Rule2022-12771
Reporting Independent Expenditures
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 14, 2022
Effective
September 30, 2022
Issuing agencies
Federal Election Commission
Abstract
The Federal Election Commission is removing a regulation requiring that certain persons making independent expenditures disclose on their reports the identification of each person who made a contribution over $200 to the persons filing such reports "for the purpose of furthering the reported independent expenditure." The Commission is taking this action to comply with the decision of the United States Court of Appeals for the District of Columbia Circuit, which affirmed a district court decision holding that the disclosure regulation was invalid. The Commission is accepting comments on this revision to its regulation and any comments received may be addressed in a subsequent rulemaking document. Further information is provided in the SUPPLEMENTARY INFORMATION that follows.
Full Text
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<title>Federal Register, Volume 87 Issue 114 (Tuesday, June 14, 2022)</title>
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[Federal Register Volume 87, Number 114 (Tuesday, June 14, 2022)]
[Rules and Regulations]
[Pages 35863-35864]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-12771]
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FEDERAL ELECTION COMMISSION
11 CFR Part 109
[Notice 2022-13]
Reporting Independent Expenditures
AGENCY: Federal Election Commission.
ACTION: Interim final rule.
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SUMMARY: The Federal Election Commission is removing a regulation
requiring that certain persons making independent expenditures disclose
on their reports the identification of each person who made a
contribution over $200 to the persons filing such reports ``for the
purpose of furthering the reported independent expenditure.'' The
Commission is taking this action to comply with the decision of the
United States Court of Appeals for the District of Columbia Circuit,
which affirmed a district court decision holding that the disclosure
regulation was invalid. The Commission is accepting comments on this
revision to its regulation and any comments received may be addressed
in a subsequent rulemaking document. Further information is provided in
the SUPPLEMENTARY INFORMATION that follows.
DATES: The interim final rule is effective on September 30, 2022.
Comments must be received on or before July 14, 2022.
ADDRESSES: All comments must be in writing. Commenters are encouraged
to submit comments electronically via the Commission's website at
<a href="https://sers.fec.gov/fosers/">https://sers.fec.gov/fosers/</a>, reference REG 2020-05. Alternatively,
commenters may submit comments in paper form, addressed to the Federal
Election Commission, Attn.: Mr. Robert M. Knop, Assistant General
Counsel, 1050 First Street NE, Washington, DC 20463.
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, 1050 First Street
NE, Washington, DC 20463, (202) 694-1650 or (800) 424-9530.
SUPPLEMENTARY INFORMATION: The Federal Election Campaign Act (the
``Act'') provides that any person that is not a political committee and
that makes independent expenditures aggregating in excess of $250 per
calendar year must file a statement containing certain information
about the funds they received and spent, including identifying each
person (other than a political committee) whose contributions to the
person filing such statement aggregated in excess of $200 within the
calendar year, together with the date and amount of such contribution.
52 U.S.C. 30104(c)(1); see also 52 U.S.C. 30104(b)(3)(A). The Act also
provides that the statement must identify ``each person who made a
contribution in excess of $200 to the person filing such statement
which was made for the purpose of furthering an independent
expenditure.'' 52 U.S.C. 30104(c)(2)(C).
To implement these and other independent expenditure reporting
provisions of the Act, the Commission promulgated the regulation at 11
CFR 109.10, requiring that ``[e]very person that is not a political
committee and that makes independent expenditures aggregating in excess
of $250 with respect to a given election in a calendar year shall file
a verified statement or report . . .'' including certain information
about the expenditures and ``[t]he identification of each person who
made a contribution in excess of $200 to the person filing such report,
which contribution was made for the purpose of furthering the reported
independent expenditure.'' 11 CFR 109.10(b), (e)(1)(vi).
On Aug. 3, 2018, the United States District Court for the District
of Columbia Circuit held that the regulation at 11 CFR 109.10(e)(1)(vi)
is invalid because it conflicts with the terms of the statute, which
``mandate significantly more disclosure than that required by the
challenged regulation.'' CREW v. FEC, 316 F. Supp. 3d 349, 410 (D.D.C.
2018). The district court held that 52 U.S.C. 30104(c)(1) ``plainly
requires broader disclosure than just those donors making contributions
for the purposes of funding the independent expenditures made by the
reporting entity.'' Id. at 389. The district court further held that
the regulation ``substantially narrows subsection (c)(2)'' of the
statute, id. at 394, and that ``the challenged regulation's
substitution of `the reported' for `an' is not in accord with the
statutory text.'' Id. at 406. The district court therefore vacated the
regulation, effective September 17, 2018. Order, CREW v. FEC, No. 16-
259 (Aug. 3, 2018) at 2.\1\ Shortly after the vacatur of the regulation
became effective, the Commission issued guidance on how persons other
than political committees should report their independent expenditures
following the court's decision, available at: <a href="https://www.fec.gov/updates/fec-provides-guidance-following-us-district-court-decision-crew-v-fec-316-f-supp-3d-349-ddc-2018/">https://www.fec.gov/updates/fec-provides-guidance-following-us-district-court-decision-crew-v-fec-316-f-supp-3d-349-ddc-2018/</a>.
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\1\ The court stayed its vacatur of the rule for 45 days from
the date of the order.
