But it is the basic law we now operate under that is vague and hard to comply with. But the new statute is infinitely more complicated and subject to infinitely more interpretation.

Mr. CURTIS. If I could again express the same philosophy-and I think it is shared by the Commission-we view our role to try to get more people participating in politics, not less. To do that you have got to make it clear so that people can carry it out, just as you say, without fear of violation; but it has the added feature that enables us to be able to crack down where there is a deliberate attempt to circumvent the statute.

Mr. TIERNAN. We have had representatives from the Justice Department before the Commission, and at that meeting they indicated the number of cases left from all of those referrals to the Justice Department by all of the supervisory officials is less than 200 cases now. To my surprise they do not notify a candidate that they were not going to proceed to prosecute the apparent violation. The burden is on you as candidate or incumbent to write and ask what has happened, and they will write back and say that case has been closed. The important thing is of all of those referred, by recent report. there were less than 200 cases outstanding.

Mr. ARMSTRONG. I don't want to dwell on that. There is one other aspect of this I would like to discuss briefly and see if I can clarify the situation.

The enforcement of this disturbs me as much as the interpretation. I am under the impression even though the Commission may be satisfied that a candidate is in compliance, if someone else, some citizen or some law enforcement authority is not, that the candidate may nonetheless be subject to prosecution. It is easy to imagine a situation in which a candidate would seek the advice of the Commission, comply with the advice he received, and nonetheless find himself hauled into court perhaps by his opponent who would seek to disqualify him from holding office under the terms of this act even though he was fully in compliance with the regulatory authority.

Mr. CURTIS. I think it is possible, but I would observe he sure would have a lot of support in the fact that he had complied with the Commission's directions. The Commission staff will have the reputation. I hope, which can only be gained by its performance, that this would be pretty compeiling evidence to obviate this.

Mr. ARMSTRONG. But under the statute as it is written I am not aware that the Commission has any fact finding power other than just that of any expert witness, let's say. It is not comparable, for example. to a regulatory proceeding where the court is bound by the Commission's finding of fact.

Mr. CURTIS. That is true, but we do audit and so forth. So it does tie it down.

Mr. ARMSTRONG. Mr. Chairman, I have no further questions. I appreciate this opportunity to discuss the problem, and frankly I am gratified by the responses of the Chairman of the Commission because they are concerned about these issues and hopefully will be able to work them out in the next several months.

Thank you, Mr. Chairman.

[Discussion off the record.]

Mr. STEED. The committee will recess until 10 a.m. tomorrow.

WEDNESDAY, MAY 14, 1975.

FEDERAL ELECTION COMMISSION

WITNESSES

THOMAS B. CURTIS, CHAIRMAN

NEIL STAEBLER, VICE CHAIRMAN

ROBERT TIERNAN, COMMISSIONER

GORDON ANDREW MCKAY, ASSISTANT STAFF DIRECTOR
BILL LOUGHREY,

THOMSON

EXECUTIVE

ASSISTANT TO COMMISSIONER

Mr. STEED. The committee will be in order.

The committee is in session today for further consideration of the 1976 budget request for the Federal Election Commission. We are pleased to have Chairman Curtis and his colleagues back with us. Mr. CURTIS. Mr. Chairman, I have with me Vice Chairman Staebler this morning and Commissioner Tiernan. Mr. Murphy, our General Counsel, has just been aboard about a week, and he told us when he reported for duty, the day after he was selected, that as a professor at Georgetown he had some obligations to fulfill there at sometime and he is in the business now of completing those. He regrets not being here this morning. Mr. Potter had some other important Commission business today and also wants to express his regret at not being here. I do have with me Mr. McKay, our Assitant Staff Director, and Bill Loughrey, Executive Assistant to Commissioner Thomson.

COMMISSION STAFF

Mr. STEED. First, could you give us a summary of the work force that you anticipate at this stage? I know you have had the advantage of the other activities both at the House and Senate and GAO. I am assuming this gave you some lead on determining what type of work this sort of law generates. Could you give us your thinking on staffing at this point?

