MUR750600041
FEDERAL ELECTION COMMISSION Washington, DC 20463
May 24, 2021
Sean Patrick Maloney
Cold Spring, NY 10516
RE: MUR 7506 Maloney for New York
Dear Mr. Maloney:
On October 5, 2018, the Federal Election Commission notified your state campaign committee, Maloney for New York, of a complaint alleging violations of certain sections of the Federal Election Campaign Act of 1971, as amended. On April 20, 2021, the Commission found, on the basis of the information in the complaint, that there is no reason to believe that Maloney for New York violated 52 U.S.C. §§ 30102, 30103, and 30104 by failing to organize, register, and report as a political committee. The Commission also dismissed the allegation that Maloney for New York violated 52 U.S.C. § 30104(f) by failing to report electioneering communications. Accordingly, the Commission closed its file in this matter.
Documents related to the case will be placed on the public record within 30 days. See Disclosure of Certain Documents in Enforcement and Other Matters, 81 Fed. Reg. 50,702 (Aug. 2, 2016). The Factual and Legal Analysis, which explains the Commission's findings, is enclosed for your information.
If you have any questions, please contact Justine A. di Giovanni, the attorney assigned to this matter, at (202) 694-1574 or [email protected],
Sincerely,
Jin Lee Acting Assistant General Counsel
Enclosures: Factual and Legal Analysis MUR750600042
1 FEDERAL ELECTION COMMISSION
2 FACTUAL AND LEGAL ANALYSIS
3 4 RESPONDENTS: Sean Patrick Maloney for Congress and Holly Giarraputo MUR: 7506 5 in her official capacity as treasurer 6 Maloney for New York
7 I. INTRODUCTION
8 This matter was generated by a complaint filed with the Federal Election Commission
9 (the “Commission”) by Anthony G. Scannapieco, Jr., Chairman of the Putnam County
10 Republican Party.1 In 2018, Sean Patrick Maloney was a candidate running for both the United
11 States House of Representatives and New York State Attorney General. The Complaint alleges
12 that Maloney’s New York state campaign committee, Maloney for New York (“State
13 Committee”), received $1.45 million in transfers from Maloney’s congressional political
14 committee, Sean Patrick Maloney for Congress (“Federal Committee;” collectively with the
15 State Committee, “Committees”). The Complaint alleges that the State Committee received
16 $26,000 in corporate contributions, and $710,300 from 60 individuals who had also contributed
17 the maximum amount to the Federal Committee.
18 Separately, the Complaint contends that television advertising for which the State
19 Committee disclosed expenditures in the amounts of $166,695 and $501,840 constituted
20 electioneering communications in support of Maloney’s federal candidacy. The Complaint
21 further alleges that money paid to air the advertisements by the State Committee subjected the
22 State Committee to federal regulation as a political committee.
1 See 52 U.S.C. § 30109(a)(1). MUR750600043
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1 As set forth below, the Commission finds no reason to believe that the Committees
2 improperly transferred funds from the Federal Committee to the State Committee in violation of
3 52 U.S.C. § 30125(e)(1)(B); dismisses the allegations that the State Committee failed to report
4 electioneering communications in violation of 52 U.S.C. § 30104(f); and finds no reason to
5 believe that the State Committee failed to organize, register, and report as a political committee
6 in violation of 52 U.S.C. §§ 30102, 30103, and 30104.
7 II. FACTUAL BACKGROUND
8 Sean Patrick Maloney was first elected as the Representative of New York’s 18th
9 Congressional District in the U.S. House of Representatives in 2012.2 During the 2018 election
10 cycle, Maloney ran for reelection to the House, filing his Statement of Candidacy on February 9,
11 2017.3 In addition, on June 6, 2018, Maloney also ran to become New York’s Attorney
12 General.4 Between August 10 and September 13, 2018, the Federal Committee transferred
13 $2,446,744.37 to the State Committee.5
14 According to the Complaint, between September 8 and September 13, 2018, the State
15 Committee spent a total of $668,535 to air cable and broadcast television advertisements in
16 support of Maloney in the Hudson Valley and the New York metropolitan area, which covered
2 Biography, REPRESENTATIVE SEAN PATRICK MALONEY, https://seanmaloney.house.gov/about/biography (last visited July 10, 2019).
