[Federal Register Volume 71, Number 55 (Wednesday, March 22, 2006)]
[Rules and Regulations]
[Pages 14357-14360]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-2766]



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  Federal Register / Vol. 71, No. 55 / Wednesday, March 22, 2006 / 
Rules and Regulations  

[[Page 14357]]



FEDERAL ELECTION COMMISSION

11 CFR Part 100

[Notice 2006-7]


Definition of Federal Election Activity

AGENCY: Federal Election Commission.

ACTION: Interim Final Rule.

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SUMMARY: The Federal Election Commission (``Commission'') is revising 
the regulation defining the phrase ``in connection with an election in 
which a candidate for Federal office appears on the ballot.'' The 
Bipartisan Campaign Reform Act of 2002 (``BCRA'') amended the Federal 
Election Campaign Act of 1971 (``FECA''), to provide that when voter 
identification, get-out-the-vote activity, and generic campaign 
activities are in connection with an election in which a candidate for 
Federal office appears on the ballot, they are ``Federal election 
activity'' (``FEA''), subject to certain funding limits and 
prohibitions. In its new interim final rule, the Commission specifies 
when voter identification and get-out-the-vote activity are conducted 
exclusively in connection with non-Federal elections and are therefore 
not FEA. The Commission is soliciting comments on all aspects of the 
interim final rule and may amend the interim rule as appropriate in 
response to comments received. Further information is provided in the 
SUPPLEMENTARY INFORMATION that follows.

DATES: The interim final rule is effective on March 24, 2006. Comments 
must be received on or before May 22, 2006.

ADDRESSES: All comments must be in writing, must be addressed to Ms. 
Mai T. Dinh, Assistant General Counsel, and must be submitted in either 
e-mail, facsimile, or paper copy form. Commenters are strongly 
encouraged to submit comments by e-mail or fax to ensure timely receipt 
and consideration. E-mail comments must be sent to either 
[email protected] or submitted through the Federal 
eRegulations Portal at www.regulations.gov. If e-mail comments include 
an attachment, the attachment must be in Adobe Acrobat (.pdf) or 
Microsoft Word (.doc) format. Faxed comments must be sent to (202) 219-
3923, with paper copy follow-up. Paper copy comments and paper copy 
follow-up of faxed comments must be sent to the Federal Election 
Commission, 999 E Street, NW., Washington, DC 20463. All comments must 
include the full name and postal service address of the commenter or 
they will not be considered. The Commission will post comments on its 
Web site after the comment period ends.

