[Federal Register Volume 65, Number 70 (Tuesday, April 11, 2000)]
[Proposed Rules]
[Pages 19339-19345]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-8884]


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 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 65, No. 70 / Tuesday, April 11, 2000 / 
Proposed Rules  

[[Page 19339]]



FEDERAL ELECTION COMMISSION

11 CFR Parts 101, 102, 104, 109, 114, 9003, and 9033

[Notice 2000-7]


Electronic Filing of Reports by Political Committees

AGENCY: Federal Election Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Election Commission is seeking comment on proposed 
rules to implement a mandatory electronic filing system for reports of 
campaign finance activity filed with the agency. Political committees 
and other persons would be required to file electronically when either 
their total contributions or total expenditures within a calendar year 
exceed $50,000. The Commission has had a voluntary electronic filing 
system in place since 1996. Voluntary electronic filing would still be 
an option for political committees and persons who do not exceed the 
$50,000 threshold. This mandatory system is designed to reflect recent 
changes in the Federal Election Campaign Act of 1971. Please note that 
the draft rules that follow do not represent a final decision by the 
Commission on the issues presented by this rulemaking. Further 
information is provided in the supplementary information that follows.

DATES: Comments must be received on or before May 11, 2000.

ADDRESSES: All comments should be addressed to Rosemary C. Smith, 
Assistant General Counsel, and must be submitted in either written or 
electronic form. Written comments should be sent to the Federal 
Election Commission, 999 E Street, NW, Washington, DC 20463. Faxed 
comments should be sent to (202) 219-3923, with printed copy follow-up 
to insure legibility. Electronic mail comments should be sent to 
[email protected]. Commenters sending comments by electronic mail 
should include their full name, electronic mail address and postal 
service address within the text of their comments. Comments that do not 
contain the full name, electronic mail address and postal service 
address of the commenter will not be considered. The Commission will 
make every effort to have public comments posted on its web site within 
ten business days of the close of the comment period.

FOR FURTHER INFORMATION CONTACT: Ms. Rosemary Smith, Assistant General 
Counsel, or Cheryl Fowle, Attorney, 999 E Street, NW, Washington, DC 
20463, (202) 694-1650 or (800) 424-9530.

SUPPLEMENTARY INFORMATION: On September 29, 1999, Public Law 106-58 
amended the Federal Election Campaign Act of 1971 (``the Act'' or 
``FECA'') to require, inter alia, that the Commission draft rules 
requiring persons who are required to file reports, designations or 
statements with the agency to ``maintain and file a designation, 
statement or report for any calendar year in electronic form accessible 
by computers if the person has, or has reason to expect to have, 
aggregate contributions or expenditures in excess of a threshold amount 
determined by the Commission * * *'' 113 Stat. 476 (1999). The new law 
requires this system to be in place for reports covering periods after 
December 31, 2000.
    The new law also requires the Commission to amend its regulations 
to add a system of administrative fines for violations of reporting 
requirements and to require candidates and their authorized committees 
to aggregate and report data on an election cycle-to-date rather than a 
calendar year-to-date basis. These two topics are being addressed in 
two separate rulemakings.
    Current Commission regulations at 11 CFR 104.18 invite committees 
to voluntarily file electronically regardless of their level of 
financial activity. The new law maintains the voluntary system for 
political committees or persons who do not exceed, or who do not have 
reason to expect to exceed, the threshold of financial activity.
    The goals of the electronic filing system include more complete and 
rapid on-line access to reports on file with the Commission, reduced 
paper filing and manual processing, and more efficient and cost-
effective methods of operation for filers and for the Commission. The 
amendment to the FECA requires that the Commission make electronically 
filed reports, designations or statements available on its web site not 
later than 24 hours after the Commission receives the filing. 
Currently, reports that are filed under the voluntary system of 
electronic filing are posted in viewable form on the Commission's web 
site within five minutes and detailed data are available in the 
Commission's databases within 24 to 48 hours (depending on the time of 
receipt). In contrast, under the current paper filing system, the time 
between receipt of a report and its appearance in viewable form on the 
Commission's web site is 48 hours. Additionally, while some summary 
data is available in the Commission's indexes within 48 hours, it can 
take as long as 30 days before the detailed data filed on paper is 
available in those databases. Thus, the greater the number of pages 
that are filed electronically, the greater the volume of data that is 
almost instantly available. Additionally, decreasing the volume of 
paper filed will decrease the processing time of the reports that are 
filed on paper, making them more rapidly available in the Commission's 
databases.
    Before such a system for mandatory electronic filing can be 
successfully implemented, two main factors must be considered. First, 
what is the optimal threshold that maximizes the disclosure benefits of 
electronic filing yet does not encumber the regulated community? 
Second, what are the technical and formatting requirements for 
electronically filed reports? The Commission seeks comments on both of 
these concerns.

