[Federal Register Volume 68, Number 162 (Thursday, August 21, 2003)]
[Proposed Rules]
[Pages 50481-50488]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-21463]


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FEDERAL ELECTION COMMISSION

11 CFR Parts 100, 106, 114, 9004, and 9034

[Notice 2003-14]


Candidate Travel

AGENCY: Federal Election Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Election Commission requests comments on proposed 
changes to its rules covering the proper rates and timing for payment 
of candidate travel on private means of transportation that are not 
offered for commercial use, including government conveyances. The 
proposed rule would provide more comprehensive guidance than the 
current regulations by establishing a single, uniform valuation scheme 
for campaign travel that does not depend on whether the service 
provider is a corporation, labor organization, individual, partnership, 
limited liability company or other entity, or on whether the 
destination city is served by regularly scheduled commercial service. 
The proposed rules would apply to all Federal candidates including 
publicly funded presidential candidates. No final decisions have been 
made by the Commission on any of the proposed revisions in this Notice. 
Further information is provided in the supplementary information that 
follows.

DATES: Comments must be received on or before September 19, 2003. If 
the Commission receives sufficient requests to testify, it will hold a 
hearing on these proposed rules on October 1, 2003, at 9:30 a.m. 
Commenters wishing to testify at the hearing must so indicate in their 
written or electronic comments.

ADDRESSES: All comments should be addressed to Ms. Mai T. Dinh, Acting 
Assistant General Counsel, and must be submitted in either electronic 
or written form. Electronic mail comments should be sent to 
[email protected] and must include the full name, electronic mail 
address and postal service address of the commenter. Electronic mail 
comments that do not contain the full name, electronic mail address and 
postal service address of the commenter will not be considered. If the 
electronic mail comments include an attachment, the attachment must be 
in the Adobe Acrobat (.pdf) or Microsoft Word (.doc) format. Faxed 
comments should be sent to (202) 219-3923, with printed copy follow-up 
to ensure legibility. Written comments and printed copies of faxed 
comments should be sent to the Federal Election Commission, 999 E 
Street, NW., Washington, DC 20463. Commenters are strongly encouraged 
to submit comments electronically to ensure timely receipt and 
consideration. The Commission will make every effort to post public 
comments on its Web site within ten business days of the close of the 
comment period. The hearing will be held in the Commission's ninth 
floor meeting room, 999 E Street NW., Washington, DC.

FOR FURTHER INFORMATION CONTACT: Ms. Mai T. Dinh, Acting Assistant 
General Counsel, or Mr. Richard T. Ewell, Attorney, 999 E Street NW., 
Washington, DC 20463, (202) 694-1650 or (800) 424-9530.

SUPPLEMENTARY INFORMATION: The Commission is proposing several changes 
to its rules to establish a simple, uniform payment scheme covering all 
candidate travel on either government or private aircraft and other 
conveyances. The current regulation at 11 CFR 114.9(e) establishes the 
timing for reimbursement and the amount that a candidate must reimburse 
a corporation or labor organization for the use of a private airplane 
or other means of transportation, but does not address means of travel 
furnished by individuals, partnerships, and other entities. The current 
rules in section 114.9(e) are also not fully consistent with the 
Commission's treatment of similar travel by presidential and vice-
presidential candidates using government-provided transportation under 
11 CFR 9004.7 and 9034.7.

[[Page 50482]]

I. Proposed 11 CFR 100.93 Payment for Travel by Airplane and Other 
Means of Transportation

A. Proposed Replacement of 11 CFR 114.9(e) With Proposed 11 CFR 100.93

    The Commission proposes several changes to the candidate travel 
rules currently set forth at 11 CFR 114.9(e). While 11 CFR part 114 
focuses on corporate and labor organization activity, and current 11 
CFR 114.9(e)(2) focuses on means of travel owned or leased by 
corporations or labor organizations, the Commission seeks to broaden 
the rules to include airplanes and other means of travel owned by 
persons other than corporations and labor organizations. The Commission 
recognizes that in most cases the means of travel used for campaign 
trips is likely to be owned or leased by a corporation or labor 
organization, but notes that the current section heading for 11 CFR 
114.9, ``Use of corporate and labor organization facilities and means 
of transportation,'' would not accurately convey the scope of the 
proposed travel rules encompassing airplanes and other means of 
transportation owned by individuals, partnerships, or other entities. 
Therefore, the Commission proposes deleting the reference to ``means of 
transportation'' from the title of 11 CFR 114.9, removing and reserving 
paragraph (e) of 114.9, and relocating the substance of the travel 
reimbursement rules to a new section.
    To accommodate the broadened scope of the travel reimbursement 
rules, the Commission proposes adding new section 100.93 to the 
enumerated exceptions to the definition of ``contribution'' in 11 CFR 
part 100, subpart C. This new section would describe circumstances in 
which the use of a private means of transportation not owned or leased 
by candidates or their authorized committees would not be 
contributions, much like current Sec.  100.52 (also in subpart C), 
which describes when the use of commercial transportation is or is not 
a contribution. Proposed Sec.  100.93 would be based on the current 11 
CFR 114.9(e), with the organizational and substantive changes described 
below.