Mr. CURTIS. I will be pleased to, Mr. Chairman. Ultimately, as we project in the budget, we will build up to probably about 140 places. Beginning on page 5 and running through about page 9, we put asterisks in front of the functions that will be new, that aren't under the law, and thus made clear what the functions we are taking over. That will give some indication.

Mr. STEED. We have put this material in the record.

Mr. CURTIS. That is right. So it would be referred to there.

We have in preparing this request worked very closely with the Secretary of the Senate and the Clerk of the House of find out what they were doing, also with the GAO and the Justice Department.

We gave you yesterday an estimate of what the costs were in the areas that we were absorbing. That was our estimate, and we pointed but it was an estimate because although we had some actual figures of what the Clerk of the House spent, what the Secretary of the Senate pent and what GAO spent, because of bookkeeping and so forth there were many, many items that were not included.

I think Mr. Armstrong asked for our working papers on it and we did send them to him yesterday afternoon.

EXISTING SUPERVISORY AUTHORITY COST ESTIMATES

When we appeared yesterday before the House Administration Committee, their staff, interestingly enough, had prepared estimates of the total cost to Secretary of the Senate, the Clerk of the House and GAO. They came up with a figure of $3.7 million which is right within the ball park of our estimate of $4 million. So I think we can be fairly well assured we are talking about the same thing.

I have one other item our staff prepared. Bill Loughrey, who formerly worked with Congressman Frenzel, prepared a budget of the three supervisory offices for the 1976 election, assuming this Commission hadn't been established. I think I might leave this hypotheti cal budget with the committee because the estimates there were that the total budget of the three supervisories plus startup cost would be $6 million just for existing function and without including the new functions of this Commission, such as public financing of Presidential elections, such as now having to police the limitation on contributions and expenditures, and a number of things like that. For just carrying on their present function, because of cost of living and other things and because of the Presidential election as opposed to just a congressional election, these costs would be that much. The committee might want that to refer to so I brought it along.

FIELD WORK AND INVESTIGATIONS

Mr. STEED. A lot of your work is going to be outside Washington since elections are held throughout the country. What do you visualize will be your need and volume of field work in terms of investigators! Or even in the field of perhaps setting up some meetings of an educational type at the beginning of campaigns and that sort of thing! Have you made any determination yet about what your field force would have to be?

Mr. CURTIS. Yes. First we made a judgment that may be in error. namely that we wouldn't have to set up permanent field offices. We know under the law we are going to have to conduct some field audits and investigations, but we thought we could centralize it and also we thought we could do some borrowing of personnel. But if we are wrong and it proves we have to set up field organizations, we might be back to this committee because there would be added costs.

The investigations begin on page 44 giving a functional statement, then special field investigations, routine field audits, and finally the Presidential certification is where we get into a new function. There we have to be sure that the Federal money from the income tax dollar checkoff is spent accurately. This is brand new; we have the responsi bility to be sure that these moneys are spent in accordance with the law so there is a great deal more auditing involved here in the Presi dential campaigns.

On page 47 it shows the breakdown of what we are going to need for investigations. Correct me if I am wrong, Mr. McKay and Mr. Loughrey. We have drawn heavily here on the GAO, what they actually used

and what Justice actually used in coming up with our request for a director, GS-16; 2 assistant field directors; 3 senior field Investigators; 2 investigators GS-12; 2 GS-11; 2 at GS-9 and 2 secretaries, a total of 12 permanent personnel. We think we have enough to do the job. Again we could be erring by not asking enough just as much as we could the other way because this is somewhat new.

We are trying to do our best to work with this committee as we move forward rather than come in with something that is rigid and not subject to change.

VOLUNTARY COMPLIANCE

Mr. STEED. My personal opinion is that since the law is not as inclusive in some ways as it should be and doesn't say some things perhaps it should in others, we probably could minimize a lot of this in the beginning if the Commission is able to develop the type of regulations that will forestall what I would say are honest mistakes that a wide variety of people seeking office could make. That is why we are emphasizing this aspect.