Threshold

    Proposed paragraph (a) of 11 CFR 104.18 states that political 
committees and other persons who are required to file with the agency 
must file electronically if they have, or have reason to expect to 
have, aggregate contributions or expenditures exceeding $50,000 in a 
calendar year.
    The Commission proposes $50,000 as the appropriate threshold for 
all political committees and other persons because, as discussed below, 
data from the 1996 and 1998 election cycles \1\

[[Page 19340]]

indicate that at that threshold, the goals of the statutory amendment 
are optimized and the effect on the political committees and other 
persons is minimized.
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    \1\ Please note that the data used to calculate these 
percentages are approximated from the Commission's databases. For 
the purpose of determining the appropriate threshold, the following 
approximations were used: For authorized committees: Contributions 
are the total of individual contributions plus party contributions 
plus other committee contributions plus candidate contributions plus 
candidate loans; and expenditures were considered to be operating 
expenditures. For unauthorized committees: Contributions consist of 
total receipts minus nonfederal transfers in; and expenditures are 
equal to total disbursements minus the nonfederal share of 
expenditures.
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A. Candidates and Authorized Committees

    Under the proposed rules, candidates and their authorized 
committees who file with the agency would be required to file 
electronically if they have, or have reason to expect to have, 
aggregate contributions or expenditures exceeding $50,000 in a calendar 
year.
    Data from the 1996 and 1998 election cycles show that this 
threshold would make 96% to 98% \2\ of all financial activity reported 
by House and Presidential campaign committees almost immediately 
available on both the FEC's web site and in the agency's on-line 
databases. The historical information shows that of the 1,837 to 2,231 
authorized committees filing with the Commission between 1995 and 1998, 
31% to 44% of the committees (599 to 982 committees) had aggregate 
contributions or expenditures exceeding $50,000. These authorized 
committees filed 43% to 73% of the reports (2,162 to 12,646 reports), 
and 73% to 88% (66,569 to 282,339 pages) of the total number of pages 
filed by authorized committees. If 73% to 88% of the total number of 
pages filed by authorized committees is filed electronically, the 
Commission can manually process the remaining 12% to 29% of the pages 
more quickly to substantially reduce the amount of time before the 
information is available in Commission databases.
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    \2\ Because the data was taken over a period of two election 
cycles that included a Presidential-election year (1996), a midterm 
election year (1998) and two non-election years (1995 and 1997), the 
number of committees, reports and pages filed and financial figures 
vary--increasing in election years, descreasing in non-election 
years. The percentages and numbers used in this document are the 
high and low figures of the four year span. Please note that the 
high or low percentage may have come from one year and the high or 
low actual number may have come from a different year.
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    The amendments to the FECA require that those who meet the 
threshold must file ``designations, statements or reports'' 
electronically. Therefore, under the proposed regulations, any 
candidate who expects to have aggregate contributions or expenditures 
exceeding $50,000 would be required to electronically file his or her 
Statement of Candidacy (FEC Form 2), and his or her authorized 
committee would be required to file its Statement of Organization (FEC 
Form 1) electronically. Additionally, under the proposed rules, all 
committees that have Internet web sites would be required to provide 
the address of their web sites as part of their address on Form 1. 
Committees that are required to file electronically, and that have 
electronic mail addresses, would be required to include their 
electronic mail addresses as part of the address on Form 1.
    Please note, however, that the mandatory electronic filing 
provisions of Public Law 106-58 and new paragraph (a) of 11 CFR 104.18 
apply only to those candidates and authorized committees who are 
required to file reports, statements and designations with the FEC. 
Therefore, mandatory electronic filing does not apply to candidates for 
United States Senate because Senate candidates must file with the 
Secretary of the Senate. Senate candidates are, however, invited to 
electronically file an unofficial copy of their reports, designations 
and statements with the FEC for the purposes of faster disclosure.
    Furthermore, under current Commission regulations, as a condition 
of receiving public funding Presidential candidates are required to 
agree to file electronically if their data is computerized. 11 CFR 
9003.1(b)(11) and 9033.1(b)(13). In order for primary candidates to 
receive matching funds, they must raise $100,000 ($5,000 in each of 20 
states). The Commission proposes removing electronic filing as a 
condition for receiving public funding because these federally financed 
Presidential candidates will already have exceeded the $50,000 
threshold and will already be filing electronically. Consequently, 11 
CFR 9003.1(b)(11) and 9033.1(b)(13) would be deleted.
    If a $50,000 threshold is adopted, the effect on candidates and 
authorized committees would be minimal since, based on the 1996 and 
1998 election cycle data, only the largest 30% to 40% of registered 
authorized committees would be required to file electronically.