3 FEC Form 2, Sean Patrick Maloney Statement of Candidacy (Feb. 9, 2017).
4 Compl. at 1 (Sept. 24, 2018); Resp. at 1 (Jan. 8, 2019); see also Shame Goldmacher, Sean Patrick Maloney Jumps into New York Attorney General’s Race, N.Y. TIMES (June 6, 2018), https://www.nytimes.com/2018/06/06/ nyregion/maloney-attorney-general-election-primary-democrat.html; D’Angelo v. Maloney, 84 N.Y.S. 3d 276 (N.Y. App. Div. 2018) (permitting Maloney to engage in both campaigns simultaneously).
5 FEC Form 3, Federal Committee Second Amended 2018 October Quarterly Report 70-72 (Jan. 17, 2019). MUR750600044
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1 New York’s 18th Congressional District.6 Neither the Complaint nor the Response identify the
2 advertisements at issue.
3 On September 13, 2018, Maloney lost the Democratic primary for New York Attorney
4 General.7 Maloney’s federal campaign continued,8 and he was re-elected to the House in
5 November 2018.9
6 III. LEGAL ANALYSIS
7 A. Transfers by the Federal Committee to the State Committee 8 Were Permissible
9 Under the Federal Election Campaign Act of 1971, as amended, (the “Act”), a federal
10 candidate or officeholder, agents thereof, or an entity directly or indirectly established, financed,
11 maintained, or controlled by or acting on behalf of one or more candidates or federal
12 officeholders may not solicit, receive, direct, transfer, or spend non-federal funds in connection
13 with a state election.10 The Act, however, provides a limited exception to this restriction for a
14 federal candidate or officeholder who is or was also a candidate for a state or local office, so long
15 as the solicitation, receipt, or spending of funds: (1) is “solely in connection with such election
16 for State or local office;” (2) “refers only” to him or her, to other candidates for that same state or
17 local office, or both; and (3) is permitted under state law.11 Further, the Act permits candidates
6 Compl. at 2.
7 Id. at 1.
8 Id.
9 Lisa W. Foderaro, He Wanted to Go to Albany. He’ll Settle for Washington., N.Y. TIMES, Sept. 23, 2018, https://www.nytimes.com/2018/09/23/nyregion/sean-patrick-maloney-congress-house-election-odonnell.html.
10 52 U.S.C. § 30125(e)(1)(B).
11 See id. § 30125(e)(2); see also 11 C.F.R. § 300.63; Advisory Op. 2016-25 (Mike Pence for Indiana) at 2. MUR750600045
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1 to use campaign funds for a wide variety of enumerated purposes, including “for donations to
2 State and local candidates subject to the provisions of State law,” or “any other lawful purpose”
3 that does not constitute conversion of campaign funds to “personal use.”12
4 Here, because Maloney was running for both federal and state offices, the transfer of
5 funds from the Federal Committee to the State Committee appears to be a permissible use of
6 campaign funds and does not appear to violate New York law, which allows such transfers
7 between the authorized committees of the same candidate.13 In addition, the Complaint does not
8 allege and the Commission has seen no indication that the transferred funds were used for any
9 purpose other than to support Maloney’s state campaign. Accordingly, the Commission finds no
10 reason to believe that the Committees violated 52 U.S.C. § 30125(e)(1)(B).
11 B. The Commission Dismisses the Allegation that the State Committee Failed to 12 Report Electioneering Communications
13 The Act and Commission regulations define an electioneering communication as “any
14 broadcast, cable, or satellite communication that: (1) Refers to a clearly identified candidate for
15 Federal office; (2) Is publicly distributed within 60 days before a general election for the office
16 sought by the candidate . . . ; and (3) Is targeted to the relevant electorate, in the case of a
12 See 52 U.S.C. § 30114(a), (b); see also 11 C.F.R. §§ 113.1, 113.2; Advisory Op. 2018-15 (Wyden) at 3; Advisory Op. 2018-06 (Liuba for Congress) at 2.