B. Proposed 11 CFR 100.93(a) Scope and Definitions

1. Proposed Paragraph (a)(1) Scope
    Proposed paragraph (a)(1) would define the scope of the rules and 
clarify any perceived ambiguity regarding the scope of the current 11 
CFR 114.9(e)(1). The current rule focuses on the use of airplanes owned 
by corporations or labor organizations that ``are not licensed to offer 
commercial service for travel in connection with a Federal election.'' 
One district court found this wording to be ambiguous. In this case, a 
presidential candidate claimed that the regulation applied to all 
travel on airplanes except airplanes owned or leased by a corporation 
or labor organization possessing a license for travel in connection 
with a Federal election. See Federal Election Commission v. Arlen 
Specter '96, 150 F. Supp. 2d 797, 804 and 808 (E.D. Pa. 2001). The 
Court noted that no such license existed and ultimately deferred to the 
Commission's longstanding determination that 11 CFR 114.9(e) applies to 
airplanes owned by corporations or labor organizations not engaged in 
the business of providing commercial air service generally, without 
regard to any connection with a Federal election. Id. at 812.
    In order to remove this perceived ambiguity, the Commission 
proposes further clarification of the class of airplanes affected. As 
noted above, proposed 11 CFR 100.93 would apply to service providers 
depending on whether the airplane is or is not ``normally operated for 
commercial passenger service,'' rather than whether the owner of the 
airplane is ``licensed to offer commercial service for travel in 
connection with a Federal election.''
    The Commission notes that commercial and non-commercial air travel 
is subject to the authority of the Department of Transportation (DOT) 
and various certifications of the Federal Aviation Administration 
(FAA). Aircraft are permitted to operate pursuant to various FAA safety 
certifications based generally on passenger capacity, route frequency, 
and type of service offered. Private aircraft not offering commercial 
passenger service operations normally operate under certification 
provided pursuant to either 14 CFR parts 91 or 125.\1\ Some airlines 
receive certificates of public necessity and convenience to operate 
commercial passenger service as common carriers within specified 
domestic locations pursuant to 14 CFR part 135. Other common carriers, 
such as commercial air taxi service and on-demand charter service, are 
permitted to operate under special certification in 14 CFR part 298, 
which exempts them from certain requirements that would be otherwise 
required under 14 CFR part 135. Certain other aircraft are also 
permitted to serve as common carriers and offer passenger service for 
compensation under 14 CFR parts 121 and 129. Each of the FAA 
certifications focuses mainly on the technical specifications and 
safety requirements of the aircraft and crew.
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    \1\ Aircraft operating pursuant to certification under 14 CFR 
parts 91 or 125 are not permitted to operate as common carriers, 
meaning that they cannot hold themselves out to the public as 
providing passenger service for compensation. See 14 CFR 119.1(a) 
(establishing additional base requirements in excess of the 14 CFR 
part 91 requirements for all air carriers and commercial operators 
that serve as common carriers) and 14 CFR 125.1(a) (applies to 
aircraft with a seating capacity of 20 or more persons, but only 
where common carriage is not involved).
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    Aircraft operating under 14 CFR part 91 certification are not 
usually permitted to accept any form of payment or reimbursement from 
passengers, but a special FAA exception permits Federal candidates to 
reimburse the owners of such aircraft for the use of planes pursuant to 
the Commission's regulations. See 14 CFR 91.321.\2\ The Commission 
therefore intends its regulations in proposed 11 CFR 100.93 to apply 
only to airplanes not authorized to conduct operations in air 
transportation as a common carrier (e.g., 14 CFR parts 91 or 125), 
while the current regulations at 11 CFR 100.52 would apply to all 
airplanes operated pursuant to other certifications that do permit 
carriage of passengers for compensation. Proposed 11 CFR 100.93, 
however, would focus on the normal use of the airplane, rather than the 
operating certificate possessed by its owner, to avoid the need for 
title and certification checks. The Commission seeks comment on whether 
the type of certification with the FAA, or some other method, should be 
used to determine whether an airplane is normally operated for 
commercial passenger service such that a normal and usual rate for that 
passenger service could be readily and accurately ascertained.
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    \2\ Aircraft operating under 14 CFR part 125 certification are 
similarly prohibited from operating as common carriers, but there is 
no similar general prohibition on the acceptance of payment from 
passengers to warrant an identical exception.
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    As noted above, the current rule distinguishes between the use of 
airplanes owned or leased by a corporation or labor organization 
licensed to offer commercial services for travel, and airplanes that 
are owned by other corporations or labor organizations not normally 
engaged in commercial air passenger service. This distinction requires 
an examination of the plane's ownership or lease structure to determine 
the proper reimbursement timing and amount. The Commission is concerned 
that the ownership determination may add unnecessary confusion to the 
payment process and is proposing to shift the focus of the rule away 
from whether the airplane's owner is a corporation or labor 
organization

[[Page 50483]]