B. Party Committees

    The Commission is proposing that party committees be required to 
file electronically if they have, or have reason to expect to have, 
aggregate contributions or expenditures exceeding $50,000 in a calendar 
year.
    At the $50,000 level, historical data from the 1996 and 1998 
election cycles show that of the 373 to 451 party committees filing 
with the Commission, 36% to 41% of them (142 to 182 committees) 
consistently disclosed over 99% (between $213 million and $459 million) 
of party activity. Of the total number of pages filed by party 
committees, 93% to 96% (71,598 to 210,242 pages) would have been filed 
electronically, thereby greatly decreasing the amount of paper 
processing by the committees and the FEC and considerably increasing 
the amount of data that would be almost immediately available.
    Based on the 1996 and 1998 election cycle data, the impact on party 
committees should be relatively small since only 36% to 41% of all 
party committees registered with the Commission during those election 
cycles would have been required to file electronically. Thus, the 
smallest 59% to 64% of party committees could continue to file paper 
reports.

C. Nonconnected Committees

    The Commission is proposing that nonconnected committees be 
required to file electronically if they have, or have reason to expect 
to have, aggregate contributions or expenditures exceeding $50,000 in a 
calendar year.
    At the $50,000 level, in the 1996 and 1998 election cycles, of the 
840 to 933 nonconnected committees filing with the Commission, 15% to 
22% of them (128 to 202 committees) disclosed 88% to 93% of the 
activity by nonconnected committees (representing approximately $29 
million to $65 million of the total $33 million to $70 million 
disclosed by nonconnected committees). Additionally at that level, 59% 
to 68% (16,794 to 44,907 pages) of the total number of pages filed by 
nonconnected committees would have been filed electronically, causing a 
significant decrease in paper processing and a corresponding increase 
in the amount of data more rapidly disclosed.
    The number of nonconnected committees affected should be relatively 
small since the historical data from the 1996 and 1998 election cycles 
show that only the largest 15% to 22% of the nonconnected committees 
registered with the Commission would have been required to file 
electronically.

D. Separate Segregated Funds

    The Commission is proposing that the separate segregated funds 
(SSFs) of corporations and labor organizations be required to file 
electronically if they have, or have reason to expect to have, 
aggregate contributions or expenditures exceeding $50,000 in a calendar 
year.
    At the $50,000 level, in the 1996 and 1998 election cycles, of the 
2,938 to 2,976 SSFs registered with the Commission, 22% to 28% of them 
(632

[[Page 19341]]

to 825 committees) disclosed 85% to 89% ($138 million to $211 million) 
of the total SSF financial activity. This represents 63% to 68% 
(between 94,670 and 110,864 pages) of the total number of pages filed 
by SSFs. Based on historical data, the decrease in the amount of paper 
filed would represent approximately 100,000 pages of data and hundreds 
of millions of dollars available almost instantly on the Commission's 
web site and in the agency's databases.
    The impact on SSFs should be small considering that, in the 1996 
and 1998 election cycles, only 22% to 28% of all SSFs registered with 
the Commission would have been required to file electronically. Thus, 
the smallest 72% to 78% (approximately 2,300 committees) of SSFs would 
continue to have the option of filing paper reports.

E. Other Persons

    The amendment to the FECA requires that ``a person'' who is 
required to file under the Act must file electronically if he or she 
exceeds, or has reason to expect to exceed, the threshold. Therefore, 
in addition to the committees discussed above, the Commission proposes 
to apply the $50,000 threshold to any other persons defined in 11 CFR 
110.10 who are required to file a ``designation, statement or report'' 
with the Commission (e.g., individuals making independent expenditures 
in excess of $50,000, or corporations or labor organizations making 
communications to their restricted classes at a cost of more than 
$50,000). Thus, under the proposed rules, these other persons would be 
required to file electronically if they have, or have reason to expect 
to have, aggregate contributions or expenditures exceeding $50,000 in a 
calendar year.
    Data from the 1996 and 1998 election cycles show that the between 
7% and 19% (between 2 and 24 persons) of other persons filing with the 
Commission had aggregate contributions or aggregate expenditures 
exceeding $50,000 in a calendar year. During that four year period, 
those persons who exceeded the threshold accounted for 33% and 50% of 
all activity by other persons in the non-election years, and as high 
94% of all activity by other persons in the Presidential election year 
and 91% in the midterm election year.
    The effect of the proposed rule on this category of filer should be 
small because historical data show that the number of these other 
filings is very small. For example, in the 1995 and 1997 (the non-
election years), only two of 28 and 23 filers (less than 10% in each 
case), respectively, would have been required to file electronically 
under the proposed rules. In 1996 and 1998 (1996 being a Presidential 
election year), the total numbers of filers who would have been 
affected were 24 of 128 filers (19%) and 13 of 75 filers (17%), 
respectively.

