W. Va. Code R. § 146-3-13

Current through Register Vol. XLI, No. 17, April 26, 2024

Section 146-3-13 - Joint Fundraising Agreements

13.1. Applicability.

13.1.1. The provisions of this Section, in addition to all applicable laws, shall govern all joint fundraising activity conducted under W. Va. Code § 3-8-9c.

13.2. Establishing separate committee; authority, requirements and prohibitions.

13.2.1. Registered political committees may engage in joint fundraising activities with other political committees registered in West Virginia or with the Federal Election Commission. Participants authorized to engage in joint fundraising activity shall only include political party committees, caucus campaign committees, candidate committees, and political action committees. Provided, that nothing in this Rule modifies the provisions of W. Va. Code §§ 3-8-8, 3-8-9a and 3-8-9b regarding the prohibition against corporate contributions and coordinated expenditures respectively, nor does this Section modify the prohibition against independent expenditure only political action committees making expenditures in concert or cooperation or at the request or suggestion of a candidate, his/her agencies, a candidate's committee, or a political party committee as set forth in Section 5.3.3.a. of this Rule.Provided, however, that committees which are permitted to receive otherwise prohibited contributions (e.g. certain Federal committees) may solicit and accept such contributions according to the provisions of this Rule and applicable state or Federal laws so long as the otherwise prohibited contributions are deposited into an account that is separate from the separate committee's account.

13.2.2. To lawfully engage in joint fundraising activities, the participants shall enter into a joint fundraising agreement and establish a separate committee, allocation formula and a joint fundraising representative.

13.2.3. The participants are permitted to hire a commercial fundraising firm or other agent to assist the joint fundraising representative with conducting joint fundraising activity. The commercial fundraising firm or other agent shall be answerable to the joint fundraising representative.Provided, this Subsection does not absolve the joint fundraising representative of any responsibilities or duties set forth in the law or this Rule.

13.2.4. Prior to soliciting or accepting any funds or engaging in any fundraising activities, the joint fundraising committee shall file a Statement of Organization with the Secretary of State, which shall include:

13.2.4.a. The name of the separate committee;

13.2.4.b. The date the joint fundraising agreement was executed;

13.2.4.c. The name, address, phone number and email address of the agent authorized to act as the joint fundraising representative on behalf of the separate committee;

13.2.4.d. The names and addresses of all committees participating in the joint fundraising agreement;

13.2.4.e. The name and address of the depository institution holding the joint fundraising committee's account;

13.2.4.f. Attach an original signed copy of the joint fundraising agreement; and

13.2.4.g. Any additional information deemed necessary by the Secretary of State.

13.3. Joint fundraising representative; separate committee activities.

13.3.1. The joint fundraising representative shall report the separate committee's activities in the same manner provided by law for a political committee.

13.3.2. The joint fundraising representative shall be responsible for managing all activities of the separate committee including but not limited to the following:

13.3.2.a. Record keeping, preparing and reporting all activities required by law and this Rule;

13.3.2.b. Collecting all contributions to the separate committee on behalf of the participants;

13.3.2.c. Paying for all costs incurred by the separate committee with gross proceeds from the separate committee's account and/or from funds contributed to the separate committee by participants; and

13.3.2.d. Distributing net proceeds to each participant according to the terms established under joint fundraising agreement.

13.3.3. The separate committee shall not be a participant in any other joint fundraising effort. Provided, that the separate committee may conduct more than one fundraising event for the participants consistent with the terms of the joint fundraising agreement.

13.3.4. Joint fundraising representatives shall be permitted to act as a joint fundraising representative for multiple separate committees. Provided, that all activities of each separate committee shall be kept separate.

13.4. Funding advancements by participants to joint fundraising committee.

13.4.1. Prior to a fundraising event, participants may advance funds to the joint fundraising committee for the costs of the fundraiser. Provided, that participants may contribute funds following a fundraising event only if the costs of the fundraiser exceed funds advanced and raised by participants.

13.4.2. The amount of funds advanced by each participant for fundraising costs shall be in proportion to the allocation formula agreed upon under the joint fundraising agreement. Provided, that the amount advanced may exceed any participant's proportionate share so long as the amount advanced does not exceed the amount that the participant may legally contribute to the remaining participants according to the contribution limits set forth in W. Va. Code § 3-8-5c.

13.4.3. Following the event, the joint fundraising representative shall pay fundraising costs from gross proceeds and from funds advanced by participants. After paying the specific fundraising event costs, the joint fundraising representative shall disburse net proceeds to each participant according to the allocation formula set forth in the joint fundraising agreement.