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On August 21, 2020, the U.S. Court of Appeals for the District of
Columbia Circuit affirmed the district court's decision. CREW v. FEC,
971 F.3d 340 (D.C. Cir 2020). The D.C. Circuit found that 11 CFR 109.10
``disregards [52 U.S.C. 30104](c)(1)'s requirement that IE makers
disclose each donation from contributors who give more than $200 . . .
.'' Id. at 350-51. It also found that the regulation ``impermissibly
narrows [52 U.S.C. 30104](c)(2)(C)'s requirement that contributors be
identified if their donations are `made for the purpose of furthering
an independent expenditure' '' by requiring disclosure only of
donations linked to a particular independent expenditure. Id. at 351.
The court concluded that, because the statute ``establishes a broader
disclosure mandate than the [Commission's] Rule ostensibly implementing
it, the Rule is invalid.'' Id. at 356.
Commissioners have previously made efforts to reach consensus on
revising the regulatory description of the reporting requirements, but
were unable to find agreement by the required four affirmative votes.
In order to conform with the court opinion, the Commission is now
striking 11 CFR 109.10(e)(1)(vi). The
[[Page 35864]]
Commission is adding a note to 11 CFR 109.10(e)(1) citing to the
District Court and Court of Appeals decisions relating to this matter
stating that the statutory provision at 52 U.S.C. 30104(c) remains in
force.
The Commission is issuing this rule as an interim final rule. This
interim final rule will take effect thirty legislative days after its
transmittal to Congress. See 52 U.S.C. 30111(d). The Commission
welcomes public comment on this interim final rule and may address any
comments received in a later rulemaking.
The Administrative Procedure Act (``APA'') requires an agency
promulgating regulations to publish a notice of a proposed rulemaking
in the Federal Register. 5 U.S.C. 553(b). The notice requirement does
not apply, however, ``when the agency for good cause finds (and
incorporates the finding and a brief statement of reasons therefor in
the rules issued) that notice and public procedure thereon are
impracticable, unnecessary, or contrary to the public interest.'' 5
U.S.C. 553(b)(B). According to the APA's legislative history, a
situation is ``impracticable'' when ``the due and required execution of
the agency functions would be unavoidably prevented by its undertaking
public rule-making proceedings.'' See Administrative Procedure Act:
Legislative History, S. Doc. No. 248 79-258 (1946); see also Attorney
General's Manual on the Administrative Procedure Act 15 (1947). ``
`Unnecessary' means unnecessary so far as the public is concerned, as
would be the case if a minor or merely technical amendment in which the
public is not particularly interested were involved.'' Id. ``Contrary
to the public interest'' connotes a situation in which the interest of
the public would be defeated by any requirement of advance notice. Id.
The notice to remove 11 CFR 109.10(e)(1)(vi) is unnecessary because
that regulatory provision that has already been invalidated by a
federal court and cannot be enforced. 5 U.S.C. 553(b)(B). Removing this
provision from the regulations does not involve any exercise of
discretion by the Commission. Moreover, because this provision is
already unenforceable, the Commission's action will not affect the
rights or interests of any person or entity, nor could the public
notice and comment period benefit the Commission in this rulemaking.
In addition, a notice and comment period may be contrary to the
public interest. The Commission notes that the 2022 elections for
federal office are scheduled to take place on November 8, 2022.
Although, as noted above, the Commission previously issued guidance on
reporting requirements to the regulated community, the fundamental part
of that guidance should be reflected in the Commission's regulation as
soon as possible before the general election.
In addition, because this interim final rule is exempt from the
notice and comment procedure under 5 U.S.C. 553(b), the Commission is
not required to conduct a regulatory flexibility analysis under 5
U.S.C. 603 and 604 (Regulatory Flexibility Act). See 5 U.S.C. 601(2)
and 604(a).
List of Subjects in 11 CFR Part 109
Coordinated and independent expenditures.
For the reasons set out in the preamble, the Commission is amending
11 CFR part 109 as follows:
PART 109--COORDINATED AND INDEPENDENT EXPENDITURES (52 U.S.C.
30101(17), 30116(a) AND (d), AND PUBLIC LAW 107-155 SEC. 214(C))
0
1. The authority citation for part 109 continues to read as follows:
Authority: 52 U.S.C. 30101(17), 30104(c), 30111(a)(8), 30116,
30120; Sec. 214(c), Pub. L. 107-155, 116 Stat. 81.
0
2. Section 109.10 is amended by removing and reserving paragraph
(e)(1)(vi) and by adding a note to paragraph (e)(1).
The addition reads as follows:
Sec. 109.10 How do political committees and other persons report
independent expenditures?
* * * * *
(e) * * *
(1) * * *
Note to Sec. 109.10(e)(1): On August 3, 2018, the United States
District Court for the District of Columbia vacated 11 CFR
109.10(e)(1)(vi). CREW v. FEC, 316 F. Supp. 3d 349 (Aug. 3, 2018),
aff'd, 971 F.3d 340 (D.C. Cir. 2020). Section 30104(c) of title 52
of the U.S. Code and the remaining provisions of 11 CFR 109.10
remain in force.
* * * * *
Dated: June 8, 2022.
On behalf of the Commission,
Allen J. Dickerson,
Chairman, Federal Election Commission.
[FR Doc. 2022-12771 Filed 6-13-22; 8:45 am]
BILLING CODE 6715-01-P
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</html>Indexed from Federal Register on June 14, 2022.
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