F. All Committees

    The historical data for the 1996 and 1998 election cycles show that 
if a $50,000 mandatory electronic filing threshold had been in place at 
that time, hundreds of thousands of pages would have been filed 
electronically, dramatically decreasing the amount of paper processed 
by both committees and the Commission. Additionally, the amount of 
financial data that would have been almost instantly disclosed by 
electronic filing would have been between $544 million and $1.2 
billion.
    Please note that the amendments to the FECA require that those who 
meet the threshold must file ``designations, statements or reports'' 
electronically. Therefore, under the proposed regulations, committees 
that have reason to expect to have aggregate contributions or 
expenditures exceeding $50,000 would be required to electronically file 
their Statements of Organization (Form 1). Additionally, under the 
proposed rules, all committees that have official web sites would be 
required to include the Internet address of their web sites as part of 
their address on Form 1. Committees that are required to file 
electronically and that have electronic mail addresses would be 
required to provide their electronic mail addresses as part of the 
address on Form 1.
    The Commission seeks comments on thresholds both lower and higher 
for all committees and other persons. For example, should there be 
different thresholds for different types of committees? Should there be 
only one threshold but at a level different than that proposed? Should 
separate segregated funds of corporations and labor organizations have 
a lower threshold because their administrative and solicitation costs 
may be paid by their connected organization?

G. Joint Fundraising Representatives

    The Commission proposes that joint fundraising representatives (see 
11 CFR 102.17) be required to file electronically if they have, or have 
reason to expect to have, total contributions or total expenditures 
exceeding the $50,000 threshold. Thus, if, for example, a joint 
fundraiser raises total contributions of $65,000 that it divides 
equally between the three participating committees, including itself, 
the joint fundraising representative would be required to file 
electronically.

H. ``Have Reason To Expect To Have Aggregate Contributions or 
Expenditures'' Above the Threshold

    The Commission requests comments on how to implement the statutory 
requirement that persons file electronically if they ``* * * have 
reason to expect to have * * *'' aggregate contributions or 
expenditures above the threshold amount. Two tests that are included in 
the proposed rules at 11 CFR 104.18(a)(3) are--(1) a committee should 
expect to have financial activity above the $50,000 threshold if it 
exceeded this amount during the comparable year of the previous 
election cycle; or (2) a committee should expect to have financial 
activity exceeding the threshold if the committee's aggregate 
contributions or expenditures exceeded the threshold during the 
previous calendar year.
    Comments are sought on three other possible approaches that are not 
included in the proposed rules--(1) Should the Commission base the 
expectation solely on the committee's or person's own projections 
during the year? If so, at what point during the year will political 
committees and other persons be expected to make the projection? Should 
it be a one-time forecast at the beginning of the year or a rolling 
projection that changes as necessary throughout the calendar year? (2) 
Should new committees having no historical data on which to base a 
projection, base their expectations of aggregate contributions and 
expenditures on historical data for similarly situated committees in 
the previous election cycle; or should such new committees be presumed 
to have no reason to expect to exceed the threshold until such time as 
they actually do so? (3) Should a committee have reason to expect to 
exceed the threshold if it raises or spends more than one quarter of 
the proposed yearly threshold in the first calendar quarter, or if it 
raises or spends more than half the threshold in the first half of the 
calendar year? For example, should a committee be required to file 
electronically if it raises $30,000 in the first calendar quarter on 
the grounds that it has reason to expect to exceed the $50,000 
threshold within the calendar year?

I. Cash on Hand and Outstanding Debt

    The Commission proposes that for purposes of the contribution and 
expenditure thresholds, cash on hand or debt that is outstanding at the 
beginning of the calendar year would not be

[[Page 19342]]

included. Thus, the calculation in the proposed rules that follow takes 
into account only those contributions received or expenditures made, or 
expected to be received or made, within the calendar year.