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

SUPPLEMENTARY INFORMATION: The Bipartisan Campaign Reform Act of 2002, 
Public Law 107-155, 116 Stat. 81 (2002), amended FECA by adding a new 
term, ``Federal election activity,'' to describe certain activities 
that State, district, and local party committees must pay for with 
either Federal funds or a combination of Federal and Levin funds.\1\ 2 
U.S.C. 431(20) and 441i(b)(1). The FEA requirements apply to all State, 
district, and local party committees and organizations, regardless of 
whether they are registered as political committees with the 
Commission. The term also affects fundraising on behalf of tax-exempt 
organizations.\2\
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    \1\ ``Federal funds'' are funds subject to the limitations, 
prohibitions, and reporting requirements of the Act. See 11 CFR 
300.2(g). ``Levin funds'' are funds raised by State, district, and 
local party committees pursuant to the restrictions in 11 CFR 300.31 
and disbursed subject to the restrictions in 11 CFR 300.32. See 11 
CFR 300.2(i).
    \2\ National, State, district and local party committees are 
prohibited from soliciting or directing non-Federal funds to tax-
exempt entities organized under 26 U.S.C. 501(c) that engage in FEA 
or make other disbursements or expenditures in connection with a 
Federal election. 2 U.S.C. 441i(d)(1). Also, Federal candidates and 
officeholders may make only limited solicitations for funds on 
behalf of tax-exempt entities organized under U.S.C. 501(c) whose 
principal purpose is to conduct certain types of FEA. 2 U.S.C. 
441i(e)(4).
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    BCRA specifies that voter identification, get-out-the-vote activity 
(``GOTV activity''), and generic campaign activity (collectively ``Type 
II FEA'') constitute FEA only when these activities are conducted ``in 
connection with an election in which a candidate for Federal office 
appears on the ballot.'' 2 U.S.C. 431(20)(A)(ii). In 2002, the 
Commission defined ``in connection with an election in which a 
candidate for Federal office appears on the ballot'' as beginning on 
the filing deadline for access to the primary election ballot and 
ending on the date of the general election, or, in those States that do 
not conduct primaries, as beginning on January 1 of each even-numbered 
year. See 11 CFR 100.24(a)(1). The Commission is now issuing an interim 
final rule refining the definition of ``in connection with an election 
in which a candidate for Federal office appears on the ballot'' to 
clarify when activities and communications are in connection with a 
non-Federal election, and are not in connection with a Federal 
election, and therefore are not Type II FEA.
    Under the Administrative Procedure Act (``APA''), 5 U.S.C. 553(b), 
agencies must provide public notice and an opportunity for comment 
(``notice and comment'') before they may promulgate final rules. 
However, the ``good cause'' exemption allows an agency to waive this 
requirement if the agency determines that notice and comment is 
``impracticable, unnecessary or contrary to the public interest.'' See 
5 U.S.C. 553(b)(B). For the reasons stated below, the Commission 
determines that providing notice and comment for the interim final rule 
would be impracticable and contrary to the public interest.
    The Type II FEA time period currently applies throughout much of 
the country, while scores of municipalities have scheduled non-Federal 
elections as early as March 2006. Thus, political campaign activity 
related to the upcoming non-Federal elections will fall within the Type 
II FEA time period as defined in 11 CFR 100.24(a)(1)(i). The interim 
final rule at new section 100.24(a)(1)(iii) ensures that the FEA 
requirements do not extend to activities that are solely in connection 
with these upcoming non-Federal elections and are therefore beyond the 
scope of FECA. Any delay for notice and comment would make it 
impossible to promulgate section 100.24(a)(1)(iii) before the upcoming 
non-Federal elections and would cause

[[Page 14358]]

the FEA regulations to cover improperly activities that as a matter of 
law are not in connection with an election for Federal office.
    Additionally, other regulatory changes in 2006 enhance the need to 
distinguish activities that are ``in connection with'' a Federal 
election from those activities that are not. See Final Rules on the 
Definition of Federal Election Activity, 71 FR 8926 (Feb. 22, 2006) 
(``2006 Final Rules''). These other changes were required by the Shays 
district court and will take effect March 24, 2006. In order to have 
one consistent definition of ``FEA'' for the remainder of this election 
cycle, the interim final rule needs to be effective on the same date 
that the 2006 Final Rules are effective. Therefore, it would be 
impracticable and contrary to the public interest to delay promulgation 
of the interim final rule to provide notice and comment prior to the 
implementation of new section 100.24(a)(1)(iii). See 5 U.S.C. 
553(b)(B).
    For the same reasons the Commission is promulgating the interim 
final rule under the ``good cause'' exception in 5 U.S.C. 553(b)(B), 
the effective date does not need to be delayed 30 days from the date of 
publication in the Federal Register under 5 U.S.C. 553(d)(3). 
Therefore, the interim final rule at 11 CFR 100.24(a)(1)(iii) will take 
effect on March 24, 2006.
    The Commission seeks public comment on the interim final rule. The 
Commission will consider such comments, along with the written comments 
and hearing testimony on the issues raised in the Notice of Proposed 
Rulemaking on the Definition of Federal Election Activity, 70 FR 23068 
(May 4, 2005) (``2005 NPRM''), and it intends to promulgate a Final 
Rule addressing activities that are limited to elections for non-
Federal offices as soon as its rulemaking calendar permits. Seeking 
public comment on a rule that has taken effect permits the Commission 
simultaneously to implement FECA properly, to comply with the 
requirements of the Shays district court decision in a timely manner, 
and to seek and consider additional public comment before promulgating 
a Final Rule in this area. The interim final rule provides that it will 
not apply to activities or communications that take place after 
September 1, 2007. See new 11 CFR 100.24(a)(1)(iii)(B). The Commission 
expects to consider any public comments and may adopt a Final Rule that 
can be effective on or before that date.
    Under the Congressional Review of Agency Rulemaking Act, 5 U.S.C. 
801(a)(1)(A), agencies must submit final rules to the Speaker of the 
House of Representatives and the President of the Senate before they 
take effect. The interim final rule was transmitted to Congress on 
March 17, 2006. Unless the final rules are major rules, the effective 
date for final rules is the date they become effective under the APA. 
Because the interim final rule is not a major rule, it takes effect on 
March 24, 2006 for the reasons stated above.

