[Federal Register Volume 86, Number 148 (Thursday, August 5, 2021)]
[Proposed Rules]
[Pages 42753-42754]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-16614]


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FEDERAL ELECTION COMMISSION

11 CFR Parts 104 and 109

[Notice 2021-11]


Rulemaking Petition: Subvendor Reporting

AGENCY: Federal Election Commission.

ACTION: Rulemaking Petition: Notification of availability.

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SUMMARY: On June 29, 2021, the Federal Election Commission received a 
Petition for rulemaking asking the Commission to amend its existing 
regulations regarding reporting expenditures and certain other 
disbursements. The proposed amendments would require political 
committees and persons who make independent expenditures and 
electioneering communications to itemize certain payments made by 
vendors to others on behalf of the reporting entities.

DATES: Comments must be submitted on or before October 4, 2021.

ADDRESSES: All comments must be in writing. Commenters may submit 
comments electronically via the Commission's website at http://sers.fec.gov/fosers/, reference REG 2021-02.
    Each commenter must provide, at a minimum, his or her first name, 
last name, city, and state. All properly submitted comments, including 
attachments, will become part of the public record, and the Commission 
will make comments available for public viewing on the Commission's 
website and in the Commission's Public Records Office. Accordingly, 
commenters should not provide in their comments any information that 
they do not wish to make public, such as a home street address, 
personal email address, date of birth, phone number, social security 
number, or driver's license number, or any information that is 
restricted from disclosure, such as trade secrets or commercial or 
financial information that is privileged or confidential.

FOR FURTHER INFORMATION CONTACT: Mr. Robert M. Knop, Assistant General 
Counsel, or Ms. Joanna S. Waldstreicher, Attorney, Office of the 
General Counsel, at [email protected].

SUPPLEMENTARY INFORMATION: On June 29, 2021, the Commission received a 
Petition for Rulemaking from the Campaign Legal Center and the Center 
on Science & Technology Policy at Duke University (``Petition''). The 
Petition asks the Commission to amend its regulations at 11 CFR 
104.3(b), 109.10(e), and 104.20(c), to require that persons filing 
reports under those sections itemize all expenditures or disbursements 
made on behalf of or for the benefit of the political committee or 
other reporting person, including those made by an agent, independent 
contractor, vendor, or subvendor.
    The Federal Election Campaign Act (the ``Act'') and Commission 
regulations require that political committees disclose the name and 
address of each person to whom expenditures or certain other 
disbursements aggregating over $200 are made, as well as certain 
information about each expenditure or disbursement. 52 U.S.C. 
30104(b)(5)(A), (b)(6)(B)(v); 11 CFR 104.3(b)(3)(i), (b)(4)(i). The Act 
and Commission regulations also require that disbursements aggregating 
over $200 for independent expenditures and electioneering 
communications similarly be disclosed. 52 U.S.C. 30104(b)(6)(B)(iii), 
(c)(2)(A); 11 CFR 109.10(e)(1)(ii-iii) (independent expenditures); 52 
U.S.C. 30104(f)(2)(C); 11 CFR 104.20(c)(4) (electioneering 
communications).
    The Petition notes that ``if a disclosed vendor subcontracts with a 
third party, the payment to the subcontractor might not be disclosed,'' 
Petition at 1, and asserts that ``a substantial portion of FEC-reported 
political spending now consists of large payments to a small number of 
consulting firms that disguise where political money is ultimately 
going.'' Petition at 3. The Petition asserts that this lack of 
disclosure about the ultimate recipients and purposes of political 
spending has a number of negative consequences: it ``deprives voters of 
information they use to assess candidates and cast informed votes,'' 
Petition at 4; it ``becomes nearly impossible for researchers and 
academics to monitor digital political ad practices,'' id.; it allows 
reporting entities to ``disguise FECA violations, such as violations of 
the personal use ban'' and ``evidence of common vendor coordination 
between an authorized committee and a super PAC,'' Petition at 5; and 
it can ``provide further cover for so-called `scam PACs,''' Petition at 
6.
    The Petition asks the Commission to amend 11 CFR 104.3(b) to 
require additional disclosure by political committees, by adding a new 
subparagraph (5) that reads:

    (5)(i) Any person reporting expenditures or disbursements under 
this section must report expenditures or disbursements made by an 
agent or independent contractor, including any vendor or subvendor, 
on behalf of or for the benefit of the reporting person.
    (ii) An agent or contractor, including a vendor or subvendor, 
who makes an expenditure or disbursement on behalf of or for the 
benefit of a reporting committee or person that is required to be 
reported under this section shall promptly make known to the 
reporting committee or person all the information required for 
reporting the expenditure or disbursement.

Petition at 6-7.
    The Petition also asks the Commission to amend sections

[[Page 42754]]

109.10(e)(1) and 104.20(c) to add similar language requiring additional 
disclosure in relation to independent expenditures and electioneering 
communications, respectively.
    The Commission seeks comment on the Petition. The public may 
inspect the Petition on the Commission's website at http://sers.fec.gov/fosers/.
    The Commission will not consider the Petition's merits until after 
the comment period closes. If the Commission decides that the Petition 
has merit, it may begin a rulemaking proceeding. The Commission will 
announce any action that it takes in the Federal Register.

    Dated: July 29, 2021.

    On behalf of the Commission.
Shana M. Broussard,
Chair, Federal Election Commission.
[FR Doc. 2021-16614 Filed 8-4-21; 8:45 am]
BILLING CODE 6715-01-P