Mr. CURTIS. I didn't respond to that. You had two questions and the second one was this business of going out and informing the people. In the law is a provision that we shall try to bring about voluntary ompliance. Yesterday Congresswoman Boggs said: "If you really achieve that you hope you can achieve through voluntary compliance, won't that really cut down your budget needs on the investigation and the criminal enforcement?"

I said, "You couldn't be more right."

Hopefully we can do that, Mr. Chairman. That is where the travel omes in on page 59, travel and transportation of persons along with what we call our information section, which is really information and publications. This is the main thrust toward the voluntary compliance spect.

Yes; we certainly do feel that if we get the word out the American people want to abide by the law if it is fair and they know what it is. What we are trying to do is encourage more people to be active politically, not less, and the one way to do it is to make these regulaons clear and certain, letting everyone know we are not going to hrow the book at them for minor violations. Quite the contrary. We ave personnel contemplated in here that will help people fill out forms, work with them over the phone if necessary. Drawing on the xperience of the Clerk of the House, Mr. McKay could testify to how ich they would engage in trying to help people fill out the forms orrectly and then notifying them if they weren't correct. The same ay with Mr. Potter's operation in the Senate. By the Commission king on these two experienced people in the area I think we have rained several months and great experience in doing a better job. Mr. FLYNT. Could you and maybe Mr. McKay give us some examples of what you consider major versus minor violations.

WORK OF CLERK OF HOUSE AND SECRETARY OF SENATE

Before you respond Mr. McKay and Mr. Chairman, let me say his: I think in your transition period and as you move forward into

phasing out the operations of the Clerk of the House and Secretary of the Senate I want to commend you for your and the entire Commission's good judgment in selecting Mr. McKay and Mr. Potter. I have watched Mr. McKay's operations. Of course, I have had an opportunity to much more closely than Mr. Potter's. I think they are totally dedicated, highly motivated, conscientious and very able men in this field. I want to commend you and the Commission for selecting them to aid you in the transition stage.

Mr. CURTIS. Thank you, sir, we welcome that kind of praise.

Let me say, as I said before, because I think it needs to be publicly known, as one who was in Washington who knew about this setup I myself in reading the news media have been critical. I said this is the goats watching the cabbage patch.

One of the most gratifying experiences I have had in the last few months is to actually see what the Clerk of the House and the Secretary of the Senate had done in order to fulfill their responsibilities under the 1971 law, and the public ought to know what a splendid job in my judgment and of the Commission had been done. This is what enabled us to make these selections feeling we could answer any critics. The critics have been on the side of saying this is just the Congress sort of taking over and putting it in a Commission that will really be dominated by Congress. This is not the case. The reputation that Mr. Potter and Mr. McKay have rightly earned of being totally nonpartisan. being the true umpire, I think needs to be on the record.

MAJOR VERSUS MINOR VIOLATIONS

Would you help us, Mr. McKay, and tell us some of the examples the Congressman has requested.

Mr. McKAY. I think a difference might be clearly in terms of disclosure: If in a report someone makes an innocent mistake on a date or failing to sign a report, or in adding or subtracting figures, or in someother way doesn't understand what the form requires, such would be minor: versus the willful failure to disclose illegal contributions from corporations or unions, such would be a major violation.

Minor problems often can be resolved by spreading information on how to file, how to fill out the forms.

COMMISSION INFORMATION

The Commission suggested one way to spread information is through a regular newsletter to candidates, treasurers of committees. and other interested persons to keep them fully abreast of the latest regulations and other general information. Through such a newsletter, the Commission hopes to enhance the knowledge of the person filling out the forms and make their job easier.

There is one other suggestion the Commission is moving forward on. An "800" telephone number is being installed so anybody in the country can call in toll free and get someone at the Commission to and help them fill out forms or answer any questions which they may have. Wheretofore someone in Oregon or California has had to bear the expense of communicating directly to Washington, D.C.