and onto the normal use of the airplane. The proposed rules would 
therefore apply not only to airplanes owned by corporations or labor 
organizations, but also to airplanes owned by any ``person,'' as 
defined at 11 CFR 100.10, as well as airplanes owned by the Federal 
government or a State or local government.
    An alternative approach, which is not incorporated into the 
proposed rules, would be to focus the distinction on whether the 
service provider is a ``commercial vendor,'' as defined in 11 CFR 
116.1(c), with respect to the transportation services. This approach 
would continue to require an examination of the ownership structure of 
service provider. Relying on the term ``commercial vendor'' could also 
lead to a different result in certain circumstances. For example, 
Commercial Airline A owns a specially configured jet that is reserved 
for its corporate executives and offers the use of that jet to 
Candidate B. Under the ``commercial vendor'' alternative, Commercial 
Airline A would likely qualify as a ``commercial vendor'' of 
transportation services, meaning that 11 CFR 100.52(d), rather than 11 
CFR 100.93, would govern the reimbursement requirements for Candidate 
B's travel on the jet. This result would require Candidate B to 
calculate the ``usual and normal rate'' for the use of the jet under 11 
CFR 100.52(d)(2), which could be difficult to ascertain because 
passengers on the jet are not normally charged any fee. However, under 
the proposed ``not normally operated for commercial passenger service'' 
approach, Candidate B's use of the jet would be governed by proposed 
Sec.  100.93, not Sec.  100.52, and the proper reimbursement could be 
calculated by referring to first-class or charter rates to that 
destination.
    The Commission seeks comments on broadening the coverage of these 
travel rules from corporations and labor organizations to any 
``person'' or government, as well as the proposed shift in focus from 
the ownership of the airplane to the normal use of the airplane.
    The scope of proposed Sec.  100.93, however, would be limited to 
non-commercial means of transportation. A campaign traveler using a 
commercial airline or other means of commercial transportation would 
continue to be subject to the more general definition in 11 CFR 100.52, 
which categorizes ``the provision of any goods or services without 
charge or at a charge that is less than the usual and normal charge for 
such goods or services' as an ``in-kind contribution.'' 11 CFR 
100.52(d). Thus, a candidate or other campaign traveler receives an in-
kind contribution when he or she is provided commercial transportation 
without charge or at a charge that is less than the usual and normal 
charge for that transportation. Proposed Sec.  100.93(a) would include 
a cross-reference to 11 CFR 100.52(a) and (d) to affirm the continued 
application of these rules to providers of commercial transportation.
2. Proposed Paragraph (a)(2) Definitions
    Proposed paragraph (a)(2) would define several terms used in new 
Sec.  100.93. The term ``campaign traveler'' would be defined to 
provide a succinct term covering the candidate, candidate's agent, or 
other individual traveling on behalf of a candidate or a candidate's 
authorized committee. ``Service provider'' would describe the person or 
entity providing the transportation to the campaign traveler. Given the 
complex ownership and leasing arrangements often associated with 
airplanes and other means of transportation, a ``service provider'' may 
be either the owner of the conveyance or a different person who is 
leasing the conveyance from the owner and making it available for the 
campaign traveler's use.
    Under proposed paragraph (a)(2), the term ``unreimbursed value'' 
would be defined as the portion of the value provided to the campaign 
traveler, calculated according to the rules in this section, that is 
not reimbursed by the candidate's authorized committee. A late payment 
would not qualify as a reimbursement under this section, which means 
that the value of the service provided would be an in-kind contribution 
to the candidate. By contrast, a service provider would not make an in-
kind contribution if the candidate's authorized committee provides 
payment within the time specified in this proposed section. The 
Commission seeks comments on each of these definitions.

C. 11 CFR 100.93(b) General Rule

    Proposed Sec.  100.93(b) would set forth the general rule for when 
travel by private means of transportation would not constitute a 
contribution to a candidate or authorized committee, as well as when 
and to what extent such travel is an in-kind contribution. Under 
proposed paragraph (b)(1), a candidate's authorized committee would not 
receive or accept a contribution if the authorized committee pays the 
service provider the full value of the transportation within the 
specified time, as determined in this proposed section. This proposed 
paragraph would generally require that the candidate's authorized 
committee, rather than the campaign traveler, pay the service provider 
to avoid receiving or accepting a contribution. The campaign traveler 
could pay the service provider directly for his or her own travel 
rather than having the campaign committee do so. Such payment would 
constitute an in-kind contribution by the campaign traveler to the 
candidate, unless it qualifies for the transportation expense exception 
set forth in 11 CFR 100.79.
    In light of the fact that the current rules at 11 CFR 114.9(e) are 
limited to airplanes owned by corporations or labor organizations, 
payment is required because the unpaid use of the airplanes would 
constitute a contribution in violation of 2 U.S.C. 441b. In contrast, 
individuals, partnerships, and certain other persons are permitted to 
make in-kind contributions to candidates up to the amounts set forth in 
2 U.S.C. 441a. Thus, a campaign traveler may use an airplane provided 
by someone permitted to make an in-kind contribution, and this use 
would be an in-kind contribution. Proposed 100.93(b)(2) would recognize 
this possibility by describing when a service provider would be making 
an in-kind contribution. For an in-kind contribution to be permissible, 
however, the candidate's authorized committee must comply with the 
payment conditions in proposed 11 CFR 100.93. If these conditions are 
not met, then the provision of the airplane would be prohibited if the 
service provider is a corporation or labor organization, or if the 
value of the service would, when added to other contributions to the 
same candidate by the service provider, exceed that service provider's 
contribution limit. See proposed 11 CFR 100.93(b)(2). The value of the 
in-kind contribution would be determined in the same manner as the 
amount of the reimbursement would normally be determined under proposed 
paragraphs (c), (d) or (e) of new section 100.93.
    The Commission recognizes that this approach could, in some cases, 
require the same type of ownership analysis that otherwise would be 
avoided by the proposed rules. This analysis, however, would no longer 
be a necessary step in every circumstance because it would be employed 
only where the airplane's provider elects not to seek full or partial 
reimbursement from the candidate's authorized committee, or when the 
committee fails to reimburse the service provider. The Commission seeks 
comments on whether reimbursement should always be required, regardless 
of the ownership of the airplane, or whether the possibility of an in-
kind

[[Page 50484]]

contribution from a permissible source should be addressed in some 
other fashion.