J. Filing for the Calendar Year

    The statutory amendment to the Act requires that persons who are 
required to file with the Commission must ``maintain and file a 
designation, statement or report for any calendar year in electronic 
form accessible by computers if the person has, or has reason to expect 
to have, aggregate contributions or expenditures in excess of a 
threshold amount determined by the Commission * * *'' 113 Stat. 476 
(1999). The Commission seeks comments on whether the threshold should 
be calculated on a ``per election cycle basis'' rather than on the 
proposed ``per calendar year'' basis. If so, should an election cycle 
threshold be used for authorized committees only or for all committees 
and other persons? Please note that for House candidates, the election 
cycle will generally cover approximately two years, while it may extend 
to over four years for Presidential candidates. See 11 CFR 100.3(b).
    The proposed amendments to 11 CFR 104.18 would not require persons 
to electronically refile any reports, statements or designations that 
were properly filed on paper earlier in the calendar year or earlier in 
the election cycle. For example, if an authorized committee files its 
April quarterly report on paper because it has not exceeded and does 
not expect to exceed the appropriate threshold and, if in June it 
exceeds the $50,000 threshold, the committee would have to 
electronically file its July quarterly report, but would not be 
expected to go back and electronically refile the April report.
    In the current voluntary electronic filing regulations at 11 CFR 
104.18(a), electronic filers are required to continue filing 
electronically for the remainder of the calendar year unless the 
Commission determines that an extraordinary and unforeseen circumstance 
makes electronic filing impracticable. The Commission seeks comment on 
whether a similar provision allowing a committee or other person to 
stop filing electronically within the calendar year due to 
extraordinary and unforeseen circumstances should be included in the 
proposed rules for mandatory electronic filers.

Technical Issues

A. Computerization of Data and FECFile Software

    The Commission's computer systems are capable of receiving all 
reports that might be required under the proposed regulations. However, 
the Commission's FECFile software, which is available from the agency 
at no cost, does not currently generate all required forms. For 
example, the FECFile software does not currently generate FEC Forms 1 
and 2 (Statement of Organization and Statement of Candidacy, 
respectively), FEC Form 3P for Presidential candidates, FEC Form 4 for 
Convention and Host Committees to report their receipts and 
disbursements, FEC Form 5 for persons other than political committees 
reporting independent expenditures, or FEC Form 7 for reporting 
corporate and labor organization communications to their restricted 
classes. The Commission plans to update the FECFile software to 
generate FEC Forms 1 and 2 by January 1, 2001, and anticipates that 
FECFile will generate FEC Forms 3P, 4, 5 and 7 in the near future.
    The Commission seeks comments as to whether those committees filing 
comments on this rulemaking currently use a computer to maintain 
records, prepare reports, and/or file reports. In particular, would the 
filing threshold established by the proposed rules necessitate the 
purchase of computer hardware?

B. Formatting and Standardization Requirements

    The Commission proposes to maintain the standardization 
requirements that are present in the current voluntary electronic 
filing system. When the voluntary electronic filing system was 
designed, the Commission created ``The Federal Election Commission's 
Electronic Filing Specifications Requirements'' (EFSR) document and 
invited comment on that document at that time. The EFSR is available at 
no charge on the Commission's web site. The Commission is currently 
updating the EFSR and intends to use specifications embodied in the 
updated EFSR for this mandatory electronic filing program. The 
Commission again requests comment on the EFSR from software vendors and 
other interested parties based on their experience with the voluntary 
electronic filing system. Commenters should submit their comments on 
the EFSR in the manner requested in the ADDRESSES section of this 
notice. Technical comments on the EFSR will be forwarded to the Data 
Systems Development Division.
    Please note that the validation program that checks incoming 
reports is also being updated. For example, upon completion of this 
update, the program will no longer accept forms on which the figures 
disclosed within the report do not add up to the figures reported on 
the detailed summary page and forms indicating the incorrect type of 
report.

Additional Issues

A. Filing by Letter

    Proposed changes to the Commission's regulations would require that 
some statements required by the Act that can currently be filed by 
letter must be electronically filed using the proper FEC form when the 
threshold has been exceeded or is expected to be exceeded. The 
statements that would be affected are: (1) The Statement of Candidacy, 
FEC Form 2 (11 CFR 101.1(a)); (2) Amendments to the Statement of 
Organization, FEC Form 1 (11 CFR 102.2(a)(2)); (3) Individuals 
reporting independent expenditures,\3\ FEC Form 5 (11 CFR 109.2); and 
(4) Qualified Nonprofit Corporations reporting independent 
expenditures,\4\ FEC Form 5 (11 CFR 109.2 and 114.10(e)). The 
Commission proposes adding language to clarify that only those 
committees and other persons who are not required to file 
electronically under the proposed regulations may file these statements 
by letter. Currently, FEC Forms 1, 2 and 5 are not available on FECFile 
software. But see ``Technical Issues,'' above. The Commission requests 
comments on this proposed change.
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    \3\ Note that, under 11 CFR 104.4(c) and 105.4, independent 
expenditures in favor or opposing candidates for the U.S. Senate 
must be filed with the Secretary of the Senate and, therefore, would 
not be subject to this proposed regulation.
    \4\ Ibid.
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B. Non-filers