13 Under New York election law, campaign contributions are subject to limits established and annually adjusted by the state legislature. N.Y. Elec. Law § 14-114; N.Y. Comp. Codes R. & Regs. Tit. 9, § 6214.0. “Contributions” include “any funds received by a political committee from another political committee to the extent such funds do not constitute a transfer.” N.Y. Elec. Law § 14-100(9)(2). A “transfer” includes “any exchange of funds or anything of value between political committees authorized by the same candidate and taking part solely in his campaign.” Id. § 14-100(10). Transfers are not included in the contribution limit provided under § 14-114 of the New York Election Law. Cf. Advisory Op. 1993-10 (Colorado) (permitting a former federal candidate to transfer excess campaign funds to his campaigns for President of the Popular Democratic Party and for Governor of Puerto Rico); Advisory Op. 2000-32 (Martinez) (permitting donation of federal funds to a state candidate); Advisory Op. 1996-52 (Andrews) (treating refund to and re-solicitation of federal campaign contributors on behalf of campaign for state office as permissible transfer of funds by federal candidate to his campaign for state office). MUR750600046
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1 candidate for . . . the House of Representatives.”14 Persons who make electioneering
2 communications in an aggregate amount greater than $10,000 must file reports with the
3 Commission including the identification of the person making the electioneering communication,
4 the amount of each disbursement of greater than $200, the elections and candidates to which the
5 communication pertains, and other relevant information.15 Further, a state candidate may not pay
6 for public communications that promote, support, attack, or oppose a federal candidate with non-
7 federal funds.16 Under 52 U.S.C. § 30125(e)(2), dual candidates are permitted to raise and spend
8 non-federal funds solely in connection with their state candidacy.
9 The Complaint alleges that a number of cable and broadcast television ads aired by the
10 State Committee in support of Maloney’s race for New York Attorney General constitute
11 electioneering communications under 11 C.F.R. § 100.29. The Response contends that the ads
12 are not electioneering communications because under 11 C.F.R. § 100.29(c)(5),17 a
13 communication is exempt from the definition of electioneering communications if the
14 communication is “paid for by a candidate for State or local office in connection with an election
15 to State or local office, provided that the communication does not promote, support, attack or
16 oppose any Federal candidate.”18
17 Here, neither the Complaint nor the Response has pointed to the specific ads that were
18 aired by the State Committee in support of Maloney’s candidacy for New York Attorney
14 11 C.F.R. § 100.29(a); see also 52 U.S.C. § 30104(f)(3).
15 52 U.S.C. § 30104(f)(1)-(2).
16 Id. § 30125(f)(1).
17 Resp. at 1-2.
18 11 C.F.R § 100.29(c)(5). MUR750600047
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1 General, and therefore on the record presented, the Commission lacks sufficient factual basis to
2 find reason to believe the Committees violated 52 U.S.C. §§ 30104(f) and 30125(f) and
3 dismisses the allegation.
4 C. There is No Reason to Believe that the State Committee Is a Political 5 Committee under the Act
6 The Act defines a “political committee” as “any committee, club, association, or other
7 group of persons which receives contributions aggregating in excess of $1,000 during a calendar
8 year or which makes expenditures aggregating in excess of $1,000 during a calendar year.”19 A
9 contribution includes “any gift, subscription, loan, advance, or deposit of money or anything of
10 value made by any person for the purpose of influencing any election for Federal office,”20 and
11 an expenditure includes “any purchase, payment, distribution, loan, advance, deposit, or gift of
12 money or anything of value, made by any person for the purpose of influencing any election for
13 Federal office.”21 In Buckley v. Valeo, the Supreme Court concluded that the term “political
14 committee” “need only encompass organizations that are under the control of a candidate or the
15 major purpose of which is the nomination or election of a candidate.”22
16 The Complaint has not alleged any facts indicating that the State Committee crossed the
17 statutory threshold for becoming a political committee under the Act. The funds that the State
18 Committee received from the Federal Committee are not contributions because the funds were
19 not transferred for the purpose of influencing a federal election, but for Maloney’s candidacy for
20 New York Attorney General. Accordingly, the Commission finds no reason to believe that the
19 52 U.S.C. § 30101(4)(A).
20 Id. § 30101(8)(A)(1) (emphasis added).
21 Id. § 30101(9)(A)(1) (emphasis added).
22 424 U.S. 1, 79 (1976). MUR750600048
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1 State Committee violated 52 U.S.C. §§ 30102, 30103, and 30104 by failing to organize, register
2 and report as a political committee.