D. Proposed 11 CFR 100.93(c) Travel by Airplane

    When a candidate or other campaign passenger uses an airplane owned 
by a person who is not in the business of providing commercial air 
travel, the current rules set the rate of reimbursement at either the 
first-class airfare or the normal charter rate, depending on whether a 
destination city is served by regularly scheduled commercial air 
service. 11 CFR 114.9(e)(1). The charter rate, which is normally higher 
than first-class airfare to an airport in the same area, represents the 
actual cost that a campaign would incur, but for the use of the 
corporate or labor airplane, to reach a particular destination by air 
when that destination is not served by commercial air service. 
Nevertheless, the Commission recognizes that candidates who campaign in 
major metropolitan areas that have regularly scheduled airline service 
will generally be able to use a private plane and reimburse only the 
equivalent of a first-class airfare, whereas the candidates who 
campaign in more rural areas that have little, if any, commercial air 
service would be required to reimburse the equivalent charter rate. The 
Commission is concerned that the current reimbursement scheme might be 
unnecessarily complex and negatively affects campaigning in rural 
areas.
    To address these concerns, the Commission seeks comments on three 
alternative reimbursement rules in proposed 11 CFR 100.93(c), as well 
as any other appropriate payment schemes. The Commission also seeks 
comments on whether and how it should further simplify the rules and 
address other inequities, if any, arising from the current application 
of 11 CFR 114.9(e) or the changes proposed for Sec.  100.93.
    In addition, the Commission notes that many charter services charge 
a traveler for ``deadhead miles,'' those miles the airplane travels 
empty while returning to its home base after a one-way flight. In some 
cases, charter services also require compensation for positioning costs 
for airplanes based many miles from the pickup and drop-off points. The 
Commission therefore seeks comments on how, if at all, the three 
alternative payment schemes should account for these expenses 
associated with the positioning of the airplane or ``deadhead miles.'' 
For example, when a candidate travels one-way from California to 
Virginia on a private airplane based in Nevada and that airplane 
returns empty to Nevada, should that candidate's authorized committee 
be required to pay the expenses associated with the Nevada-to-
California and Virginia-to-Nevada flights? If so, should each of these 
positioning or ``deadhead'' flights be determined in the same manner as 
described in the three alternative payment schemes below, or by using 
some other method?
1. Alternative A: Payment Based on First-Class Airfare
    Alternative A would set the payment rate, for each individual 
traveling for campaign purposes, at the amount of the lowest non-
discounted first-class airfare to the closest airport that has such 
service, regardless of whether the actual destination airport is served 
by regularly scheduled commercial air service. The proposed rule would 
focus on the closest destination airport, rather than the destination 
city, to avoid further confusion in light of the various geographic 
considerations discussed in Advisory Opinion (``AO'') 1999-13.\3\ 
Because airfares may vary based on the date of travel, the rate used in 
calculating the payment amount would have to correspond to the date of 
actual travel. The Commission seeks comments on how precisely the base 
rate should correspond to the actual date of travel. For example, some 
airlines or charter companies may set a base rate for tickets purchased 
over a month in advance of the travel date that is different than the 
price of the same ticket when purchased on the date of travel. Should a 
campaign be permitted to use the normal advance ticket price when 
calculating the comparable base rate as required in proposed Sec.  
100.93, or should a campaign be required to calculate the comparable 
rate based on purchase on a fixed date or period, such as the actual 
date of travel or the lowest price within seven days of the travel 
date?
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    \3\ In AO 1999-13, the Commission recognized that particular 
destination cities might be serviced by several airports in the 
surrounding region. In that advisory opinion, the Commission 
determined that an airport need not be within the corporate limits 
of a city in order for that city to be considered ``served by 
regularly scheduled commercial air service.'' The Commission further 
agreed that it was reasonable for the requestor to determine whether 
a city is served by a particular airport through reference to 
published sources such as a FAA directory or a corporate directory 
regarded at the time as the charter industry's standard reference 
for airports.
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    Alternative A would also allow an authorized committee to reimburse 
the provider of a private airplane at the coach rate to the destination 
airport where the same airport is served by regularly scheduled coach 
airline service but not regularly scheduled first-class airline 
service. This distinction for coach service would accommodate industry 
trends and is based on the current rules governing presidential 
candidates' payments for the use of government aircraft. See 11 CFR 
9004.7(b)(5)(i)(B) and 9034.7(b)(5)(i)(B). Please note, however, that 
if the actual destination is an airport that is not served by any 
regularly scheduled commercial air service, and the closest airport is 
served by regularly scheduled coach airline service but not regularly 
scheduled first-class airline service, the proposed reimbursement 
amount would still be the lowest non-discounted first-class airfare for 
the closest airport that is served by regularly scheduled first-class 
airline service and not the coach fare for the closest airport.
    In addition, Alternative A would eliminate the advance payment 
requirement in 11 CFR 114.9(e)(1). Currently, because payment must be 
made prior to travel, the campaign must provide a check in advance to 
the corporation to cover a certain number of passengers. If last minute 
passengers are not paid for prior to boarding the airplane, the 
campaign has failed to comply with the requirements of current 11 CFR 
114.9(e)(1), regardless of how promptly the campaign subsequently makes 
an after-the-fact reimbursement. However, where candidates use other 
means of transportation addressed in 11 CFR 109.2(e)(2), last minute 
passengers do not cause the same complications because the 
reimbursement may be made ``within a commercially reasonable time,'' 
rather than in advance, so that the number of passengers is settled at 
the time the reimbursement is made.
    Alternative A would address this disparate treatment by allowing a 
fixed period of seven calendar days for payment after travel has begun. 
This seven-day period would be shorter than the thirty-or-sixty day 
period used for other forms of transportation, see below, because under 
Alternative A the campaign would have complete control over the timing 
of the reimbursement as all the necessary passenger information and 
costs would be fixed at the time the airplane departs. Thus, it should 
be possible for the candidate's authorized committee to calculate the 
proper reimbursement rate without a billing or invoice process to cause 
delay.
    The Commission recognizes that the removal of the advance payment 
rule could be perceived as a departure from the previous approach under 
which corporations are prohibited from extending credit outside the 
ordinary course of their business. See 11 CFR