Explanation and Justification for 11 CFR 100.24(a)(1)(iii)

    In its 2002 definitions of ``FEA,'' the Commission established a 
time period for determining when voter identification, GOTV activity, 
and generic campaign activities are ``in connection with'' a Federal 
election. The time period begins on the date of the earliest filing 
deadline for a primary election ballot for Federal candidates in each 
particular State and ends on the date of the general election, up to 
and including any runoff election date. See 11 CFR 100.24(a)(1)(i). For 
States that do not hold primary elections, the period begins January 1 
of each even-numbered year. Id. For special elections in which Federal 
candidates are on the ballot, the period begins when the date of the 
special election is set and ends on the date of the special election. 
See 11 CFR 100.24(a)(1)(ii).

2005 Notice of Proposed Rulemaking

    In 2004, several of the Commission's rules defining FEA terms were 
reviewed by the U.S. District Court for the District of Columbia in 
Shays v. FEC, 337 F. Supp. 2d 28 (D.D.C. 2004), aff'd, 414 F.3d 76 
(D.C. Cir. 2005) (``Shays''). In response to the district court's 
decision, the Commission published a Notice of Proposed Rulemaking on 
May 4, 2005. See 2005 NPRM. In addition to proposing possible 
modifications to the FEA definitions affected by the Shays decision, 
the 2005 NPRM also proposed several changes to the definition of ``in 
connection with an election in which a candidate for Federal office 
appears on the ballot'' in 11 CFR 100.24(a)(1).
    The 2005 NPRM sought comment on three proposed exceptions to the 
Type II FEA time period in 11 CFR 100.24(a)(1). See 2005 NPRM, 70 FR at 
23071 and 23072. The first proposed exception would have applied to 
special elections for Federal office that are scheduled to be held on 
the same date as previously scheduled State or local elections. Id., 70 
FR at 23071. The second proposed exception would have applied to 
municipal elections that take place during the Type II FEA time period, 
but on dates other than Federal election dates. Id., 70 FR at 23071 and 
23072. The third proposed exception would have taken a narrower 
approach, excepting only GOTV activities within 72 hours before a non-
Federal election. Id., 70 FR at 23071.
    The Commission received several comments on the issues raised in 
the 2005 NPRM.\3\ Some commenters opposed any further restrictions on 
when activity will be considered FEA as contrary to Congress's intent 
in BCRA. Other commenters supported the proposed exceptions and the 
Commission's attempt to limit the scope of the FEA requirements. Some 
commenters gave examples of municipal elections that were scheduled 
within Type II FEA time periods and argued that an exception for these 
municipal elections was appropriate and necessary. One commenter who 
generally supported the exceptions sought clarification as to how the 
municipal election exception would apply to State and local political 
party committees in States where some of the municipal elections met 
the requirements of the exception. This commenter noted that the 
proposal did not address whether all of a State political party 
committee's activities would enjoy the exception if one municipality in 
the State had an election that met the requirements of the exception, 
and if not, how the State political party committee should divide its 
Type II FEA into excepted and not excepted FEA.
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    \3\ All comments and a transcript of the public hearing related 
to the 2005 NPRM are available at http://www.fec.gov/law/law_rulemakings.shtml under ``Definition of Federal Election Activity.''
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    After reviewing written comments on the 2005 NPRM and conducting a 
public hearing on August 4, 2005, the Commission approved Final Rules 
and an Explanation and Justification on the Definition of Federal 
Election Activity. See 2006 Final Rules. The Commission decided not to 
amend the definition of ``in connection with an election in which a 
candidate for Federal office appears on the ballot'' by incorporating 
any of the proposed exceptions as part of the 2006 Final Rules. Rather, 
the Commission decided to promulgate a more narrowly focused final 
rule, but also wanted the benefit of comments on the final rule. Thus, 
the Commission is adopting this interim final rule so that new rules on 
FEA will operate seamlessly while the Commission acts to finalize the 
definition of ``FEA.''