13.5. Joint fundraising; requirements; procedures; limitations.

13.5.1. The participants in joint fundraising activity shall enter into a written agreement and establish the following:

13.5.1.a. A separate committee through which all joint fundraising activity shall be conducted;

13.5.1.b. The name, address, phone number and email address of the agent authorized to act as the joint fundraising representative on behalf of the separate committee;

13.5.1.c. The names and addresses of all committees participating in joint fundraising activity under the joint fundraising agreement;

13.5.1.d. The allocation formula by which fundraising proceeds are disbursed to each participant;

13.5.1.e. The name and address of the depository institution holding the joint fundraising committee's account; and

13.5.1.f. Any additional information deemed necessary by the participants.

13.5.2. The allocation formula shall provide the exact amount or percentage to be allocated to each participant for all contributions and advancements received by the separate committee. The fundraising representative shall provide the written agreement to the Secretary of State prior to soliciting or accepting any funds, which agreement shall be made publicly available on the Secretary of State's campaign finance reporting system website.

13.5.3. A joint fundraising notice shall be included with each solicitation for contributions and fundraising event advertisement. The notice shall include the following information:

13.5.3.a. The names of all committees participating in the joint fundraising activity;

13.5.3.b. The allocation formula for distributing the joint fundraising proceeds;

13.5.3.c. A statement informing contributors that, notwithstanding the stated allocation formula, contributions may be designated for a particular participant or participants; and

13.5.3.d. A statement informing contributors that the allocation formula may change if a contributor makes a contribution which exceeds the maximum contribution amount to a participant than is permitted by law.

13.5.4. In the following special situations, the joint fundraising notice shall include the following additional information:

13.5.4.a. If one or more participants engage in joint fundraising activity solely to raise funds for outstanding debts, a statement informing contributors that the allocation formula may change if a participant receives sufficient funds to pay its outstanding debts; and

13.5.4.b. If one or more participants may not lawfully accept contributions from any particular source, a statement informing contributors that contributions from prohibited sources will be distributed only to those participants that may lawfully accept them.

13.6. Separate depository account; record keeping requirements.

13.6.1. The participants or joint fundraising representative shall establish a separate depository account to be used solely for the receipt and disbursement of joint fundraising proceeds. Only lawful contributions and advanced funds shall be deposited into the separate depository account.

13.6.2. Each separate committee shall disclose the name, location and account number of the separate depository account in the joint fundraising agreement.

13.6.3. The fundraising representative shall collect and forward to participants all contributor information required under W. Va. Code § 3-8-5a.

13.6.3.a. Participants shall make their contributor records available to the fundraising representative for screening purposes.

13.6.3.b. The fundraising representative and participants shall review and determine whether any contributions violate the provisions of W. Va. Code §§ 3-8-5c, 3-8-5g or 3-8-8.

13.6.3.c. The fundraising representative shall keep a record of the total amount of contributions received from prohibited sources, if any, and of all transfers of prohibited contributions to participants that may lawfully accept them.

13.6.3.d. For compliance purposes, the fundraising representative and all participants are individually responsible for following all applicable laws and this Rule.

13.6.4. If one or more participants may lawfully accept prohibited contributions (e.g. corporate contributions), the participants or joint fundraising representative may either establish a second depository account for contributions received from prohibited sources, or may forward such contributions directly to the appropriate participant(s) and shall keep clearly indicate the separate disbursements in the books of the separate committee.

13.6.5. The fundraising representative shall deposit all joint fundraising proceeds in the separate depository account. The fundraising representative may delay distribution of the fundraising proceeds to participants until all contributions are received and all expenses are paid.

13.6.5.a. The fundraising representative shall report contributions for the separate committee in the reporting period during which they are received.

13.6.5.b. For reporting purposes, the date of receipt of a contribution by the joint fundraising representative or separate committee shall be deemed the date that the contribution is actually received. For electronic transmission of a contribution, the date of completed transmission is the date of receipt.

13.6.5.c. Participants shall report joint fundraising proceeds in accordance with W. Va. Code § 3-8-5 in the reporting period in which they are received by the joint fundraising representative or separate committee regardless the funds have been distributed to participants. Provided, that if any contributor's information is not known by the close of the reporting period, the participant(s) shall report all available information and amend the appropriate report once all contributor information is known.

13.6.6. The joint fundraising representative shall retain all records required under W. Va. Code § 3-8-5 regarding fundraising disbursements for a period of two years. Commercial fundraising firms or agents shall provide such information to the fundraising representative.