[[Page 50485]]

part 116. While the creation of a fixed post-travel time period for 
reimbursement in these circumstances is technically an extension of 
credit, the Commission nevertheless seeks comments on the potential 
consequences of the proposed rule with respect to the use of an 
airplane owned by a corporation or labor organization where 
reimbursement does not occur in advance. The Commission also seeks 
comments on whether the advance payment requirement should be retained 
and what, if any, other reimbursement timetables would be appropriate.
2. Alternative B: Payment Based on a Combination of First-Class Airfare 
and Charter Rate
    Alternative B would provide for two different payment rates, 
following closely the travel valuation rules set forth in the ethics 
rules for the House of Representatives and the United States Senate. 
See Select Committee on Ethics, U.S. Senate, Senate Ethics Manual, S. 
Pub. No. 108-1 (2003), ``Private Air Travel'' at p. 60; Committee on 
Standards of Official Conduct, U.S. House of Representatives, Rules of 
the U.S House of Representatives on Gifts and Travel (2001), ``Use of 
Private Aircraft for Travel'' available at <http://www.house.gov/ethics/ Gifts--and--Travel-- Chapter.htm#--Toc476623633. The 
first rate, in proposed paragraph (c)(1) of Alternative B, would apply 
to previously scheduled flights, as opposed to flights specifically 
scheduled for a campaign traveler, between cities with regularly 
scheduled air service. The payment rate for these trips would be the 
normal cost of first-class airfare between the cities. Thus, travel 
between airports served by regularly scheduled air service would be 
treated similarly under both Alternative A and Alternative B, except 
that Alternative B would not permit the first-class airfare amount 
where the airplane is chartered specifically for the campaign 
traveler's use. Both Alternative A and Alternative B would permit 
payment at the coach rate where coach service is regularly scheduled on 
the same route, but would not permit campaigns to pay the lower amount 
for discounted fares such as ``supersavers,'' ``e-savers,'' or a 
government rate.
    Under proposed paragraph (c)(2) of Alternative B, the Commission 
would require the amount of payment for other air travel, including 
flights specifically scheduled for a campaign traveler or flights where 
the origin or destination city is not served by regularly scheduled air 
service, to be no less than the normal charter rate for a similar 
airplane. The valuation of travel to airports not served by regularly 
scheduled commercial airline service would therefore differ from the 
valuation in proposed paragraph (c)(3) of Alternative A, which would 
value such travel at the amount of the first-class rate to the nearest 
airport. For the same reasons discussed above for Alternative A, the 
candidate's authorized committee would be required to make the proper 
payment within seven calendar days of the departure date.
3. Alternative C: Payment Based on Charter Rate
    Alternative C would establish a uniform rule by requiring the 
payment amount to be the normal and usual cost of chartering a plane of 
sufficient size to accommodate all campaign travelers plus the news 
media and security personnel where applicable. This payment rate would 
depend on the rate for chartering the entire plane, rather than a per-
passenger cost, and would not vary based on whether the destination 
airport is served by regularly scheduled commercial air service of any 
particular class. Alternative C could provide a more accurate 
reflection of the true value of the use of a private or governmental 
airplane by campaign travelers. Because the campaign would be 
responsible for the cost of chartering the entire plane and the 
addition of last minute travelers would not increase the cost, the 
payment amount would be known prior to the time of departure. Thus, the 
Commission would continue to require advance payment for the use of all 
airplanes not normally used for commercial passenger service. To the 
extent that Alternative C would increase the cost of candidate travel 
when private airplanes are used, should the Commission consider such a 
factor when it evaluates appropriate reimbursement rates?

E. Proposed 11 CFR 100.93(d) Other Means of Transportation

    The Commission proposes a set period of time for payment of travel 
by means other than by airplane: thirty calendar days from the receipt 
of the invoice, but no more than sixty calendar days following the date 
the travel commenced. See proposed 11 CFR 100.93(d). This fixed 
deadline would add more clarity and certainty than the current rule's 
reference to a ``commercially reasonable'' period, but would retain the 
flexibility necessary to account for costs that cannot be calculated 
until the completion of travel or shortly thereafter. The sixty-day 
cutoff would help to ensure that the invoice will be rendered to the 
campaign promptly. Any extensions of credit resulting from payments not 
being made within the sixty-day period would be considered in-kind 
contributions to the candidate and would therefore result in a 
violation of the Act and Commission regulations where such 
contributions are prohibited or excessive. The payment rate would be 
set at the usual and normal fare or rental readily available to the 
general public at the time of travel.

F. Proposed 11 CFR 100.93(e) Government Conveyances

    Paragraph (e) of proposed 11 CFR 100.93 would clarify the 
appropriate payment for travel using any means of transportation, 
including an airplane, that is owned or leased by the Federal 
government or any State or local government. For government airplanes, 
one of the three alternatives described above would be used. For other 
means of travel, a campaign traveler using a government conveyance 
would have to reimburse the government entity within thirty calendar 
days of the receipt of an invoice, but no later than sixty calendar 
days following the date on which travel commenced. The required payment 
rate would be the amount of the usual fare or rental charge readily 
available to the general public for the travel date.

G. Proposed 11 CFR 100.93(f) Reporting

    Proposed paragraph (f)(1) of 11 CFR 100.93 would refer candidates 
and their authorized committees to the existing reporting requirements 
for the receipt of an in-kind contribution. Under 11 CFR 104.13, a 
candidate must report the amount of unreimbursed value for travel 
services as both the receipt of a contribution from the service 
provider and an expenditure by the candidate committee.
    In addition, a candidate's authorized committee would be required 
to record the travel dates along with the report of the disbursement 
for repayment of the travel service. Under proposed paragraph (f)(2) of 
Sec. 100.93, the Commission would require the authorized committee to 
report the actual date of travel in the ``purpose of disbursement'' 
field corresponding to the disbursement.