[[Page 14359]]

New 11 CFR 100.24(a)(1)(iii)--Voter Identification and Get-Out-the-Vote 
Activities Limited to Non-Federal Elections

    BCRA requires State, district, and local political party committees 
and organizations to finance FEA with Federal funds or, in some 
instances, with an allocated mix of Federal funds and Levin funds. 2 
U.S.C. 441i(b). One of the principal sponsors of BCRA described its FEA 
provisions as ``a balanced approach which addresses the very real 
danger that Federal contribution limits could be evaded by diverting 
funds to State and local parties,'' while ``not attempt[ing] to 
regulate State and local party spending where this danger is not 
present, and where State and local parties engage in purely non-Federal 
activities.'' 148 Cong. Rec. S2138 (daily ed. Mar. 20, 2002) (Statement 
of Sen. McCain).
    BCRA does not authorize the Commission to regulate voter 
identification and GOTV activity by State, district, and local 
political party committees and certain other groups that are 
exclusively in connection with non-Federal elections. Yet under the 
current regulation, that is exactly what can happen. Scores of 
communities of all sizes--from large cities like Orlando, Florida; 
Sacramento, California; and Norfolk, Virginia; to small cities like 
Sand Springs, Oklahoma--conduct entirely non-Federal elections that 
fall within Type II FEA time periods because of Federal elections that 
are held on a later date in the election cycle. See, e.g., http://www.usmayors.org/uscm/elections/99elections.asp?Action=View (listing 
previous mayoral elections by date) (last visited Mar. 8, 2006). 
Moreover, some of the amendments adopted in the 2006 Final Rules, 
adopted pursuant to the Shays decision, bring FEA conducted by 
associations of local candidates within BCRA's funding restrictions. 
Under the regulations as revised by the 2006 Final Rules, even a non-
partisan association of non-Federal candidates would be required to use 
Federal funds for FEA.
    The Commission, therefore, is adopting an interim final rule that 
better distinguishes between voter identification and GOTV activities 
that are FEA, and those activities that are not FEA because they do not 
involve elections in which Federal candidates are on the ballot. See 2 
U.S.C. 431(20)(A)(ii); new 11 CFR 100.24(a)(1)(iii). The interim final 
rule is a narrower measure than the exceptions proposed in the 2005 
NPRM in several respects.
    First, proposals in the 2005 NPRM would have excepted all forms of 
Type II Federal election activities based only on the fact that they 
preceded the date of a municipal election. Instead of using timing as 
the dispositive factor, the interim final rule includes affirmative 
requirements for the content of the communications and activities that 
must be satisfied to ensure that the interim final rule applies only to 
communications and activities that are solely in connection with an 
election in which no Federal candidate appears on the ballot. Second, 
the interim final rule does not apply to purely generic campaign 
activity, as discussed further below. The interim final rule's approach 
of focusing on the nature of the voter identification and GOTV efforts, 
both of which relate to specific candidates or particular elections, 
represents a more tailored approach that would avoid imposing Federal 
funding restrictions on efforts related to non-Federal elections that 
simply happen to fall within the Type II FEA time periods. Finally, the 
interim final rule is effective for a limited duration. See new section 
100.24(a)(1)(iii)(B).
    New section 100.24(a)(1)(iii) requires that a non-Federal election 
must be held on a date separate from any Federal election and the 
communication or activity must be in connection with the non-Federal 
election. Any activity that is also in connection with a Federal 
election renders the interim final rule inapplicable.
    Under the interim final rule, the activity or communication must 
