[Federal Register Volume 89, Number 80 (Wednesday, April 24, 2024)]
[Proposed Rules]
[Pages 31114-31116]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08698]


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FEDERAL ELECTION COMMISSION

11 CFR Part 100

[NOTICE 2024-12]


Amending Definition of Contribution to Include ``Valuable 
Information''

AGENCY: Federal Election Commission.

ACTION: Notification of Disposition of Petition for Rulemaking.

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SUMMARY: The Commission announces its disposition of a Petition for 
Rulemaking filed on April 29, 2019. The Petition asked the Commission 
to amend the existing regulation defining ``contribution'' by adding a 
new section to include within the definition of contribution certain 
``valuable information.'' The Petition would further require the 
Commission to initiate investigations and report to a law enforcement 
agency ``automatically'' and without a vote whenever the Commission 
receives notice that any person has received certain ``foreign 
information'' or ``compromising information.'' The Commission is not 
initiating a rulemaking at this time because it lacks the statutory 
authority to do so.

DATES: April 24, 2024.

FOR FURTHER INFORMATION CONTACT: Mr. Robert M. Knop, Assistant General 
Counsel, or Mr. Luis M. Lipchak, Attorney, 1050 First Street NE, 
Washington, DC 20463, (202) 694-1650 or (800) 424-9530.

SUPPLEMENTARY INFORMATION: The Federal Election Campaign Act, 52 U.S.C. 
30101-45 (the ``Act''), and Commission regulations define a 
contribution as ``any gift, subscription, loan, advance, or deposit of 
money or anything of value made by any person for the purpose of 
influencing any election for Federal office.'' \1\ ``Anything of 
value'' includes all in-kind contributions, such as the provision of 
goods and services without charge or at a charge that is less than the 
usual and normal charge.\2\ Moreover, Commission regulations identify 
the following as

[[Page 31115]]