H. Proposed 11 CFR 100.93(g) Recordkeeping

    Presidential and vice-presidential candidates are currently 
required to maintain records documenting the rates used in calculating 
their travel reimbursements. 11 CFR 9004.7(b)(5)(v) and 
9034.7(b)(5)(v). Under proposed 11 CFR 100.93(g), these recordkeeping

[[Page 50486]]

requirements would apply to other candidates.

II. Proposed Revisions to 11 CFR 106.3(e) Reportable Expenditure for a 
Candidate Who Uses Government Conveyance for Campaign Related Travel

    Candidates who use government conveyance or accommodations for 
campaign-related travel are currently required to report an expenditure 
in the amount equivalent to the ``rate for comparable commercial 
conveyance or accommodation.'' 11 CFR 106.3(e). To eliminate 
disparities between campaign-related travel on private planes and 
travel on government planes, the Commission proposes revising 11 CFR 
106.3 by replacing the reference to the ``rate of comparable commercial 
conveyance'' with a reference to the applicable rates for travel 
reimbursement set forth in proposed 11 CFR 100.93(c) and (d). Both the 
reimbursement rates and the payment due dates in proposed 11 CFR 100.93 
would be applicable to travel by airplane and other means of travel, 
whether owned by an individual, corporation, labor organization, 
partnership, the Federal government, a State government, or any other 
person. The Commission seeks comment on this approach and the proposed 
revisions to 11 CFR 106.3(e).

III. Proposed Revisions to 11 CFR 9004.7(b) and 9034.7(b) Payment for 
Travel on Government Conveyances by Publicly Funded Presidential 
Candidates

    The current regulations at 11 CFR 9004.7(b) and 9034.7(b) govern 
travel on government conveyance by primary and general election 
presidential and vice-presidential candidates receiving federal 
funding. The two rules are virtually identical and require the 
presidential or vice-presidential candidate to pay the appropriate 
government entity at one of several specified rates. These rates are 
established in largely the same manner as the reimbursement rates set 
forth in the current 11 CFR 114.9(e). The Commission proposes revising 
11 CFR 9004.7(b)(5)(i) and (8) and 9034.7(b)(5)(i) and (8) to replace 
the parallel rate determinations in those rules with a reference to the 
reimbursement rates that would be set forth in proposed 11 CFR 100.93. 
As with the valuation of travel on government conveyances by non-
presidential or vice-presidential candidates in 11 CFR 106.3(e), the 
reimbursement rates in proposed 11 CFR 100.93 would serve as the 
applicable valuation of travel by presidential and vice-presidential 
candidates aboard government conveyances. Minor changes would be made 
to the wording in paragraphs (b)(5)(i) through (iv) in sections 9004.7 
and 9034.7 to clarify that the required reimbursement rate is a floor, 
not a ceiling on how much the candidate may reimburse, in order to 
permit a candidate to pay at a higher rate when required by other 
government agencies or branches. The Commission seeks comment on this 
approach and the proposed revisions to 11 CFR 9004.7 and 9034.7.

V. Other Travel Issues

    While the various approaches in the proposed rules may at times 
overstate or understate the actual cost or value of the air 
transportation service provided, the Commission anticipates that over 
time the costs will even out so that the actual disparity, if any, will 
be minor. The proposed rules are premised on the belief that an across-
the-board approach to determining air travel costs is advisable, both 
for ease of compliance and for ease of administration. Nevertheless, 
the Commission recognizes that situations may arise that would not be 
readily addressed by the proposed rules. The Commission is therefore 
seeking comments describing how, if at all, some of these situations 
should be addressed in the rules.

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

[Regulatory Flexibility Act]
    The attached proposed rules, if promulgated, would not have a 
significant economic impact on a substantial number of small entities. 
The basis for this certification is that few, if any, small entities 
would be affected by these proposals, which apply only to Federal 
candidates and their campaign committees. Federal candidates and their 
campaign committees are not small entities. To the extent that 
operators of air-taxi services or on-demand air charter services are 
affected, the effect would result from candidate travel choices rather 
than Commission requirements. These rules propose no sweeping changes, 
and are largely intended to simplify the process of determining payment 
and allocation ratios and reimbursement rates. The proposed rules would 
not increase the cost of compliance by small entities so as to cause a 
significant economic impact.

List of Subjects

11 CFR Part 100

    Elections.

11 CFR Part 106

    Campaign funds, political committees and parties, political 
candidates.

11 CFR Part 114

    Business and industry, elections, labor.

11 CFR Part 9004

    Campaign funds.

11 CFR Part 9034

    Campaign funds, reporting and recordkeeping requirements.
    For the reasons set out in the preamble, the Federal Election 
Commission proposes to amend subchapters A, E, and F of chapter 1 of 
title 11 of the Code of Federal Regulations as follows:

PART 100--SCOPE AND DEFINITIONS (2 U.S.C. 431)

    1. The authority citation for part 100 would continue to read as 
follows:

    Authority: 2 U.S.C. 431, 434, and 438(a)(8).
    2. Section 100.93 would be added to subpart C of part 100 to read 
as follows:


Sec.  100.93  Travel by airplane or other means of travel.

