endorsed candidate is unable to pay for the flyers, he or she may provide CBA with a mailing list sufficient to raise enough funds to cover the cost of printing. Under this arrangement, CBA calls individuals on the candidates mailing list. CBA informs individuals that it is seeking money to assist the candidates campaign through the publication of the flyer. Individuals are asked to pay $5 a month or $60 per year to become a member of CBA. Once CBA obtains sufficient pledges, it pays for the printing of the flyers.
Candidates are responsible for distributing the flyers although CBA offers some support by keeping track of individuals who have agreed to volunteer for the candidate.
From the materials you have submitted, it is not clear what percentage of your members are Alaska residents. Nor is it clear whether CBA has accepted contributions that would be prohibited under Alaska lawfor example, because they are over $500 or are from corporations, companies, partnerships, firms, associations, organizations, business trusts or sureties, labor unions or publicly funded entities.
Only individuals and groups may make contributions to or independent expenditures for or against candidates. While CBA appears to meet the broad definition of "group" under the campaign disclosure law, it is not clear that the CBA satisfies the other filters that apply to Alaska groups. Specifically, Alaska groups may not accept more than 10% of their total income from nonresident individuals; may not accept more than $500 from any single individual; and may not accept contributions from corporations, unions, associations, partnerships, or other organizations. If the CBA fails to meet any one of these filters, it would be prohibited from making contributions or independent expenditures for or against candidates.
Even if the CBA failed to satisfy the statutory filters described above, it would be permitted to distribute its "Good Guys List" if it met the requirements of 2 AAC 50.313(l)(4). That regulation permits an organization to communicate directly with its members without triggering a prohibited contribution if the communication is of the same nature and format as prior nonpolitical communication, encourages voting only, and does not solicit contributions. According to CBAs materials, however, new releases with portions of the candidate list are sent to "news media, political organizations, churches, individuals, the candidates that have given [CBA] their fax numbers and or email addresses." Thus, because the candidate list is sent outside the CBA membership, it is not permitted under this regulation.
Under this arrangement, endorsed candidates may arrange to obtain copies of the "Have you been lied to?" flyer. First developed by CBAs chairman during a Congressional race, the flyer consists of various articles and a list of endorsed candidates.
A candidate may obtain copies of the flyer one of two ways. First, he or she may simply purchase the flyer. If CBA sells copies of the flyer to a candidate at fair market value, then the candidate has simply made a campaign expenditure. No prohibited contribution from CBA results. The candidate receiving copies of the flyer must simply disclose the expenses associated with purchasing the copies.
A candidate could provide CBA with a contact list and CBA may solicit new members to help cover the cost of the flyers. However, CBA may not give printed copies of the flyers to the candidate. The candidate must pay fair market value for the printing.
If the CBA fails to meet the statutory filters of the Alaska campaign disclosure law, it is prohibited from distributing its list of endorsed candidates outside of its membership.
CBA may sell, at fair market value, copies of its flyer "Have you been lied to?" to candidates who wish to distribute them to their constituents. However, CBA is prohibited from giving copies of the flyer to candidates.
The Commission approved this advisory opinion on March 24, 1999. The advice in this opinion applies only to the specific activity for which the advice was requested.
A copy of the original letter requesting the above advisory opinion is available upon request at the Alaska Public Offices Commission. 907/276-4176.