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The S T R A T E G I S T

January 2011

In This Issue
We Tweet!
About DB Capitol Strategies
One Week Left for Year-End Reports
FREE legal guidance!
How Hard Can It Be?
A Compliance Case Study
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01/21   Today is the 1st anniv. of Citizens United; has your PAC/advocacy program taken full advantage of new opportunities in the post-CU world?

 

01/20   Dale Carnegie noted that dogs are the most lovable of creatures, which, judging by how well meetings go once I chat about my puppy, is true.

 

01/19   Better Hill advocacy tip: mtgs on the hour and not every half hour. Less hectic pace is easier on advocates, tends to yield better advocacy

 

01/18   Great ideas from @AmyShowalter - "Advice to People Who Are Trying to Use Social Media for a Grassroots Network" http://ow.ly/1aU6e8

 

01/14   The problem w/daily comms strategy is actually communicating daily. We're none of us that clever, that consistently. Manage expectations.

 

01/13   at 4:23 on a Thursday, this is just GREAT (and yes, meaningful for all the PAC/advocacy/messaging folks too!) http://tpdsaa.tumblr.com/

13 JanFavoriteReplyDelete

 

01/13   RT @AmyShowalter: [New Blog Post] Grassroots and PAC Influence Lessons Learned in 2010 http://ow.ly/1aPV70

 

01/12   A lot of advocacy also happens by email; a little bit of digital courtesy can go a long way with your next "ask". Thank you is 9 characters

 

01/11   Today's bit of wisdom: a lot of advocacy happens in the Hill. When there, don't grab lunch at We The Pizza. Overpriced and not that good.

 

01/10   The sooner you address PAC compliance issues, especially in advance, the less it costs to fix later. Observing silence at 11 am. Sad days.

 

01/07   Tom Price, R-GA, agrees: telling advocates to ID their own pay-for is a cheap way for staff to say no. Don't accept the premise!

 

01/06   RT @ELB: "The State of Campaign Finance Policy: Recent Developments and Issues for Congress": The Congressional Rese... http://bit.ly/fW9fB3

 

01/05   PAC Compliance is NOT accounting; be wary of quirky FEC reporting regs that aren't intuitive & easily missed - consider a compliance audit.

 


DB Capitol Strategies and Dan Backer, Esq.

 

DB Capitol Strategies PLLC provides legal, strategic & operational guidance to political committees with a focus on PAC treasury and FEC reporting and compliance through its principle, Dan Backer.  Mr. Backer is a graduate of the University of Massachusetts Amherst and George Mason University School of Law.  In 2009, Mr. Backer earned the Professional Lobbying Certification (PLC) from the American League of Lobbyists.

 

Mr. Backer is admitted to practice law in Virginia & Washington DC, and before the U.S. District Courts for the Eastern & Western Districts of Virginia and Washington, DC.  Mr. Backer has extensive experience with public policy & advocacy programs, grassroots organizations, and Political Action Committees, and is Treasurer or Assistant Treasurer of several PACs.

 

You can reach Dan Backer at [email protected].

 

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Thank you for reading The StrategistThis information is not intended as legal advice, which turns on specific facts.  Seek specific legal advice before acting with regard to the subjects mentioned herein.  While our website is under construction, you can CLICK HERE to visit our online Archive of past editions. 

 

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One week left for year-end reports! 

The easiest mistake to avoid is filing late - get help now!

 

Late filing is the most commonly made and most easily avoided mistake a PAC can make - so don't!  Be sure to file your year-end report on time by January 31, 2011.  Having trouble reconciling your books, understanding how to properly report certain transactions, or still dealing with pre-/post-election reporting issues?  ASK FOR HELP NOW.  With a week to go, don't wait until it's too late.

 
Free legal/compliance advice from our FAQ!

 

DB Capitol Strategies is building an FAQ (Frequently Asked Questions) for PAC & political law compliance.  The easiest way to know what the most common questions are is to be asked them.

 

If you submit your own questions to our FAQ (see the link below), we will answer you directly (provided we can), and we may include your question or some version of it (anonymously) in our FAQ.