contributions: payment for attendance at a fundraiser, political event, 
or the purchase price of a fundraising item sold by a political 
committee; \3\ compensation by a third party for personal services an 
individual provides unpaid to a political committee; \4\ an extension 
of credit, unless the extension is extended in the ordinary course of a 
person's business and under terms and conditions that are substantially 
similar to credits extended to nonpolitical entities; \5\ and anything 
of value given to a national party committee for the purchase or 
construction of an office building or facility.\6\
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    \1\ 52 U.S.C. 30101(8)(A)(i); see also 11 CFR 100.52(a).
    \2\ 11 CFR 100.52(d)(1).
    \3\ 11 CFR 100.53.
    \4\ 11 CFR 100.54.
    \5\ 11 CFR 100.55.
    \6\ 11 CFR 100.56.
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    On April 29, 2019, the Commission received a Petition for 
Rulemaking (``Petition'') from Sai, Fiat Fiendum, Inc., Make Your Laws 
PAC, Inc., and Make Your Laws Advocacy, Inc. (collectively 
``Petitioners''). The Petitioners asked the Commission to amend 11 CFR 
part 100, subpart B, by adding a new Sec.  100.57 to include within the 
definition of contribution certain ``valuable information.'' \7\
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    \7\ Petition at 3.
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    The Petition proposes to define ``valuable information'' as 
information that: (1) is not freely available to the public; (2) is 
provided to a person regulated by the Act at a cost less than the 
market rate or by a person not hired by the recipient to generate such 
information; (3) would cost a non-trivial amount for the recipient to 
obtain at their own expense; and (4) is information that would likely 
have the effect of influencing any election for Federal office or that 
parties or candidate committees have traditionally expended money to 
obtain.\8\
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    \8\ Id.
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    The proposal sets out two types of ``valuable information'' that 
would require special treatment: ``foreign information'' and 
``compromising information.'' \9\ ``Foreign information'' would include 
any information that comes from a source that is prohibited from making 
contributions under the Act.\10\ ``Compromising information'' would 
include ``any information that could be used to blackmail or otherwise 
compromise any candidate for Federal office (including indirect 
coercion, such as of a candidate's family), regardless of source.'' 
\11\
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    \9\ Id.
    \10\ Id.
    \11\ Id.
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    The Petition would require any person who receives ``foreign 
information'' or ``compromising information,'' or is offered any 
``foreign information'' or ``compromising information,'' to notify the 
Commission in writing within three days.\12\ Any ``compromising 
information'' the Commission received would have to be maintained under 
seal unless the information was otherwise available to the public, or 
all persons against whom the information could be used had consented to 
the information being made public.\13\
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    \12\ Petition at 3-4.
    \13\ Id.
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    Under the Petitioners' proposal, upon learning of any ``foreign 
information'' or ``compromising information,'' the Commission would be 
required, automatically and without a vote of the Commission, to: (1) 
initiate investigations pursuant to 11 CFR 111.3 and 111.10; (2) 
provide a report to the Federal Bureau of Investigation; and (3) in the 
case of ``compromising information,'' provide a report to every 
reasonably identifiable person against whom such information could be 
used, or whose private information is disclosed by such 
information.\14\ The Petitioners' proposal would also require the 
Commission, upon learning of any ``foreign information'' or 
``compromising information,'' to: (1) immediately provide a report to 
any other law enforcement entity with likely jurisdiction over the 
matter; (2) within 14 days, publicly issue a report on the matter, 
redacting any material under seal and any material the disclosure of 
which could compromise an ongoing law enforcement investigation; and 
(3) within 30 days after the conclusion of any law enforcement 
investigation, issue a public report on the matter, redacting any 
material under seal.\15\
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    \14\ Id.
    \15\ Id.
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    The Commission published a Notice of Availability (``NOA'') on July 
31, 2019, asking for public comment on the Petition.\16\ The Commission 
received 39 comments from individuals supporting the Petition, two from 
individuals opposing the Petition, and one from an individual posing 
several questions regarding the Petition. The Commission also received 
comments from three organizations that opposed initiating a rulemaking 
in response to the Petition. The organizational comments raised various 
concerns with the petition, including that the proposed regulations are 
vague, would lead to confusion and burdens that would unnecessarily 
implicate the First Amendment, and that, as acknowledged by the 
Petition, the Act already covers ``valuable information'' addressed by 
the proposed regulation.
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    \16\ See Notice of Availability, 84 FR 37154 (July 31, 2019).
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    One organizational commenter opposed the Petition because the 
``proposed regulatory definition is redundant'' and the information 
covered by the proposed amendment is ``already a `contribution' within 
the meaning of the Act.'' \17\ Another organizational commenter argued 
that the Petition was ``either unconstitutional or duplicative,'' that 
the proposed definitions were vague, and that the proposed enforcement 
procedures were inconsistent with the statute.\18\
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    \17\ Campaign Legal Center, Comment.
    \18\ Institute for Free Speech, Comment.
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    In deciding whether to initiate a rulemaking in response to a 
petition, the Commission generally considers five factors: (1) the 
Commission's statutory authority; (2) policy considerations; (3) the 
desirability of proceeding on a case-by-case basis; (4) the necessity 
or desirability of statutory revision; and (5) available agency 
resources.\19\ After considering these factors and reviewing the 
comments received on the Petition, the Commission has decided not to 
initiate a rulemaking at this time.
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    \19\ 11 CFR 200.5.
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    First, and most significantly, the Commission lacks the statutory 
authority to promulgate the rule sought by the Petition. The Act 
empowers the Commission to ``make, amend, or repeal such rules . . . as 
are necessary to carry out the provisions of [the] Act.'' \20\ The Act 
requires an affirmative vote of at least four Commissioners in order to 
initiate an investigation or report apparent violations to the 
appropriate law enforcement authorities.\21\ Thus, the Commission has 
no authority to promulgate a rule, as Petitioners wish, that would 
require the Commission to initiate an investigation or report an 
apparent violation to a law enforcement agency ``automatically,'' 
without a Commission vote. Furthermore, the Act prohibits the 
Commission from disclosing any information about a pending 
investigation without the written consent of the respondent.\22\ Thus, 
the Commission also lacks the authority to promulgate a rule, as the 
Petitioners propose, that would require the Commission to disseminate 
``compromising information'' or other information that may be subject 
of a pending Commission enforcement action.
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    \20\ 52 U.S.C. 30107(a)(8).
    \21\ 52 U.S.C. 30106(c), 30107(a)(9), 30109(a)(2).
    \22\ 52 U.S.C. 30109(a)(4), (12).
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    Additionally, the Commission chooses not to amend the definition of

[[Page 31116]]

contribution to include ``valuable information'' as a matter of policy, 
because such an amendment would be redundant and potentially confusing 
to the public. The existing definition of contribution includes 
``anything of value.'' \23\
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    \23\ 52 U.S.C. 30101(8)(A)(i); 11 CFR 100.52(a). See also 
Petition at 2, which acknowledges that ``valuable information'' is 
already covered by the Act (``To be absolutely clear, we believe 
that the information covered in this amendment is already a 
``contribution'' within the meaning of the Act, whether or not it is 
adopted.'').
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    Accordingly, after reviewing the comments received regarding the 
Petition and in consideration of the factors discussed, the Commission 
declines to initiate a rulemaking in response to the Petition.
    Copies of the comments and the Petition for Rulemaking are 
available on the Commission's website, https://www.fec.gov/fosers/ (REG 
2019-01 Amending Definition of Contribution to Include ``Valuable 
Information'' (2019)) and at the Commission's Public Records Office, 
1050 First Street NE, Washington, DC 20463, Monday through Friday 
between the hours of 9 a.m. and 5 p.m.

    Dated: April 18, 2024.

    On behalf of the Commission.
Sean J. Cooksey,
Chairman, Federal Election Commission.
[FR Doc. 2024-08698 Filed 4-23-24; 8:45 am]
BILLING CODE 6715-01-P