005 Notification to Crabtree

7/27/2019 005 Notification to Crabtree

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FEDERAL ELECTION COMMISSIONWASHINGTON, D.C. 20463

David C . Thompson, EsquireDavid C. Thompson, P.C. JUN 1.9 2013321 Kittson AvenueP.O. Box 5235Grand Forks, North Dakota 58201Re: M U R 6663

Dear M r. Thompson:On October 12,2012, the Federal Election Commission notified your clients Brad

Crabtree, Crabtree for .PSC, and Perry Miller in his official capacity as treasurer of a complaintalleging violations of the Federal Election Campaign A ct p$ 197.1, as amended, (the "Act") . OnJune 11, 2013, the Commission found, on the basis of the informatibn in the complaint, andinformation provided by your clients, that there is no reason to believe Brad Crabtree,. Crabtreefo r PSC,'and Perry Mil le r in his official capacity as treasurer violated'2 UVS.C. 434(f).Accordingly, the Commission closed.its file in this hiatter.Documents related to the case wil l be placed on the public record within 30 days. SeeStatement of Policy Regarding Disclosure of Closed Enforcement and Related Files,68 Fed. Reg, 70,426 (Dec, 18, 2003) and Statement of Policy Regarding Placing First GeneralCounsel's Reports on die Public Record, 74 Fed. Reg. 66132 (Dee. 14* 2009). The Factual andLegal Analysis, which explains the Commission's finding, is enclosed fb r your information.Ifyou. have any questions, please contact Kamau Philbert, the attorney assigned to thismatter at (202) 694-1650.

Sincerely,ItPeter Blumberg

Assistant General CounselEnclosureFactual and Legal Analysis


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I EDERAL ELECTION COMMISSION23 FACTUAL AND LEGALANALYSIS456 RESPONDENTS: Crabtree fo r P SC M U R : 66637 and Perry M iller in his o fficial.8. capacity as treasurer9 Brad Crabtree101112 I. INTRODUCTION

13 Complainant alleges iiata candidate fo r the North Dakota Public Service Comniission,14 his committee fo r that election, and the committee's treasurer, failed to disclose, an electioneering15 communication that allegedly attacked a sitting member of the iPublic. Service Commission, who

16 was also acandidate fo r Congress. Respondents assert that the communication, a radio17 advertisement, was exemptfromregulation because the communication, was entirely focused on18 a state election, a non-federal committee paid for it, and the communication did not promote,19 support, attack or oppose ("PASO") a federal candidate. The Commissionfindsno reason to20 believe that the Respondents violated the Federal Election Campaign A ct* as amended, ("FECA"21 or the "Act") or Commisision regulations and closed the file.22 II. FACTS23 Brad Crabtree was a candidate in the November 6,2012 election for a vacant seat on24 North Dakota's three-member Public Service Commission .("PSC"), the agency that regulates25 North Dakota's public utilities. Crabtree for PSC was his slate campaign committee for that26 election, and Perry Miller was the treasurer Of Crabtree for PSC. Kevin Cramer, one of die two27 incumbent commissioners on the P S C , was also a candidate fo r North Dakota's sole28 congressional district in the general election. Cramer filed his Statement of Candidacy with the29 Commission on October 27, 2011.


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MUR 6663 (CrabU-ee for PSC)Factual andLegal AnalysisPagc2

I Crabtree forPSC produced a 30-second radio advertisement that was broadcaist on2. various North Dakota radio stations during the periodbetween August 6 and Septeniber 30>3 2012. Theadvertisement featured Crabtree stating:4 I'm Brad Crabtree, candidate forPublic Seirvice Comniissioner. 1believe5 youdeserve morefromyour public ofticials. It's wrong forregulators to6 take political moneyfromnterests they regulate.. But Public Service7 Commissioners Kevin Cramer and BrianKalkhave taken thousands of8 dollars from the veiy companies andexecutives whose projects they9 approve. Our PSG Commissioners aresupposed to watch out for folks10 like you, not just thepeople who sign the checks.

12 Tliat's why I've pledged not toaccept any contributions fromcompanies1 3 orexecutives with interests before the PSC, It's not whaf candidates .say,.14 but what they do that matters. See for ypitfself atcrabtree ^15 where I post the contributions mycampaign receives.1617 I'mBradCrabtree, candidate tor Public Semce Commissioner. I'd18 appreciateyour vote to help me putyou - the public - back into the Public19 Service Commission.2021 Get therest of the story at crabtreeforpsccom. Paid forbyCrabtree for PSC,22 Perry Miller, Treasurer.2324 Compl.,Attach 1.

25 The Complaint allegestiiatthe advertisement was:an undisclosed.electioneering26 communication because the advertisement expressly attacks Cramer, a candidate for federal27 office, was publiclydistributed witiiin60 days of theNovember 6general election, andwas28 targeted to the relevant electorate. It further states' that (Z)rabtree is not eligible for the29 "exemption available to state and localcandidates" because the advertisement attacked or30 opposed Cramer.