    (a) Scope and definitions.
    (1) This section applies to all campaign travelers who use an 
airplane, or other means of transportation that is not normally 
operated for commercial passenger service. See 11 CFR 100.52(a) and (d) 
for treatment of transportation services that are normally operated for 
commercial passenger service.
    (2) For the purposes of this section, the following terms are 
defined as follows:
    Campaign traveler means a candidate, candidate's agent, or other 
individual traveling on behalf of a candidate or candidate's authorized 
committee.
    Service provider means the owner of an airplane or other 
conveyance, or a person who leases an airplane or other conveyance from 
the owner, and uses the airplane or other conveyance to provide 
transportation to a campaign traveler.
    Unreimbursed value means the difference between the actual value of 
the service provided, as set forth in this section, and the amount of 
payment for that service by the campaign traveler to the service 
provider within the time limits set forth in this section. A payment 
that is not made within the time limits set forth in this section is 
not a reimbursement for the purposes of this section.
    (b) General rule.
    (1) No contribution results from travel by airplane, or other means 
of

[[Page 50487]]

transportation, by a campaign traveler, if the candidate's authorized 
committee reimburses the service provider, within the required time, 
for the full value of the transportation as provided in this section.
    (2) Except as provided in 11 CFR 100.79, the unreimbursed value of 
the transportation provided to a campaign traveler, as determined in 
paragraphs (c) or (d) of this section, is an in-kind contribution from 
the service provider to the candidate.
[Alternative A]
    (c) Travel by airplane. If a campaign traveler uses an airplane 
that is not normally operated for commercial passenger service, the 
candidate's authorized committee must pay the service provider, no 
later than seven (7) calendar days after the date the flight began, the 
following amount:
    (1) In the case of travel to an airport served by regularly 
scheduled first-class commercial airline service, the lowest 
unrestricted and non-discounted first-class air fare available for time 
traveled; or
    (2) In the case of an airport served by regularly scheduled coach 
airline service, but not regularly scheduled first-class commercial 
airline service, the lowest unrestricted and non-discounted coach 
commercial air fare for the time traveled; or
    (3) In the case of travel to an airport not served by regularly 
scheduled commercial airline service, the lowest unrestricted first-
class airfare, for the time traveled, to the airport:
    (i) With regularly scheduled first-class commercial service; and
    (ii) That is closest to the airport actually used.
[Alternative B]
    (c) Travel by airplane. If a campaign traveler uses an airplane 
that is not normally operated for commercial passenger service, the 
candidate's authorized committee must pay the service provider, no 
later than seven (7) calendar days after the date the flight began, the 
following amount:
    (1) In the case of travel via a previously or regularly scheduled 
flight by the owner or operator of the airplane, where the cities 
between which the campaign traveler is flying have regularly scheduled 
commercial air service (regardless of whether such service is direct), 
the cost of a first-class ticket from the point of departure to the 
destination. If only coach service is available between those points, 
the amount is the coach rate. If more than one first-class or coach 
rate is available, the amount is the lowest fare. However, no discount 
fares, such as ``supersaver'' fares, will be used for valuation 
purposes.
    (2) In the case of a flight scheduled specifically for the use of a 
campaign traveler, or when the route does not have regularly scheduled 
commercial air service, the cost of chartering the same or a similar 
airplane for that flight. If campaign travelers for more than one 
candidate are traveling together between cities with no regularly 
scheduled service, then each candidate's authorized committee must pay 
its proportionate share of the cost of the charter.
[Alternative C]
    (c) Travel by airplane. If a campaign traveler uses an airplane 
that is not normally operated for commercial passenger service, the 
candidate's authorized committee must pay the service provider, in 
advance, the usual commercial charter rate for an airplane sufficient 
in size to accommodate the campaign-related travelers, including the 
candidate, news media, and security personnel.
    (d) Other means of transportation. If a campaign traveler who uses 
any other means of transportation, including an automobile, train, or 
helicopter, the candidate's authorized committee must reimburse the 
service provider within thirty (30) calendar days after the date of 
receipt of the invoice for such travel, but not later than sixty (60) 
calendar days after the date the travel began, at the normal and usual 
fare or rental charge readily available to the general public for time 
traveled.
    (e) Government conveyances.
    (1) If a campaign traveler uses an airplane that is provided by the 
Federal government, or by a State or local government, the candidate's 
authorized committee must pay the governmental entity in accordance 
with paragraph (c) of this section.
    (2) If a campaign traveler uses a conveyance, other than an 
airplane, that is provided by the Federal government, or by a State or 
local government, the candidate's authorized committee must reimburse 
the government entity in accordance with paragraph (d) of this section.
    (f) Reporting.
    (1) In accordance with 11 CFR 104.13, a candidate's authorized 
committee must report the receipt of an in-kind contribution and the 
making of an expenditure under paragraph (b)(2) of this section.
    (2) When reporting a disbursement for travel services in accordance 
with this section, a candidate's authorized committee must report the 
actual dates of travel for which the disbursement is made in the 
``purpose of disbursement'' field.
    (g) Recordkeeping.
    (1) For travel by airplane, the candidate's authorized committee 
shall maintain documentation of the lowest unrestricted nondiscounted 
air fare for the time traveled, including the airline, flight number 
and travel service providing that fare or the charter rate, as 
appropriate.
    (2) For travel by other conveyances, the candidate's authorized 
committee shall maintain documentation of the commercial fare or rental 
charge for a conveyance of sufficient size, including the service 
provider and the size, model and make of the conveyance.

PART 106--ALLOCATIONS OF CANDIDATE AND COMMITTEE ACTIVITIES

    3. The authority citation for part 106 would continue to read as 
follows:

    Authority: 2 U.S.C. 438(a)(8), 441a(b), 441a(g).

    4. Section 106.3 would be amended by revising paragraph (e) to read 
as follows:


Sec.  106.3  Allocation of expenses between campaign and non-campaign 
related travel.