13.7. Contribution limitations.

13.7.1. The maximum contribution that may be accepted by a separate committee or the joint fundraising representative on behalf of the separate committee shall not exceed the contribution limitations set forth in W. Va. Code § 3-8-5c for each participant in the aggregate less any contributions previously received by each respective participant from the specific contributor(s).

13.7.1.a. Contributions may be designated or earmarked for a specific participant or group of participants. In this case, the calculation of the maximum contribution limitation for that specific contribution shall only include the maximum lawful amount for the participant(s) to which the contributions are intended less any contributions previously received by any such participant(s) from the particular contributor(s).

13.7.1.b. For maximum contribution limitation calculation purposes, gross proceeds shall be considered for the calculation of the amount of funds received by each participant.

13.8. Allocation of gross proceeds.

13.8.1. The fundraising representative shall allocate proceeds according to the allocation formula stated in the joint fundraising agreement or otherwise in accordance with this Rule.

13.8.1.a. For a fundraiser to extinguish debt of the participants, if distribution according to the allocation formula extinguishes the debt of any participant and results in a surplus, the joint fundraising representative shall either reallocate the surplus funds to other participants that may lawfully accept the funds, or otherwise return the surplus funds to the contributor(s).

13.8.1.b. If distribution of funds under the allocation formula results in a violation of the contribution limits under W. Va. Code § 3-8-5c, the joint fundraising representative shall either reallocate the excess funds to other participants that may lawfully accept the funds, or otherwise return the surplus funds to the contributor(s).

13.8.1.c. Reallocation of surplus funds shall be based upon the remaining participants' proportionate shares under the allocation formula. If reallocation results in a violation of a contribution limit under W. Va. Code § 3-8-5c, the joint fundraising representative shall return to the contributor the amount of the contribution that exceeds the limit.

13.8.2. Notwithstanding Subdivision 13.8.1.c. of this Rule, any specifically designated or earmarked contributions which exceed the contribution limit or needed funds to retire the debt of the designated participant(s) shall not be reallocated by the joint fundraising representative without express written consent of the contributor(s).

13.9. Calculation of expenses and distribution of proceeds.

13.9.1. Payment of expenses shall be made by the joint fundraising representative from gross proceeds of each fundraising event.

13.9.1.a. The joint fundraising representative shall calculate each participant's share of expenses based on the allocation formula set forth in the joint fundraising agreement. Provided, that if any contributions are received from prohibited sources and distributed to participants that may lawfully accept such contributions, those funds shall not be included in gross proceeds for the purpose of allocating expenses under this Section. Provided, however, that such funds shall be recorded in the books of the separate committee.

13.9.1.b. The joint fundraising representative shall calculate each participants' share of the proceeds by subtracting fundraising expenses from gross proceeds and then distribute net proceeds to each participant based on the allocation formula set forth in the joint fundraising agreement.

13.9.2. A participant shall be permitted to cover fundraising expenses on behalf of another participant. Provided, that covering such expenses shall be subject to the contribution limits under W. Va. Code §§ 3-8-5c and 3-8-9b, as well as being subject to the prohibitions against certain activities by candidate committees and political action committees under W. Va. Code § 3-8-9.

13.9.3. The expenses from a series of fundraising events or activities shall be allocated among the participants under the allocation formula set forth in the joint fundraising agreement on a per-event basis. Provided, that if more than one event occurs on a single date, such events shall be considered separate events for reporting and allocation purposes.

13.10. Reporting receipts and disbursements.

13.10.1. The fundraising representative and all participants shall report all funds received during the reporting period in which they are received as contributions from each individual contributor pursuant to W. Va. Code §§ 3-8-5a and 3-8-5b, as well as Subsection 13.6.5. of this Rule.

13.10.2. The fundraising representative shall submit a statement detailing the total amount of contributions received from prohibited sources during the reporting period, if any, by submitting an addendum to the campaign finance report to the Secretary of State's Elections Division via email, U.S. mail, facsimile or hand delivery.

13.10.3. For cash balance purposes, each participant shall report net proceeds received as contributions and shall report the portion of contributions allocated to fundraising expenses as in-kind contributions. The amount of each contribution and in-kind contribution shall be calculated based on the allocation formula set forth in the joint fundraising agreement and itemized in the report by each original contributor. Provided, that the sum of the contribution and in-kind contribution from each donor, which should equal each participant's share under the allocation formula of the gross proceeds, shall not exceed the contribution limitations of W. Va. Code § 3-8-5c.

W. Va. Code R. § 146-3-13