June 27, l990
Mrs. H. Alfred Dunn
California Federation Republican Women
3238 E. Villa Knolls Drive
Pasadena, CA 91107
Re: Your Request For Advice
Our File No. A-90-379
Dear Mrs. Dunn:
You have requested advice on behalf of the California Federation of Republican Women under the campaign provisions of the Political Reform Act (the Act).
QUESTION
For purposes of the Act's contribution limitations, are the Federation clubs "persons" or "political committees"?
CONCLUSION
If a Federation club meets the definition of a recipient committee, it will be either a "political committee" or a "broad based political committee" for purposes of the contribution limitations.
FACTS
The Federation receives membership dues which are used to accomplish the Federation's goals of informing the public through education and activity. Funds are not raised for the purpose of making campaign contributions. However, some of the Federation's clubs do make contributions from the dues payments they receive.
ANALYSIS
A membership organization, such as the Federation clubs, meets the definition of a "recipient committee" under the Act if it receives contributions totalling $l,000 or more during a calendar year. (Section 820l3(a).)
Section 820l5 defines "contribution," and Regulation l82l5 further explains the types of payments that meet the definition of "contributions."
With regard to membership dues, or other receipts that are intended for a purpose other than making campaign contributions or expenditures, Regulation l82l5 provides that such payments are "contributions" if they are "earmarked" for making contributions or expenditures. Regulation l82l5 provides that a payment is "earmarked" when:
At the time of making the payment, the donor knows
or has reason to know that the payment or funds with
which the payment will be commingled will be used to
make contributions ... or expenditures....
When an organization, such as the Federation or the individual Federation clubs, uses membership dues to make campaign contributions or expenditures, the portion of the dues which is used to make contributions or expenditures is deemed to be "earmarked" once the members are on notice that a portion of their dues may be used for political purposes. Members are deemed to be on notice that a portion of their dues may be used for making campaign contributions or expenditures if the organization has used the funds for that purpose in a previous year. The enclosed information sheet entitled "Organizations Which Are Formed Primarily For Purposes Other Than Making Contributions And Expenditures To Support Or Oppose California State Or Local Candidates" explains this in detail.
A club which qualifies as a recipient committee must determine whether it is a "political committee" or a "broad based political committee" for purposes of the contribution limitations.
"Political committee" means:
A committee of persons who receives contri-
butions from two or more persons and acting
in concert makes contributions to candidates.
(Section 85l02(c).)
"Broad based political committee" means:
A committee of persons which has been in
existence for more than six months, receives
contributions from one hundred or more persons,
and acting in concert makes contributions to
five or more candidates.
(Section 85l02(d).)
The enclosed "Information Manual On Campaign Disclosure Provisions Of The Political Reform Act For General Purpose Recipient Committees" sets out the limitations on the amount of contributions which may be made and which may be received by political committees and broad based political committees.
The Act's limitations do not apply to contributions received by a political committee or a broad based political committee when such contributions are used for purposes other than making contributions to candidates. If a committee wishes to receive contributions above the limits for this purpose, a separate bank account must be established. It is not necessary for a committee to establish a separate campaign account unless contributions which exceed the limitations are received. Enclosed is a copy of Regulation l8535 which sets forth the conditions under which a committee may accept contributions in excess of the Act's contribution limits.
Please call me at (9l6) 322-5662 if you have any questions.
Sincerely,
Scott Hallabrin
Acting General Counsel
By: Jeanne Pritchard
Chief, Technical Assistance
And Analysis Division
Enclosures