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MUR 6663 (Crabtree for PSC).Factual andLegal AnalysisPage 3

1 In supportof its allegation, the Complaint provideda list of disbursements to radio2 stations showingthatCrabtree for PSC paid a total of $28304.40to airtiieadvertisement.'3 Compl., Attach2. The disbursements are eachbrokendOwnbydateranges oftento 15 days.4 As shown in the tablesbelow $5913.10of tliedisbursements made for the advertisementaired5 duringperiods oftimethat are entirely within the.66-day electioneeringcommunicationwndow6 ofSeptember7 throughNovember 5. SeeTable\, infra. Ah additional$6,163.20 in7 disbursements for the advertisementairedduringa l2-.dayperiod, of whichonlyone day8 (September 7) isinside the electioneeringcommunicationwndow See Table2, infra. Finally,9 $ 15,728.10 in disbursements were for the advertisement that^aired completely Outsidie the

10 electioneering comm unication window. See Table 3, infra.

Table 1: Ads Broadcast Within Eiectibnib ^Radio Stations Broadcast Dlitcs. .... - Broadcast Costs

K M J O F M 9/18-9/28 i " . . . $i6Ll7.lOKFGO AM 9/18-9/28 $1,224.00 ..KBYBFM 9/18-9/28 $1,42$.00._.:_..

KFYR & KBSS i& KQDY 9/17-9/30 $1,58 .00KCJB 9/18-9/28 $476.00KIZZ 9/18-9/28 $579:00

TO TA L $5*913.1011

' In an effort to Verify the reliability of the list, theOffice,ofConiplaihts Examination and LegalAdministration ("CELA") contacted theComplainant by telephone to. inquire about the source of the disbursementinformation. Complainant mfonhed CELA that the-North Dakota RepublicanParty's media vendor obtained theinformation directlyfromthe:radio stations, but he offered no.oiher details or documents, and instead asked that we"exercise[ ].some discretion" and "refrain [ ]from r i i t h e rprosecution of thecomplaint"because complainant nowbelieves that the violations were "inadvertent." E-mailfromRobert Harris, Treasurer, N.D. Repub. Party, to JeffreyS. Jordan, Supervisory Att'y, FEC (Jan. 14,2013).^ An expense identified by Complainant to KOVC AM,, for $500, for an invoice covering August 30-September 7 was excludedfrom he calculations because this radio station does not reach 50,000 or more listSe e 11 C.F.R. 100.29(c)(6)(i). The Commission confirmed that each of the other radio stations that broadcadvertisement is capable of reaching 5Q,000.or .more persons iri North Dakota, the relevant electorate. Id.


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MUR 6663 (Crabtree for PSC)Factual and Legal AnalysisPage 4

Table 2: Ads Broadcast Partially Within Electioneering Communication WindowRadio Stations Broadcas,t Dates BrDa.dca.st CostsKCJB 828-:97 $499:00

KIZZ .....8/28-9/5 . . . $226.00"KMjOFM '"" llS7". "JT $504:00K F G O A M " 8fe7-.9/7 " " 11,0:2.4 .KBVB FM ; 8/27-9/7" ' . .$1,33:2..8QFBVR A M 8/2M/7 :$5l60.iOQ

KSSS 8/27-9/7 $4.94.00KQDY 8/27-9/7 ...,.$.495.00

TOTAL $6,163.20Table 3: Ads Broadcast Oatsiiie Electioneering Gomniiinication Window ..

Radio Stajtions Broadcast Dates'. BroadcastGdsts- ...KQDY 8/8-8/21 $i;092,00KFYR 8/B) 8-2I $1,380:00KNOX 8/6-8/19 $2.5Q0.00KMJO 8/7-8/17 $1,23:9.30

KFGO_AM 8/7-8/19 $5,530.10KCJB 8/8-8/17 $iS62.00KIZZ 8/8-8/17 $361.00ic:$iB&Ksiz 8/.9-.8A2 i $1,001.30

KOVC & KQDJ . 8/15-8/29 $1,000.00KQDJ 8/30-9/6 $200.00

KLTC & KCA D w/o 9/5 $762.40TOTAL $15,728.10

4 Respondents seekdismissal Of the Compliaiht on the grounds,thattheadvertisement5 related to a stateelectionoverwhich North Dakota law has exclusivejurisdiction. Resp. at 3.6 The Response furtiier claims thatthe communication is exemptfrom Commission regulation

^ Respondents' claim that ihis advertisement is exclusively governed by North Dakota law isaddressed bythe plain language ofthe "state and local candidate" exemption, under 11 C.F.R. 100.29(c)(5), which indicates, thatgenerally only ads that PASO a federal candidate are reportable under FECA.


