The American Democracy Legal Fund has filed a complaint with the Federal Election Commission against Jon Keyser for violating the Federal Election Campaign Act of 1971.
Publicly available reports indicate that Mr. Keyser violated the Act and Commission regulations by soliciting $3 million dollars in soft money for his Senate campaign and coordinating with these outside groups on future spending.
The complaint is available below and in full here. The American Democracy Legal Fund holds candidates for office accountable for possible ethics and/or legal violations. It was established by David Brock and is run by Brad Woodhouse.
BEFORE THE
FEDERAL ELECTION COMMISSION
Brad Woodhouse
American Democracy Legal Fund
455 Massachusetts Avenue, NW
Washington, DC 20001
Complainant,
v.
Mr. Jon Keyser
P.O. Box 1168
Morrison, CO 80465
Respondent.
COMPLAINT
This complaint is filed under 52 U.S.C. § 30109(a)(1) against former State Rep. Jon Keyser for violating the Federal Election Campaign Act of 1971, as amended (the “Act”) and Federal Election Commission (the “Commission”) regulations, as described below. Publicly available reports indicate that Mr. Keyser violated the Act and Commission regulations by soliciting $3 million dollars in soft money for his Senate campaign and coordinating with these outside groups on future spending. We urge the Commission to investigate this apparent violation.
A. FACTS
Jon Keyser was a Republican legislator from Colorado and is seeking the Republican nomination for the 2016 U.S. Senate race. [1] National Republicans actively recruited Mr. Keyser to run against Democratic senator Michael Bennet.[1]
As part of the recruitment effort, National Republicans invited Mr. Keyser to Washington, D.C. and set up meetings to show him that they had donors and “folks on the soft money side who were ready to support him.”[2] Mr. Keyser attended the Republican Jewish Coalition’s presidential forum luncheon during the trip and “received $3 million in commitments of soft money to back his campaign at the event.”[3]
B. LEGAL DISCUSSION
Under the Act and Commission regulations, an individual is a candidate if he or she “has received contributions aggregating in excess of $5,000.”[4] The Act prohibits federal candidates from soliciting, receiving, directing, transferring, or spending “funds in connection with an election for Federal office, including funds for any federal election activity, unless the funds are subject to the limitations, prohibitions, and reporting requirements of this Act.”[5]
Funds accepted “solely for the purpose of determining whether an individual should become a candidate are not contributions.”[6] The testing-the-waters exemption is “explicitly limited ‘solely’ to activities designed to evaluate a potential candidacy.”[7] This exemption does not apply to an individual who “raises funds in excess of what could reasonably be expected to be used for exploratory activities or undertakes activities designed to amass campaign funds that would be spent after he or she becomes a candidate.”[8]
Federal candidates are barred from soliciting funds outside the source restrictions and amount limitations of the Federal Election Campaign Act (the “Act”) – also known as “soft money.”[9] This cycle, some Republican presidential candidates – most prominently, Jeb Bush – tried to evade the law by soliciting soft money funds prior to their formal announcements and claiming that they were exempt from the soft money solicitation ban during this “pre-candidacy” period. But in response to an advisory opinion request submitted earlier this year, the FEC’s Office of General Counsel (“OGC”) concluded that activity like this violated the law.[10] Individuals who solicited more than $5,000 in soft money to support their prospective campaigns had triggered candidacy, the OGC reasoned, and therefore they had to abide by the restrictions on soliciting soft money.
By undertaking this discredited approach, Mr. Keyser appears to have violated federal law. Public reports are clear that the $3 million in soft money that Mr. Keyser solicited were “to back his campaign.”[11] Mr. Keyser did not ask for those funds “to determine whether [he] should become a candidate”; rather, he did so to strengthen his position in the expected-to-be crowded Republican primary.[12] Thus, the money that he accepted at the luncheon is necessarily meant to “be spent after he . . . becomes a candidate” and were not exempt testing-the-waters funds.[13] Mr. Keyser became a candidate as soon as he solicited more than $5,000 in commitments to “back his campaign”; and because Mr. Keyser was a candidate, he was barred from soliciting soft money. Yet, according to news reports, that is precisely what he did.
Furthermore, if the outside groups follow through on their commitments and spend these soft money funds on public communications in support of Mr. Keyser that include the requisite content under 11 C.F.R. § 109.21(c), it will result in an illegal in-kind contribution. The news reports described above show that Mr. Keyser has either requested $3 million in soft money to be spent “to back his campaign” or that he assented to a suggestion by a third party to spend such funds. Either way, this conduct satisfies the “conduct prong” under 11 C.F.R. § 109.21(d). Accordingly, Mr. Keyser should be on notice that the spending of these funds in support of his campaign would result in an illegal in-kind contribution.
C. REQUESTED ACTION
As we have shown, Mr. Keyser violated the Act when he solicited soft money during his recent trip to Washington, D.C. We respectfully request that the Commission investigate this violation, and that Mr. Keyser be enjoined from further violations and be fined the maximum amount permitted by law.
Sincerely,
_______________________
SUBSCRIBED AND SWORN to before me this ____ day of January, 2016
_______________________________
Notary Public
My Commission Expires:
[1] Elena Schneider, NRSC Chasing New Colorado Senate Candidate, Politico Pro (Dec. 10, 2015, 3:15 PM), https://www.politicopro.com/campaigns/story/2015/12/republicans-recruiting-their-new-dream-colorado-senate-candidate-082754.
[2] Id.
[3] Ernest Luning, Keyser Poised to Jump into Senate Race, Colo. Statesman (Dec. 10, 2015), http://www.coloradostatesman.com/996385-keyser-poised-jump-senate-race/.
[4] 52 U.S.C. § 30101(2)(A); FEC, Advisory Opinion 1983-05, at 1–2 (Mar. 10, 1983) (“The threshold for candidate status is reached when an individual . . . receives contributions . . . that . . . aggregate in excess of $5,000.”).
[5] 52 U.S.C. § 30125(e)(1)(A); 11 C.F.R. § 300.61.
[6] 11 C.F.R. § 100.72(a).
[7] Payments Received for Testing the Waters Activities, 50 Fed. Reg. 9992, 9993 (Mar. 13, 1985).
[8] 11 C.F.R. § 100.7(b)(2).
[9] Id. § 30125(e)(1)(A).
[10] FEC Adv. Op. 2015-9 (Draft A).
[11] Luning, supra note 2.
[12] See Elena Scheinder, Republicans Recruiting Combat Veteran in Colorado Senate, Politico: Morning Score (Dec. 11, 2015, 10:00 AM) (noting that then-Rep. Keyser’s $3 million in soft money commitments “could come in handy in a crowded, highly unpredictable primary”), http://www.politico.com/tipsheets/morning-score/2015/12/republicans-recruiting-combat-veteran-in-colorado-senate-democrats-get-candidates-in-va-10-ca-25-211709.
[13] § 100.7(b)(2).