    The statute makes electronic filing mandatory for those persons who 
exceed or who expect to exceed the threshold set by the Commission. 
Consequently, political committees and other persons who are required 
to file electronically, but who fail to do so, may be subject to the 
Commission's enforcement process for non-filers and may have their 
names published as non-filers. This includes those who are required to 
file electronically but who file paper reports instead. Additionally, 
in 1999, Congress amended 2 U.S.C. 437g(a)(4) and (6)(A) to authorize 
the Commission to impose an administrative fine on late and non-

[[Page 19343]]

filers pursuant to a fine schedule. The Commission is in the process of 
developing a new program to implement the amendment.

C. Comments From Other Federal, State and Local Jurisdictions

    Finally, the Commission is interested in the experience of other 
Federal, state and local jurisdictions that have implemented a 
financial threshold based mandatory electronic filing program. What 
issues were considered in setting the threshold amounts? What were the 
potential and real barriers to the committees affected?

D. Conclusion

    The Commission welcomes comments on any other issues raised by the 
new statutory requirements regarding mandatory electronic filing.

Certification of No Effect Pursuant to 5 U.S.C. 605(b) (Regulatory 
Flexibility Act)

    These proposed rules if promulgated, will not have a significant 
economic impact on a substantial number of small entities. The basis of 
this certification is that the Commission's proposed thresholds are set 
at a sufficiently high level that most, if not all, small political 
committees would not be required to file electronically, although they 
could continue to do so voluntarily. In the event any small committees 
do exceed the proposed threshold, the economic impact would not be 
significant because the committees may obtain the FECFile software from 
the Commission at no cost, and the Commission anticipates this software 
will generate all required forms.

List of Subjects

11 CFR Part 101

    Political candidates, Reporting and recordkeeping requirements.

11 CFR Part 102

    Political committees and parties, Reporting and recordkeeping 
requirements.

11 CFR Part 104

    Campaign funds, Political committees and parties, Reporting and 
recordkeeping requirements.

11 CFR Part 109

    Elections, Reporting and recordkeeping requirements.

11 CFR Part 114

    Business and industry, Elections, Labor.

11 CFR Part 9003

    Campaign funds, Reporting and recordkeeping requirements.

11 CFR Part 9033

    Campaign funds, Reporting and recordkeeping requirements.
    For the reasons set out in the preamble, subchapters A, E and F of 
chapter I of title 11 of the Code of Federal Regulations would be 
amended as follows:

PART 101--CANDIDATE STATUS AND DESIGNATIONS (2 U.S.C. 432(e))

    1.The authority citation for part 101 would be revised to read as 
follows:

    Authority: 2 U.S.C. 432(e), 434(a)(11), 438(a)(f).

    2. Section 101.1 would be amended by revising paragraph (a) to read 
as follows:


Sec. 101.1  Candidate designations (2 U.S.C. 432(e)(1)).

    (a) Principal campaign committee. Within 15 days after becoming a 
candidate under 11 CFR 100.3, each candidate, other than a nominee for 
the office of Vice President, shall designate in writing a principal 
campaign committee in accordance with 11 CFR 102.12. A candidate shall 
designate his or her principal campaign committee by filing a Statement 
of Candidacy on FEC Form 2, or, if the candidate is not required to 
file electronically under 11 CFR 104.18, by filing a letter containing 
the same information (that is, the individual's name and address, party 
affiliation and office sought, the District and State in which Federal 
office is sought, and the name and address of his or her principal 
campaign committee) at the place of filing specified at 11 CFR part 
105. Each principal campaign committee shall register, designate a 
depository and report in accordance with 11 CFR parts 102, 103 and 104.
* * * * *

PART 102--REGISTRATION, ORGANIZATION AND RECORDKEEPING BY POLITICAL 
COMMITTEES (2 U.S.C. 433).

    3. The authority citation for part 102 would be revised to read as 
follows:

    Authority: 2 U.S.C. 432, 433, 434(a)(11), 438(a)(8), 441d.

