Advisory Opinion 053

Opinion number: 
Date Adopted: 
Friday, December 17, 1982
Campaign Finance
Requested by: 
Leon McCoy, Treasurer DeCamp for Public Office Committee
Where candidates or their committees utilize non-profit mailing privileges from either the State Democratic or Republican Party, that Party must report the extent of that use (the difference between the standard vs. non-profit mailing rate) as an in-kind contribution.

REQUESTED BY: Leon McCoy, Treasurer DeCamp for Public Office Committee 401 Main Street, Neligh, NE 68756


Dear Mr. McCoy:

On October 19, 1982, the Executive Director of the Nebraska Accountability and Disclosure Commission wrote to the chairperson and director of the state Democratic and Republican political party committees advising them that if they permitted candidates to use the party committees' non-profit bulk mailing privileges, the political party committees would have to report the difference between standard bulk postal rates and the non-profit rate as an in-kind contribution (expenditure) to the candidates and that the candidates should be advised that they must report receipt of in-kind contributions reflecting that difference.

The Republican Party Committee reported the amounts reflecting such difference to your candidate committee for it to report to the Commission by amending a Campaign Statement already filed and to be included in the next Campaign Statement to be filed.

On October 21, 1982, you wrote to the Nebraska Accountability and Disclosure Commission stating that you disagree with the position of the Executive Director and want an official ruling from the Nebraska Accountability and Disclosure Commission before including such amounts in any reports.

On October 22, 1982, the Executive Director wrote back to you saying that your letter would be treated as a request for an advisory opinion by the Commission.

It is important to distinguish the situation in question from those situations where the political party committee pays for the printing and mailing of political advertisements for the benefit of a candidate without any payment by the candidate committee. This type of a situation is a simple in-kind contribution or independent expenditure to be reported at cost, namely the non-profit bulk mailing rate. Section 454.41, Postal Operations Manual.

The following statutes are involved when the candidate pays for the non-profit bulk mailing:

Section 49-1457(1), which requires that a Campaign Statement of a political party committee shall contain "(b) An itemized list of all expenditures, including in-kind contributions and expenditures . . ., made during the period covered by the campaign statement which were contributions to a candidate committee of a candidate for elective office . . ."

Section 49-1455(2), which requires a candidate committee to report "In-kind contributions or expenditures at fair market value as both contributions and expenditures. . ."

Section 49-1430 defines an in-kind contribution or expenditure as a contribution or expenditure otherwise defined, other than money, as distinguished from an independent expenditure defined in Section 49-1429 as an expenditure not made at the direction of, or under the control of, another person and if the expenditure is not a contribution to a committee.

Contributions and expenditures are defined in Section 49-1415 and Section 49-1419. Basically, contributions and expenditures constitute anything of ascertainable monetary value given or made for the purpose of influencing the nomination or election of a candidate.

Under the statutes cited, an in-kind contribution is an item purchased or a thing of value given to, or provided for the benefit of, a candidate other than money being contributed thereto.

In this case, by permitting a candidate or his committee to use the non-profit bulk mailing rate privilege accorded to a political party committee, a thing of ascertainable monetary value is, in effect, given to the candidate and his committee by the party committee. The candidate is supposed to mail at his own expense and at standard bulk rates as distinguished from non-profit bulk rates. See Section 454.23 and 454.5, Postal Operations Manual. In order to mail at non-profit bulk rates, the item mailed must contain an identification of the authorized permit holder. Section 623.6, Domestic Mail Manual. In order to comply with this requirement, it is our understanding that the campaign material in question contained the statement that it was "Paid for by Nebraska Republican State Central Committee," even though its printing and mailing were actually paid for by the candidate committee. The party committee paid no part of the printing or the mailing other than permitting its non-profit mail permit to be so used. (Section 49-1474.01 requires the name of the person or committee "at whose instance or request such . . . circular . . . is so printed, published or reproduced "to be printed thereon.)

As to the reporting of the difference in value between the standard bulk mailing rate and the non-profit mailing rate by both the party committee and the candidate committee as an in-kind contribution (and/or expenditure), Federal Election Commission Rule, 11 CFR 100.07(a) (1) (iii) (A), provides that the term "anything of value" includes all in-kind contributions, and that "If goods or services are provided at less than the usual and normal charge, the amount of the in-kind contribution is the difference between the usual and the normal charge for the goods or services at the time of the contribution and the amount charged the political committee." See also 11 CFR 100.08 (a) (1) (iv) (A).

There are a series of Federal Election Commission advisory opinions which view a discount below the "usual and normal charge" to be an in-kind contribution, and where goods or services are provided at a charge which is less than the usual and normal charge, the provider thereof is deemed to have made an in-kind contribution in the amount of the difference between the usual and normal charge for those goods and services at the time of the contribution and the amount charged. See Federal Election Commission advisory opinions AO 1978-45; Informational Letter re AOR 1976-30, Paragraph 6002, CCH, Federal Election Campaign Guide; AO 1982-4; AO 1982-8; AO 1977-45.

Therefore, in view of the rationale of the foregoing advisory opinions and the postal regulations to the effect that a candidate is not entitled to mail at the non-profit bulk rate, it is our position that the difference in cost by reason of permitting the use of the party committee's permit at a rate less than what the candidate would have paid for a similar mailing had he done so on his own bulk-rate permit should be deemed to be an in-kind contribution and reportable on the Campaign Statements of both the political party committee and the candidate.