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M U R 6663 (Crabtree for PSC)Factual and Legal. AnalysisPage 5

1 because it does not constitute "federal election activity" as defined by FECA,.ahd because the2 communication qualifies for the "state or local candidate" exemption fo the electioneering3 communications rules under 11 C.F.R. 100.29(c)(5) - because it was paid for by a state4 candidate in connection with a state election land does not PASO a federal candidate. Id. at 2-4.5 The Response charges that iieComplaint omits "material' facts" concerning the circumstances of6 the election and the related advertisement, including that Cramer, along with Brian Kalk, were7 sitting members o f the P S C who had a practice of accepting contributions from the regulated

9 Crabtree's campaign. Id. at 2. Thus, Respondents arguCj when viewed in this Contexti it is8 community and that a criticism of Cramer's and Kalk's practice was a "signature issue" in

10 apparent that the communication was focused exclusiively on Crabtree's effort to be:elected to11 the PS C and did not attack Cramer as a federal candidate or oppose Cramer's congressional12 candidacy. See Resp.at 2-3. In their view, the advertisement Criticizes Cramer solely in his role13 as an incumbent PS C commissioner and that "any unmentionedconnotation or inference" to14 Crabtree's federal candidacy was "merely incidental." Id. at 2-3 & 5.15 III. LEGAL ANALYSIS16 The Complaint alleges that Respondents violated the Act by airing an electioneering:17 communication that cost in excess of $10,000 without filing a required 24 Hour Notice of18 Disbursements for Electioneering Communications (FEC Fotm 9) ("24 Hour Notice"). An19 electioneering communication is a broadcast, cable, or satellite communication that: (1) refers to20 a clearly identified candidate fo r federal, office; (2) is made v/iibm 60 days before a general,21 special, or runoffelection for the office, sought by the candidate...; and (3) is targeted to the

" Respondents provided copies of several,news reports and press releases from April to October 2012concerning Crabtree's prior criticism ofthe two incumbent PSC commissioners. See Resp. at 2, Ex. 2.


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MUR 6663 (Crabtree for PSC)Factual and Legal AnalysisPage 6

1 relevant electorate. 2 U.S.C. 434(f)(3)(A); 11 C.F.R. 100.29(a).. A "clearly identified2 candidate" means that the candidate's name, nickname, ishotograph,. Or drawing;appears. Or the3 identity of the candidate is. otherwiseapparent through an unambiguous reference. 11 C.F,R,4 100.29(b)(2). A communication is "targeted to the relevant electorate" when it cah be received5 by 50,000 or more persons in the district the candidate seeks to represent.. 1.1. C .F.R.6 100.29(b)(5). A communication that is paid for by a eandidate for state or local office in7 connection witha state or local election and does not promote, support, attack or oppose a8 federal candidate is exempt from the statutory definition of electioiieeritig commuriication. 9 11 C FR . 100.29(c)(5).

10 Persons who make aggregatedisbursements exceeding $10,000 for the cost of producing1.1 and airing electioneering communications during any calendar year must. Wthin 24 hours of12 each disclosure date, disclose information regarding the commuriication. 2 .U..S.C. 434(f)(.l,).13 The disclosure must include the identity of the person making the disbursement; the identity Of14 any person sharing or exercising direction or control over the activities of such person; the15 amount and recipient of each disbursement over $200; the electioh to which the communication16 pertains and the naniie of the identified candidate; and the names and addresses of contributors17 who give $1,000 or more in the calendar year totiiepersonmaking the disbursement. 2 U.S.C.18 434(f)(2); 11 GF.R. 104.5(i), 104.20.19 Based ontiienformation supplied bytiieComplaint, $6,529 was spent to broadcast the20 advertisement within the electioneering communication window. Additional amounts were

' When electioneering communicadbns are distributed, both, inside and outside of the electioneeringcommunications window, only those costs to produce and bro cast the advertis..ement witHih the electipneeriiigcommunications window are rep.brtable. See 2 U.S.C: 434(Q(2)(C);AVhennecessary, these costs i re prorated tpexclude costs for distribution outside the window. Id; Table 1, jifpra, shows that.$S,913 was.spent fbf air time that


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MUR 6663 (Crabtree for PSC)Factual and Legal AnalysisRage?

1 necessarily spent to produce the advertisement,,but it does not appear, that the prorated share of2 these production costs would have beeh sufficient to reach the $10,000 threshold.3 Thus, regardless ofwhether the advertisement was an electioneering communication, the4 available informationshows that the CQ$ts ofCrabtree'stadiO advertisement did. not surpass the5 $10,000 direshold requiritig disclosure. 2 U.S.C. 434(f)(1), Therefore, .RespOhdefite had hO6 obligation to file a.24Hour Notice with the Commission.

7 Accordingly, the Commission finds that there is no reason to believe that the Committee8 viblated 2 U.S;C. 434(f) by failing tofilea 24Hour Notice in connection with the radio9 advertisement and closed the file.

clearly fall within the electioneering communications window. Further, one day (September 7) ofthe IjO dayscovered by the disbursements included ih Table 2,.si/;?r

005 Notification to Crabtree

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