    4. Section 102.2 would be amended by revising paragraphs (a)(1)(vi) 
and (a)(2), and adding (a)(1)(vii) to read as follows:


Sec. 102.2  Statement of organization: Forms and committee 
identification number (2 U.S.C. 433(b), (c)).

    (a)(1) * * *
    (vi) A listing of all banks, safe deposit boxes, or other 
depositories used by the committee;
    (vii) The Internet address of the committee's official web site, if 
such a web site exists. If the committee is required to file 
electronically under 11 CFR 104.18, its electronic mail address, if 
such an address exists.
    (2) Any change or correction in the information previously filed in 
the Statement of Organization shall be reported no later than 10 days 
following the date of the change or correction by filing an amended 
Statement of Organization or, if the political committee is not 
required to file electronically under 11 CFR 104.18, by filing a letter 
noting the change(s). The amendment need list only the name of the 
political committee and the change or correction.
* * * * *

PART 104--REPORTS BY POLITICAL COMMITTEES (2 U.S.C. 434)

    5. The authority citation for part 104 would be revised to read as 
follows:

    Authority: 2 U.S.C. 431, 434, 438(a)(8) and (b) and 439a.

    6. Section 104.18 would be revised to read as follows:


Sec. 104.18  Electronic filing of reports (2 U.S.C. 432(d) and 
434(a)(11)).

    (a) Mandatory. (1) Political committees and other persons required 
to file reports with the Commission, as provided in 11 CFR parts 105 
and 107, must file reports in an electronic format that meets the 
requirements of this section if --
    (i) The political committee or other person has received 
contributions or has reason to expect to receive contributions 
aggregating in excess of $50,000 in any calendar year; or (ii)The 
political committee or other person has made expenditures or has reason 
to expect to make expenditures aggregating in excess of $50,000 in any 
calendar year.
    (2) Once any political committee or other person described in 
paragraph (a)(1) of this section exceeds or has reason to expect to 
exceed the appropriate threshold, the political committee or person 
must file electronically all subsequent reports covering financial 
activity for the remainder of the calendar year. All electronically 
filed reports must pass the Commission's validation program in 
accordance with paragraph (e) of this section.

[[Page 19344]]

    (3) A political committee or other person has reason to expect to 
receive aggregate contributions or to make aggregate expenditures over 
the threshold amount in paragraph (a)(1) of this section if its 
aggregate contributions or aggregate expenditures exceeded the 
threshold in the comparable year in the previous election cycle, or its 
aggregate contributions or aggregate expenditures exceeded the 
threshold in the previous calendar year.
    (b) Voluntary. A political committee or other person who files 
reports with the Commission, as provided in 11 CFR Part 105, and who is 
not required to file electronically under paragraph (a) of this 
section, may choose to file its reports in an electronic format that 
meets the requirements of this section. If a political committee or 
other person chooses to file its reports electronically, all 
electronically filed reports must pass the Commission's validation 
program in accordance with paragraph (e) of this section. The committee 
or other person must continue to file in an electronic format all 
reports covering financial activity for that calendar year, unless the 
Commission determines that extraordinary and unforeseeable 
circumstances have made it impracticable for the political committee or 
other person to continue filing electronically.
    (c) Definition. For purposes of this section, report means any 
statement, designation or report filed with the Commission.
    (d) Format specifications. Reports filed electronically shall 
conform to the technical specifications described in the Federal 
Election Commission's Electronic Filing Specifications Requirements. 
The data contained in the computerized magnetic media provided to the 
Commission shall be organized in the order specified by the Electronic 
Filing Specifications Requirements.
    (e) Acceptance of reports filed in electronic format; validation 
program.
    (1) Each political committee or other person who submits an 
electronic report shall check the report against the Commission's 
validation program before it is submitted, to ensure that the files 
submitted meet the Commission's format specifications and can be read 
by the Commission's computer system. Each report submitted in an 
electronic format under this section shall also be checked upon receipt 
against the Commission's validation program. The Commission's 
validation program and the Electronic Filing Specification Requirement 
are available on request and at no charge.
    (2) A report that does not pass the validation program will not be 
accepted by the Commission and will not be considered filed. If a 
political committee or other person submits a report that does not pass 
the validation program, the Commission will notify the political 
committee or other person that the report has not been accepted.
    (f) Amended reports. If a political committee or other person files 
an amendment to a report that was filed electronically, the political 
committee or other person shall also submit the amendment in an 
electronic format. The political committee or other person shall submit 
a complete version of the report as amended, rather than just those 
portions of the report that are being amended. In addition, the amended 
report shall contain electronic flags or markings that point to the 
portions of the report that are being amended.
    (g) Signature requirements. The political committee's treasurer, or 
any other person having the responsibility to file a designation, 
report or statement under this subchapter, shall verify the report in 
one of the following ways: by submitting a signed certification on 
paper that is submitted with the computerized media; or by submitting a 
digitized copy of the signed certification as a separate file in the 
electronic submission. Each verification submitted under this section 
shall certify that the treasurer or other signatory has examined the 
report or statement and, to the best of the signatory's knowledge and 
belief, it is true, correct and complete. Any verification under this 
section shall be treated for all purposes (including penalties for 
perjury) in the same manner as a verification by signature on a report 
submitted in a paper format.
    (h) Schedules and forms with special requirements. The following 
list of schedules, materials, and forms have special signature and 
other requirements and reports containing these documents shall 
include, in addition to providing the required data within the 
electronic report, either a paper copy submitted with the political 
committee's or other person's electronic report or a digitized version 
submitted as a separate file in the electronic submission: Schedule C-1 
(Loans and Lines of Credit From Lending Institutions), including copies 
of loan agreements required to be filed with that Schedule, Schedule E 
(Itemized Independent Expenditures), Form 5 (Report of Independent 
Expenditures Made and Contributions Received), and Form 8 (Debt 
Settlement Plan). The political committee or other person shall submit 
any paper materials together with the electronic media containing the 
report.
    (i) Preservation of reports. For any report filed in electronic 
format under this section, the treasurer or other person required to 
file any report under the Act shall retain a machine-readable copy of 
the report as the copy preserved under 11 CFR 104.14(b)(2). In 
addition, the treasurer or other person required to file any report 
under the Act shall retain the original signed version of any documents 
submitted in a digitized format under paragraphs (g) and (h) of this 
section.