* * * * *
    (e) Notwithstanding paragraphs (b) and (c) of this section, the 
reportable expenditure for a candidate who uses government conveyance 
for travel that is campaign-related is the applicable rate set forth in 
11 CFR 100.93(c) or (d). The reportable expenditure for a candidate who 
uses government accommodations for travel that is campaign-related is 
the rate for comparable commercial accommodation. In the case of a 
candidate authorized by law or required by national security to be 
accompanied by staff and equipment, the allocable expenditures are the 
costs of facilities sufficient to accommodate the party, less 
authorized or required personnel and equipment. If such a trip includes 
both campaign and noncampaign stops, equivalent costs are calculated in 
accordance with paragraphs (b) and (c) of this section.

PART 114--CORPORATE AND LABOR ORGANIZATION ACTIVITY

    5. The authority citation for part 114 would continue to read as 
follows:

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

    6. Section 114.9 would be amended by revising the section title and 
removing and reserving paragraph (e) to read as follows:

[[Page 50488]]

Sec.  114.9  Use of corporate or labor organization facilities.

* * * * *
    (e) [Removed and reserved]

PART 9004--ENTITLEMENT OF ELIGIBLE CANDIDATES TO PAYMENTS; USE OF 
PAYMENTS

    7. The authority citation for Part 9004 would continue to read as 
follows:

    Authority: 26 U.S.C. 9004 and 9009(b).

    8. Section 9004.7 would be amended by revising paragraphs (b)(5) 
and (b)(8) to read as follows:


Sec.  9004.7  Allocation of travel expenditures.

* * * * *
    (b) * * *
    (5) Payment for use of government conveyances and accommodations.
    (i) If any individual, including a candidate, uses a government 
airplane for campaign-related travel, the candidate's authorized 
committee shall pay the appropriate government entity an amount not 
less than the applicable rate set forth in 11 CFR 100.93(c).
    (ii) If a government airplane is flown to a campaign-related stop 
where it will pick up passengers, or from a campaign-related stop where 
it left off passengers, the candidate's authorized committee shall pay 
the appropriate government entity an amount not less than the greater 
of the amount billed or the amount required under 11 CFR 100.93(c) for 
one passenger.
    (iii) If any individual, including a candidate, uses a government 
conveyance, other than an airplane, for campaign-related travel, the 
candidate's authorized committee shall pay the appropriate government 
entity an amount not less than the commercial rental rate for a 
conveyance sufficient in size to accommodate the campaign-related 
travelers, including the candidate, plus the news media and the Secret 
Service.
    (iv) If any individual, including a candidate, uses accommodations, 
including lodging and meeting rooms, during campaign-related travel, 
and the accommodations are paid for by a government entity, the 
candidate's authorized committee shall pay the appropriate government 
entity an amount not less than the usual and normal charge for the 
accommodations, and shall maintain documentation supporting the amount 
paid.
    (v) For travel by airplane, the committee shall maintain 
documentation of the lowest unrestricted nondiscounted air fare 
available for the time traveled, including the airline, flight number 
and travel service providing that fare or the charter rate, as 
appropriate. For travel by other conveyances, the committee shall 
maintain documentation of the commercial rental rate for a conveyance 
of sufficient size, including the provider of the conveyance and the 
size, model and make of the conveyance.
* * * * *
    (8) Travel on private airplanes and other conveyances not normally 
operated for commercial passenger service is governed by 11 CFR 100.93.
* * * * *

PART 9034--ENTITLEMENTS

    9. The authority citation for part 9034 would continue to read as 
follows:

    Authority: 26 U.S.C. 9034 and 9039(b).

    10. Section 9034.7 would be amended by revising paragraphs (b)(5) 
and (b)(8) to read as follows:


Sec.  9034.7  Allocation of travel expenditures.

* * * * *
    (b) * * *
    (5) Payment for use of government conveyances and accommodations.
    (i) If any individual, including a candidate, uses a government 
airplane for campaign-related travel, the candidate's authorized 
committee shall pay the appropriate government entity an amount not 
less than the applicable rate set forth in 11 CFR 100.93(c).
    (ii) If a government airplane is flown to a campaign-related stop 
where it will pick up passengers, or from a campaign-related stop where 
it left off passengers, the candidate's authorized committee shall pay 
the appropriate government entity an amount not less than the greater 
of the amount billed or the amount required under 11 CFR 100.93(c) for 
one passenger.
    (iii) If any individual, including a candidate, uses a government 
conveyance, other than an airplane, for campaign-related travel, the 
candidate's authorized committee shall pay the appropriate government 
entity an amount not less than the commercial rental rate for a 
conveyance sufficient in size to accommodate the campaign-related 
travelers, including the candidate, plus the news media and the Secret 
Service.
    (iv) If any individual, including a candidate, uses accommodations, 
including lodging and meeting rooms, during campaign-related travel, 
and the accommodations are paid for by a government entity, the 
candidate's authorized committee shall pay the appropriate government 
entity an amount not less than the usual and normal charge for the 
accommodations, and shall maintain documentation supporting the amount 
paid.
    (v) For travel by airplane, the committee shall maintain 
documentation of the lowest unrestricted nondiscounted air fare 
available for the time traveled, including the airline, flight number 
and travel service providing that fare or the charter rate, as 
appropriate. For travel by other conveyances, the committee shall 
maintain documentation of the commercial rental rate for a conveyance 
of sufficient size, including the provider of the conveyance and the 
size, model and make of the conveyance.
* * * * *
    (8) Travel on private airplanes and other conveyances not normally 
operated for commercial passenger service is governed by 11 CFR 100.93.

    Dated: August 18, 2003.
Michael E. Toner,
Commissioner, Federal Election Commission.
[FR Doc. 03-21463 Filed 8-20-03; 8:45 am]
BILLING CODE 6715-01-P