Reforming The FEC: Rulemaking Obligations Must Be Fulfilled

Law360 (October 23, 2020, 5:25 PM EDT) -- As Election Day nears, former commissioners of the Federal Election Commission discuss the biggest issues facing the FEC, which has been without a quorum since July. 


Karl Sandstrom

What is the first obligation the Federal Election Commission owes to the public? It is to tell us what the law is.

Ambiguity and uncertainty in the law leave the public guessing whether engaging in contemplated political activity would subject one to criminal or civil sanction. Doubt creates one set of rules for the bold and another for the timid.

Questions about the coverage of a tax law or a commercial regulation may be commonplace and acceptable. A lawyer advising a client in those matters identifies the risks, and the client chooses whether to accept the risk and the financial loss that might follow.

The assumption of risk, however, should not be the price that one pays for engaging in political activity. Every citizen should be able to discover what the law is when he or she is considering participating in a political campaign. Fair enforcement of the law requires fair notice of its strictures.

The greatest failing of the commission has been its collective failure to discharge this obligation — to come together and act as a body to minimize uncertainty in the law. The Federal Election Campaign Act requires that any rule of general application be initially proposed and adopted as a regulation. The regulatory process provides the public with a full opportunity to comment and requires decisions on the record and subject to judicial review.

The commission has all but abandoned rulemaking, leaving major issues unresolved. Years, or even decades, pass without instituting new rulemakings or revisiting rules that badly need repair to be effective and provide the public with needed guidance.

As a result, large swaths of political activity are left ungoverned by clear regulation. This begins with the most basic of questions: when must an organization register and report as a political committee? Is it when an organization expressly solicits and accepts more than $1,000 for the purpose of influencing a federal election as the statute seemingly commands? Or is it only when it spends most of its funds that it raises on making political contributions and expenditures that expressly advocate for or against a candidate? 

When the U.S. Supreme Court considered this question over 40 years ago in Buckley v. Valeo, it held that an entity's spending would only trigger registration and reporting if the organization's major purpose was to influence a federal election. Left unanswered was whether the solicitation and acceptance of contributions for a federal election itself would trigger registration and reporting.

The Supreme Court's major purpose test for expenditures has never been explicated by the commission, even after the Chief U.S. Circuit Judge Laurence Silberman writing for the U.S. Court of Appeals for the D.C. Circuit in the 1996 case Akins v Federal Election Commission found it badly in need of elucidation. Consequently, hundreds of millions of dollars are raised and spent every election cycle with the express purpose of influencing federal elections without full disclosure of the source of the funds.

The neglect does not end there. The regulations governing foreign nationals, government contractors, trade associations and social welfare organizations are sorely inadequate. The commission has addressed some critical questions regarding the application of the law in advisory opinions notwithstanding the law's mandate that rulemaking be used to promulgate rules of general application. Issues that broadly impact the law's ability to achieve its core purposes are either left unaddressed or are addressed, often obliquely, in the narrow confines of an advisory opinion. 

As a result, there is no regulation that governs a federal candidate's participation in a fundraising event that raises unlimited contributions to committees and organizations that may be actively supporting his or her candidacy or a colleague's election. The candidate's participation in such an event is only addressed in a discursive discussion in an advisory opinion.

Nor is there a regulation that governs a foreign-controlled domestic company's involvement in our nation's elections. Indeed, as previously suggested, the regulations governing foreign national participation in our election are woefully inadequate as recent events have so fully demonstrated.

What explains this institutional failure? One is its structure. The commission consists of six members. No more than three can be of one political party. To act on most matters, including all rulemakings, the commission requires the votes of four members.

What happens then if four commissioners cannot agree on what the law is? Does that mean that there is no law or that one proceeds at one's own risk? That risk is not insubstantial. A new commission, a court or a U.S. attorney may find the law to be clear even absent a regulation and proceed against a party. 

The structure of the commission, however, need not be a barrier if a commissioner believes his or her commitment is to the body and not to his or her own understanding of the law. On questions of law on which there is genuine and good faith disagreement, is it not better to surrender occasionally one's own views and adopt a compromise regulation than to have no regulation and leave the public in doubt?

The commission is not a judicial body, and commissioners should not conceive their role as that of a judge exercising independent judgment. The commission's rules are a collective judgment on the meaning and intent of the law and not an expression of each commissioner's preferred reading of the statute. A commissioner's own understanding of the law or the constitution should not be an insurmountable barrier to the commission's discharging its statutory responsibility.

No irreparable injury occurs when questions of doubt about a regulation's consistency with the statute are left to a court to resolve. The law may, in the mind of a commissioner, be poorly conceived, or even a possible affront to the constitution, but commissioners have a shared responsibility to act. 

Convincing oneself that one's reading of the law best reflects Congress' intent or relevant judicial opinions comes easily. What is hard is finding compromise that bridges sincere differences. Without that effort the commission will continue to fail in its duty to tell the public what the law is.



Karl J. Sandstrom is senior counsel at Perkins Coie LLP. He was an FEC commissioner from 1998 to 2002.

The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

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