refer exclusively to one or more of the following three topics: (1) The 
non-Federal candidates on the ballot; (2) ballot initiatives or 
referenda; or (3) the date, time, and polling locations of the non-
Federal election. 11 CFR 100.24(a)(1)(iii)(A)(1) to (3). If a non-
Federal candidate is also seeking Federal office and has satisfied 
FECA's definition of ``candidate,'' then references to that candidate 
would not qualify for the interim final rule. The ``exclusive'' 
requirement of new section 100.24(a)(1)(iii)(A) means that the activity 
or communication may not refer to candidates or elections other than 
the non-Federal election that triggers new section 100.24(a)(1)(iii). 
For an activity to be covered by the interim final rule, it must 
include a communication that addresses one or more of the three topics 
listed in section 100.24(a)(1)(iii)(A)(1) to (3).
    In contrast, generic campaign activity, by definition, promotes a 
political party and does not promote a Federal or non-Federal 
candidate, so generic campaign activity cannot satisfy the requirement 
of ``exclusively'' referring to non-Federal candidates, ballot 
initiatives, or non-Federal polling place and time information. See 2 
U.S.C. 431(21); see also 11 CFR 100.25. No generic campaign activity, 
therefore, will satisfy the requirements of the interim final rule. 
Thus, the interim final rule operates so that it can apply only to 
voter identification and GOTV activities. The Commission seeks comment 
on whether this is an appropriate determination or whether generic 
campaign activities should be included when the Commission promulgates 
a final rule.
    Voter identification and GOTV activities can include a generic 
component and remain eligible for the interim final rule. For example, 
a GOTV phone bank that urges voters to vote for ``Smith, the Democratic 
candidate for Mayor'' and that also refers to ``the great Democratic 
team'' could qualify for the interim final rule (assuming it meets the 
other requirements of 11 CFR 100.24(a)(1)(iii)).
    Voter list acquisition generally will not qualify for the interim 
final rule because most State, district and local party committees and 
organizations will acquire voter lists for use in connection with more 
than one election.\4\ However, if a State, district, or local party 
committee or organization were to acquire a voter list to conduct GOTV 
activities and/or voter identification exclusively for a municipal 
election,\5\ acquisition of the voter list would not be Type II FEA. 
Under these circumstances, the interim final rule permits a State, 
district or local party committee or organization to use an allocable 
mix of Federal and non-Federal funds under 11 CFR 106.7(b), (c)(3), and 
(c)(5) to acquire this voter list.\6\
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    \4\ State, district and local party committees would also have 
to use at the list in an activity that refers exclusively to one or 
more of the three topics listd in new section 
100.24(a)(1)(iii)(A)(1) through (3).
    \5\ References to municipal elections are exemplary only; new 
section 100.24(a)(1)(iii) applies to all types of non-Federal 
elections that are held on dates separate from dates of any Federal 
elections.
    \6\ Pursunt to 11 CFR 106.7(b) political party organizations 
that are not political committees under FECA may establish separate 
Federal and non-Federal accounts or use a ``reasonable accounting 
method approved by the Commision'' to allcoate their voter drive 
expenses between Federal and non-Federal funds.
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    For example, if a local party committee chooses to acquire a list 
of voters for a municipal election during the Type II FEA time period, 
the voter list must be the closest available to the list of eligible 
voters in the non-Federal election. If a municipality is conducting an 
election during the Type II FEA time