 

 How Hard can PAC compliance really be? 

After all, they let anyone do it, right?

 

Anyone can serve as the Treasurer of a political action committee.  The law requires no formal training, education, or understanding of FEC regulations or relevant election laws.  There is simply no bar to entry to those who chose to start a PAC, despite the complexity of the Treasurers role.   It is somewhat surprising that those who take on the responsibility of compliance often don't fully appreciate the personal or organizational risks or the complications of rapidly changing law.  There is no advance preparation on how to properly perform the compliance role of the PAC Treasurer.

The potential consequences are significant - damage to the PACs reputation, loss of donors and support, time-consuming and expensive audits and enforcement actions, large potential fines and even significant personal liability.  A compliance professional is critical to the long term health of a PAC; proper compliance is neither pure accounting nor pure law - It's a unique field unto itself.  If you don't invest in doing it right, you'll ultimately bear the potentially very significant cost if you do it wrong.

A case study in poor & proper compliance

 

A non-connected PAC, one of many formed in 2010, raised a significant amount of money in support of dozens of candidates nationwide.  It made a name for itself amongst a small and generous donor base and an ideologically-oriented candidate community.  The PAC made many good decisions from the outset - it recruited a strong Board of Directors and dedicated volunteer leadership.  It created a yearlong plan and successfully executed to achieve its goals.  It implemented a balanced fundraising strategy and established strict contribution parameters.  This all-volunteer, ideologically driven PAC had a team of smart, experienced business owners that ran the PAC like a business - something that far too few PACs do.  From the outset, the PAC understood generally that it had compliance obligations, and made the seemingly logical choice to have an attorney - a volunteer - serve as the Treasurer and handle the compliance duties.

Their attorney, successful and accomplished in his own practice, had no experience with PAC reporting.  Lacking expertise in the compliance role or familiarity with the intricacies of FEC regulations, reporting errors went unnoticed.  Mistakes ranged from accepting improper contributions and making the same; not making sufficient "best efforts" to obtain contributor information, not keeping records, not reporting transactions, reporting them in the wrong amounts or on the wrong lines, or double reporting them, and offering guidance that did not reflect the current state of the law.  None of this was intentional, malicious, or sinister.  The Treasurer simply didn't know because, while a consummate professional in his field, that field wasn't PAC compliance.

Compliance is an investment

In time, complexity wins out.  As PACs grow larger and develop more complicated activities and relationships, the compliance questions they face change as well.  A Treasurer, even an attorney, without some deeper experience in the field can't necessarily provide the guidance needed, particularly on the rapid changes in the law over the past year.  Volunteers are a particular challenge, as they have lives and careers wholly unrelated to, and of higher priority than, their volunteer activities.  Volunteers can very easily "check out" and lose interest when distracted, overwhelmed, or out of their depth.

Treasurers are also the point of contact for FEC inquiries, which may involve technicalities that inexperienced Treasurers are ill-equipped to address.  And once errors and problems mount, they easily snowball.  In a heartbeat, a PAC can go from failing to respond to an FEC Request For Additional Information (RFAI), to missing multiple reports.  And, as Volunteers, they often lack the professionalism and accountability of compliance professionals.

For one PAC, the tip of the iceberg revealed the depth of errors spanning a year.  It required the investment of an extraordinary amount of time, talent, and treasure from volunteers and professionals to rebuild an entire year of reports.  An investment far greater than that of proper compliance from the outset.  Tracking down contributor data, auditing and reconciling internal financials, and reviewing potentially problematic transactions all to reconstitute a years' worth of reports.  This can be a grueling, resource-intensive process that is de-motivating to the volunteers and leadership involved.  Even after the work is done, the potential still exists for significant fines and penalties from the FEC.

Caveats & final thoughts

Political Action Committees are businesses in their own right.  A smart business in a regulated field - like PACs, which operate under complex election laws - invests in proper compliance from the outset.  Doing the job right from the beginning always costs less than fixing what you've done wrong.  While hindsight is golden, and front-end investment is an expense, savvy PACs that get results make effective, knowledgeable, and professional compliance a priority.