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ADIVISORY OPINION NO 2012-06 Summary of Request From: J. Randolph Evans and Benjamin J. Vinson of McKenna Long & Aldridge, LLP1) Given the nature of the regulatory framework set forth by the Act, Commission Rule 189-3-.06 and Commission Advisory Opinion 2007-07 with regard to the purchase of non-commercial air transportation services, what guidelines (if any) exist for a state campaign committee seeking to utilize its contribution funds to pay the costs associated with private air travel when such services are purchased in accordance with the terms of a fair-market, commercially-reasonable transaction? In other words, due to the fact that the Commission’s regulatory structure appears to address the payment of non-commercial air transportation service costs only in settings involving either an in-kind contribution of such services or the reimbursement of a party who provides such services free of charge, what guidelines (if any) exist for a state campaign committee seeking to purchase such services on the open market in accordance with the terms of a commercially-reasonable contract, lease, or other similar agreement? Also, in light of the current regulatory framework for the purchase of noncommercial air transportation services, does the provided analysis at all change if the private air travel is being purchased from an entity for which the candidate, candidate’s spouse, or candidate’s relative has an ownership interest (fractional or otherwise)? In such an ownership interest scenario, please assume that the state campaign committee is paying the entity at issue fair market rates for the non-commercial air transportation services provided. 2) When a state campaign committee utilizes its campaign funds to pay the costs associated with non-commercial air transportation services that are purchased in accordance with the terms of a fair-market, commercially-reasonable transaction rather than in settings involving either an in-kind contribution of such services or the reimbursement of a party who provides such services free of charge, what is the appropriate disclosure methodology for such expenditures on the committee’s periodic CCDRs filed with the Commission? In other words, given that the Act, Commission Rule 189-3-.06 and Commission Advisory Opinion 2007-07 only appear to provide a standard means of valuation and disclosure for noncommercial air transportation service expenditures made in situations where no actual market transaction took place and no true market value was set, how should a campaign committee that purchases such services on the open market through a commercially-reasonable contract, lease or other similar agreement report its private aircraft expenditures for the purposes of its CCDRs filed with the Commission?Posted: June 18, 2012

Posted By gaethics On June 18, 2012 @ 4:04 pm In Advisory Opinions | Comments Disabled

Summary of Request From: J. Randolph Evans and Benjamin J. Vinson of McKenna Long & Aldridge, LLP

1) Given the nature of the regulatory framework set forth by the Act, Commission Rule 189-3-.06 and Commission Advisory Opinion 2007-07 with regard to the purchase of non-commercial air transportation services, what guidelines (if any) exist for a state campaign committee seeking to utilize its contribution funds to pay the costs associated with private air travel when such services are purchased in accordance with the terms of a fair-market, commercially-reasonable transaction? In other words, due to the fact that the Commission’s regulatory structure appears to address the payment of non-commercial air transportation service costs only in settings involving either an in-kind contribution of such services or the reimbursement of a party who provides such services free of charge, what guidelines (if any) exist for a state campaign committee seeking to purchase such services on the open market in accordance with the terms of a commercially-reasonable contract, lease, or other similar agreement? Also, in light of the current regulatory framework for the purchase of noncommercial air transportation services, does the provided analysis at all change if the private air travel is being purchased from an entity for which the candidate, candidate’s spouse, or candidate’s relative has an ownership interest (fractional or otherwise)? In such an ownership interest scenario, please assume that the state campaign committee is paying the entity at issue fair market rates for the non-commercial air transportation services provided.

2) When a state campaign committee utilizes its campaign funds to pay the costs associated with non-commercial air transportation services that are purchased in accordance with the terms of a fair-market, commercially-reasonable transaction rather than in settings involving either an in-kind contribution of such services or the reimbursement of a party who provides such services free of charge, what is the appropriate disclosure methodology for such expenditures on the committee’s periodic CCDRs filed with the Commission? In other words, given that the Act, Commission Rule 189-3-.06 and Commission Advisory Opinion 2007-07 only appear to provide a standard means of valuation and disclosure for noncommercial air transportation service expenditures made in situations where no actual market transaction took place and no true market value was set, how should a campaign committee that purchases such services on the open market through a commercially-reasonable contract, lease or other similar agreement report its private aircraft expenditures for the purposes of its CCDRs filed with the Commission?

Posted: June 18, 2012


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