PART 109--INDEPENDENT EXPENDITURES (2 U.S.C. 431(17), 434(c))

    7. The authority for part 109 would be revised to read as follows:

    Authority: 2 U.S.C. 431(17), 434(a)(11) and (c), 438(a)(8), 
441d.

    8. Section 109.2 would be amended by revising the introductory text 
of paragraph (a) to read as follows:


Sec. 109.2  Reporting of independent expenditures by persons other than 
a political committee (2 U.S.C. 434(c)).

    (a) Every person other than a political committee, who makes 
independent expenditures aggregating in excess of $250 during a 
calendar year shall file a report on FEC Form 5 or, if the person is 
not required to file electronically under 11 CFR 104.18, a signed 
statement with the Commission or Secretary of the Senate in accordance 
with 11 CFR 104.4(c).
* * * * *

PART 114--CORPORATE AND LABOR ORGANIZATION ACTIVITY

    9. The authority citation for part 114 would be revised to read as 
follows:

    Authority: 2 U.S.C. 431(8)(B), 431(9)(B), 432, 434(a)(11), 
437d(a)(8), 438(a)(8) and 441b.

    10. Section 114.10 would be amended by revising paragraph 
(e)(1)(ii) to read as follows:


Sec. 114.10  Nonprofit corporations exempt from the prohibition on 
independent expenditures.

* * * * *
    (e) * * *
    (1) * * *
    (ii) This certification may be made either as part of filing FEC 
Form 5 (independent expenditure form) or, if the corporation is not 
required to file electronically under 11 CFR 104.18, by submitting a 
letter in lieu of the form. The letter shall contain the name and 
address of the corporation and the

[[Page 19345]]

signature and printed name of the individual filing the qualifying 
statement. The letter shall also certify that the corporation has the 
characteristics set forth in paragraphs (c)(1) through (c)(5) of this 
section.
* * * * *

PART 9003--ELIGIBILITY FOR PAYMENTS

    11. The authority citation for part 9003 would continue to read as 
follows:

    Authority: 26 U.S.C. 9003 and 9009(b).


Sec. 9003.1  [Amended]

    12. Section 9003.1 would be amended by removing paragraph (b)(11).

PART 9033--ELIGIBILITY FOR PAYMENTS

    13. The authority citation for part 9033 would continue to read as 
follows:

    Authority: 26 U.S.C. 9033 and 9039(b).


Sec. 9033.1  [Amended]

    14. Section 9033.1 would be amended by removing paragraph (b)(13).

    Dated: April 5, 2000.
Darryl R. Wold,
Chairman, Federal Election Commission.
[FR Doc. 00-8884 Filed 4-10-00; 8:45 am]
BILLING CODE 6715-01-U