To this end, we urge your Committee to report out a campaign financing bill which will make it financially, legally, and procedurally possible to achieve a fair, clean, and vigorously viable first election for the too-long disenfranchised citizens of the District of Columbia. We thank you, Mr. Chairman, for the opportunity of expressing our additional views on the subject, which, together with our previous comments of April 4th, we ask be incorporated in and made a part of the hearing record, as previously stated. With most cordial regards and esteem, I remain, Very sincerely yours, JOHN B. DUNCAN, President. COMPTROLLER GENERAL OF THE UNITED STATES, Hon. CHARLES C. DIGGS, Jr., Chairman, Committee on the District of Columbia, DEAR MR. CHAIRMAN: Section 301 (a) of the District of Columbia Campaign Finance Reform and Conflict of Interest Act, as passed by the Senate on June 27, 1974 (Vol. 120, No. 95, Cong. Record, pp. $11613-11620), provides that upon enactment the Comptroller General shall appoint or designate an acting Director of Campaign Finance to have the powers and perform the duties of that office, pending the permanent appointment of a Director by the Commissioner of the District of Columbia and confirmation by the Senate. We are of the view that it would be better if our Office were not to participate in the appointive process, even to the limited extent of designating an acting director. Such participation might compromise the position of the General Accounting Office, as an independent agent of the legislative branch of the Government, in the audit and review of the activities of the Board of Elections, as required by the last sentence of section 304 of the bill as passed by the Senate. We note that the bill passed by the House of Representatives provides that the Director be appointed by the Board of Elections. We note also that the House bill provides for the Director to serve at the pleasure of the Board. The Senate bill, by making provision neither for a term of office for the Director, nor for his removal, apparently establishes an undefined tenure. Section 304 of both bills provides for assistance to the Board by the General Accounting Office. In addition, the Senate bill provides express authority to conduct such audits and investigations as the Comptroller General determines necessary. It is our view that the assistance to be rendered under the provisions of the House bill and the first sentence of the Senate bill should be advisory only and should not operate in derogation of the Board's authority or responsibilities. Sufficient copies of this letter are being provided for each of the House conferees on the bill. Sincerely yours, ELMER B. STAATS. Comptroller General of the United States. AMENDMENTS FOR FULL COMMITTEE ACTION EXPLANATION OF AMENDMENT TO DELETE 401 (f) WHICH PROHIBITS CONTRIBUTIONS BY CORPORATIONS AND LABOR UNIONS The only states which have a provision like 401 (f) prohibiting labor unions to contribute to state and local elections are: Arizona, Indiana, Maryland, New Hampshire, Pennsylvania. All states except 19 prohibit corporate contributions. Of course, both are prohibited under federal law for presidential and Congressional elections. Each local union and central body has its own procedures for making endorsements and authorizing contributions from dues money. EXPLANATION OF AMENDMENT TO DELETE THE D.C. DELEGATE TO THE HOUSE FROM COVERAGE BY THIS BILL The subcommittee voted to add the D.C. Delegate to the municipal officers covered in this bill. The vote was 2 for and 1 against. The Delegate is presently covered by the Federal Election Campaign Act of 1971 and files the same periodic reports with the Clerk of the House as other members of the House. EXPLANATION OF AMENDMENT TO RAISE THE CEILING ON EXPENDITURES FOR CITY-WIDE RACES The amendment changes the following ceilings now in H.R. 14754, the subcommittee bill: Mayor-$100,000 to $150.000 (for the primary and again for the general). Council Chairman-$75,000 to $100,000 (for the primary and again for the general). Council-At-Large-$50,000 to $75,000 (for the primary and again for the general). The ceilings in the subcommittee bill range from as low as 63 cents per capita for the primary election for at-large council members, to as high as 214 cents per capita for the primary election for ward candidates for Council. The same amount can be spent for the general. The amendment leaves the