[[Page 14360]]

period, but only a countywide voter list is available, acquisition of 
the that voter list would still fall within new section 
100.24(a)(1)(iii) and would not be Type II FEA. However, if the local 
party committee acquires a voter list that is for a geographic region 
that is larger than the municipality conducting the non-Federal 
election and a small voter list covering the municipality is available, 
the acquisition of the larger voter list would be Type II FEA. Choosing 
a list of voters that goes beyond the voters participating in the 
municipal election demonstrates that the voter identification program 
is not exclusively in connection with the municipal election.
    The interim final rule is consistent with section 441i(b) of BCRA, 
which seeks to regulate the funds used for Type II FEA that are in 
connection with Federal elections by State, district, and local 
political party committees and organizations. In defining ``FEA,'' BCRA 
limited the definition to voter registration activity within 120 days 
of a Federal election and to Type II FEA that are ``in connection 
with'' an election in which a Federal candidate appears on the ballot. 
See 2 U.S.C. 431(20)(A)(i) and (ii). Thus, BCRA recognizes that some 
voter registration activity, voter identification, GOTV activity, and 
generic campaign activity is not FEA. New section 100.24(a)(1)(iii) 
applies only to voter identification and GOTV activities that are not 
``in connection with an election in which a candidate for Federal 
office appears on the ballot,'' as required by BCRA.
    The interim final rule will not lead to circumvention of BCRA. The 
definition of ``FEA'' as amended by the interim final rule fully 
captures the activities Congress sought to subject to BCRA's funding 
restrictions. As noted above, the FEA provisions in BCRA address ``the 
very real danger that Federal contribution limits could be evaded by 
diverting funds to State and local parties,'' and it does so ``while 
preserving the rights and abilities of our State and local parties to 
engage in truly local activity.'' See 148 Cong. Rec. S2138 (daily ed. 
Mar. 20, 2002) (Statement of Sen. McCain). The new interim final rule 
does not create an opportunity for such evasion because the 
communications and activities that fall within the rule are ``purely 
non-Federal activities,'' which the FEA provisions were not intended to 
reach. See id. Lastly, State, district, and local political party 
committees and organizations must continue to use an allocable mix of 
Federal and non-Federal funds to pay for any communications or 
activities covered by the new interim final rule. See 11 CFR 106.7(b), 
(c)(3), and (c)(5). Therefore, even under the new interim final rule, 
use of non-Federal funds for those communications and activities 
remains limited.

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

    The Commission certifies that the attached interim final rule will 
not have a significant economic impact on a substantial number of small 
entities. The basis for this certification is that the organizations 
affected by this rule are State, district, and local political party 
committees, which are not ``small entities'' under 5 U.S.C. 601. These 
not-for-profit committees do not meet the definition of ``small 
organization,'' which requires that the enterprise be independently 
owned and operated and not dominant in its field. 5 U.S.C. 601(4). 
State political party committees are not independently owned and 
operated because they are not financed and controlled by a small 
identifiable group of individuals, and they are affiliated with the 
larger national political party organizations. In addition, the State 
political party committees representing the Democratic and Republican 
parties have a major controlling influence within the political arena 
of their State and are thus dominant in their field. District and local 
party committees are generally considered affiliated with the State 
committees and need not be considered separately. To the extent that 
any State party committees representing minor political parties might 
be considered ``small organizations,'' the number affected by this rule 
is not substantial. Finally, new Sec.  100.24(a)(1)(iii) operates to 
relieve funding restrictions, which reduces the economic impact on any 
affected entities.

List of Subjects in 11 CFR Part 100

    Elections.

0
For the reasons set out in the preamble, Subchapter A of Chapter 1 of 
Title 11 of the Code of Federal Regulations is amended as follows:

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

0
1. The authority citation for 11 CFR part 100 continues to read as 
follows:

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


0
2. In Sec.  100.24, paragraph (a)(1)(iii) is added to read as follows:


Sec.  100.24  Federal Election Activity (2 U.S.C. 431(20)).

    (a) * * *
    (1) * * *
    (iii) Voter Identification and Get-Out-the-Vote Activities Limited 
to Non-Federal Elections.
    (A) Notwithstanding paragraphs (a)(1)(i) and (ii) of this section, 
in connection with an election in which a candidate for Federal office 
appears on the ballot does not include any activity or communication 
that is in connection with a non-Federal election that is held on a 
date separate from a date of any Federal election and that refers 
exclusively to:
    (1) Non-Federal candidates participating in the non-Federal 
election, provided the non-Federal candidates are not also Federal 
candidates;
    (2) Ballot referenda or initiatives scheduled for the date of the 
non-Federal election; or
    (3) The date, polling hours and locations of the non-Federal 
election.
    (B) Paragraph (a)(1)(iii) of this section shall not apply to any 
activities or communications after September 1, 2007.
* * * * *

    Dated: March 16, 2006.
Michael E. Toner,
Chairman, Federal Election Commission.
[FR Doc. 06-2766 Filed 3-21-06; 8:45 am]
BILLING CODE 6715-01-P