ward candidate's ceiling at 214 cents, but raises the ceilings for primary election for citywide races to: Mayor-20 cents per capita. Council Chmn-131⁄2 cents per capita. Successful candidates in the September primary, and independent candidates would be allowed to spend the same amount for the general in November. The Senate-passed bill for federal elections (S. 3044, now in the House Administration Committee) sets a ceiling of about 20 cents per capita for the primary election in a typical Congressional District and the same for the general election. Testimony and statements in the committee record include cost estimates for a combined primary and general election in Washington, D.C. as high as the following: $400,000 (material submitted by Ben Gilbert, for the District Government). $300,000 to $400,000 (John Dean, campaign manager for Mayor Walter Washington). $300,000 (Board of Trade). EXPLANATION OF AMENDMENT TO CHANGE "DIVISION OF CAMPAIGN FINANCE" TO "DIRECTOR OF CAMPAIGN FINANCE" The subcommittee bill creates a three-member division within the three-member Board of Elections to administer this law. The Division would have both rulemaking and administrative authority. (418) The amendment, drafted with the advice and assistance of GAO (who administer the federal reporting law), gives administrative authority to a new Director of Campaign Finance and leaves the policy and rule-making responsibility with the Board of Elections, as in present D.C. law. Additional enforcement powers including seeking injunctive relief in the courts as provided in the subcommittee bill are retained. The District Government objects to the Division created in the subcommittee bill as "an unclear division of authority". The subcommittee bill provides that two members of the division shall be appointed by the Unified Bar of D.C. An official of the bar has expressed surprise at this provision because, unlike the Bar's role in the Judicial Nomination Commission, the Bar has no special expertise in elections. EXPLANATION OF AMENDMENT TO PERMIT WARD CANDIDATES TO SPEND $2,000 OF THEIR OWN FUNDS, JUST AS AT-LARGE CANDIDATES ARE PERMITTED On page 27 line 17 is language that restricts what a candidate can spend of his own funds on his campaign. Testimony from ward condidates for city council argued that the $400 for the primary and $400 for the general permitted for them was too low. They were nearing $400 from the first few weeks of getting organized. EXPLANATION OF AMENDMENT TO PERMIT PRESENT CITY COUNCIL TO AMEND THIS LAW This bill has been necessary because the Home Rule Act gives authority over election laws to the new city council, but not the present city council. This amendment woudl permit corrections or modifications of this bill to be made, if the need arises, without coming back to Congress during the coming months. EXPLANATION OF AMENDMENT TO LIMIT INDEPENDENT EXPENDITURES NOT AUTHORIZED BY A CANDIDATE (AS CONTRASTED WITH POLITICAL CONTRIBUTIONS) The basic theory of this bill is that a candidate is responsible for all campaign expenditures being made in his name and must keep them below the stated ceilings. This amendment spells that concept out more clearly. It does not prohibit anyone from spending money on the candidate without his permission, but limits that unauthorized expenditures to $1,000. Without that restraint, any person could place an expensive series of TV spot commercials, for example, and avoid the candidate's ceiling by saying he didn't seek the consent of the candidate. Without that restraint others could make ineffective even purposefully ineffective expenditures in the cndidate's name and reach his ceiling and stop him from spending on his own campaign. This amendment is taken from the Mathias-Fraser bill and from S. 30444, the Senate-passed bill. EXPLANATION OF AMENDMENT TO LET CEILINGS ON CONTRIBUTIONS CANDIDATE BY CANDIDATE (SEC. 401 (b)) BE THE AGGREGATE CEILING FOR CONTRIBUTIONS FROM GROUPS This amendment remove the $4,000 primary and $4.000 general aggregate ceiling on contributions from groups, set on line 4 of page 28 of the subcommittee bill. Thus groups will be able to contribute in as many races as they wish, being limited only by the candidate maximums set in 401(b)—$400 in the primary to a ward candidate, $2,000 in the primary for the Mayor, etc.) Otherwise a COPE or BI-PAC or other group contributing $2,000 to a mayoral candidate and $1,500 to a candidate for Council Chairman, would be restricted to $500 that would have to be spread among the other 12 offices up for election this fall. SUMMARY OF D. C. CAMPAIGN FINANCING BILL H.R. 15074 PRINCIPAL CAMPAIGN COMMITTEE Present D.C. Law has this requirement by regulation of Board of Elections. H.R. 15074 (Sec. 202) requires a candidate to have a main committee to which all other committees must channel their reports so that the candidate is responsible for not extending the expenditure limits. CAMPAIGN DEPOSITORY Present D.C. law has this provision by regulation of Board of Elections. H.R. 15074 (Sec. 203) requires a candidate and a committee to have a central campaign depository into which all contributions must be deposited and out of which all campaign expenditures must be made. A small petty cash fund is permitted. REGISTRATION OF CANDIDATE AND POLITICAL COMMITTEES Present D.C. law requires registration of committees but not of candidates. H.R. 15074 (Sec. 204, 205) requires candidates and committees to register with the Board of Elections. ORGANIZATION OF POLITICAL COMMITTEES Present D.C. law requires a chairman and treasurer and a D.C. address for a committee and requires certain records to be kept. H.R. 15074 (Sec. 201) adds requirement of registering campaign depositories and safe deposit boxes. REPORT BY POLITICAL COMMITTEES AND CANDIDATES Present D.C. law requires reports 5 days before and 30 days after an election. H.R. 15704 (Sec. 206) lists reporting requirements starting March 10 of election years. ELECTIONS TO WHICH LIMITATIONS AND REPORTING APPLY The present D.C. law exempts the D.C. Delegate to the U.S. House of Representatives, who is covered by the federal limitations and reporting law. H.R. 15074 also exempts the Delegate. ASSISTANCE FROM COMPTROLLER GENERAL OF THE U.S. (GAO) Present D.C. law has no provision. H.R. 15074 (Sec. 304) provides that the District may request assistance from GAO. LIMITATIONS ON CONTRIBUTIONS BY AN INDIVIDUAL AND BY A PERSON Present D.C. law permits $5,000 for each of several campaigns for election with no overall maximum. H.R. 15074 (Sec. 401) sets varying limits about one third of one percent for individuals and two third percent for persons of the maximum that a candidate can spend in an election under Sec. 402, and an overall maximum for an individual's contributions for all candidates. A volunteer's time will be exempt. LIMIT LARGE CONTRIBUTIONS TO CHECK Present D.C. law has no provision. A $50 limit for a cash contribution is set in H.R. 15074 (Sec. 401(d)). PROHIBITION ON CORPORATION AND LABOR CONTRIBUTIONS Present D.C. law has no provision. The bill (Sec. 401(g)) prohibits contributions and expenditures by these groups but permits non-partisan registration and get-out-the-vote campaigns with corporate or labor funds and the use of such committees as COPE and BIPAC. LIMITATIONS ON EXPENDITURES Present D.C. law permits a committee to spend $100,000 but does not prevent a candidate from using several committees each spending $100,000. H.R. 15074 (Sec. 402) provides separate ceilings for each D.C. election for office and for the primary and general elections. A candidate for mayor may spend $150,000 in the primary and $150,000 in the general. Candidates for other offices have lower ceilings. LIMIT INDEPENDENT EXPENDITURES NOT AUTHORIZED BY A CANDIDATE The bill (Sec. 401 (d)) sets a $1,000 a year limit on independent expenditures a person makes in support of a candidate but without his approval. TAX INCENTIVE FOR CAMPAIGN CONTRIBUTIONS In the D.C. individual income tax law, there is no allowance for itemized deductions or tax credit for political contributions. The federal law permits both. H.R. 15074 (Sec. 602) provides a $12.50 credit per person on the individual income tax. AGENCY TO ENFORCE REPORTING AND LIMITATION LAW Present D.C. law has the Board of Elections responsible. Under H.R. 15074 Title III the Board would appoint a "Director of Campaign Finance" to administer the law. REGISTRATION OF LOBBYISTS Persons lobbying with the new City Council will register and report expenditures, under Title V of the bill. OTHER SUGGESTED AMENDMENTS TO ELECTION LAW Sec. 605 requires the new City Council to study the question of whether such reforms should be adopted as: (1) Public financing of elections, (2) A new commission, (3) Voting machines, (4) Lobbying, (5) Conflict of interest, (6) Disclosure of financial interests of candidates. |