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Why Hasn’t Unity08 Registered as a PAC?

Unity08 (aka Unity 08) is a registered corporation with the goal of arranging the nomination of one Republican and one Democrat to become the next president and vice president of the United States of America. It declares that next year it will successfully run the first-ever national secure online presidential nomination.

The Federal Election Commission (FEC) list of advisory opinions for 2006 shows a process concluding on October 10, 2006 with a final advisory opinion issued by the FEC. That advisory opinion reads:

The Commission concludes that Unity 08 will have to register as a political committee once it makes expenditures in excess of $1,000, and therefore will be subject to the amount limitations, source prohibitions, and reporting requirements of the Act.

and again:

Unity 08 will become a political committee once it makes more than $1,000 in expenditures. Unity 08 must register with the Commission by filing a statement of organization within ten days after becoming a political committee, and it will be subject to the provisions of the Act and Commission regulations applicable to political committees.

and further:

The Commission notes that Unity 08 must also register as a political committee if it accepts more than $1,000 in contributions.

The FEC rejected Unity08’s request to be classified as a 527 organization and required that instead it be classified and registered as a Political Action Committee (PAC). There is no follow-up reported to the advisory opinion, and no report in the newspapers, on the Unity08 website, at the Campaign Legal Center or any other location I can find indicating that Unity08 has filed any sort of legal appeal. Besides, Unity08 explicitly stated:

The FEC will determine whether or not we are a political committee for FEC purposes. Obviously we will follow their opinion.

As the 2nd quarter and 3rd quarter reports by Unity08 to the IRS under its previous designation as a Section 527 organization show, Unity08 had already well surpassed expenditures of $1,000 by September 30, 2006. As of October 10, 2006, Unity08 was informed of its legal duty to register as a PAC. That made a ten-day deadline of October 20, 2006 for Unity08 to register as a PAC.

The FEC updates its filed reports with promptness:

Information taken from the reports committees file with the FEC is available to the public within 48 hours of the agency’s receipt of the report. Reports filed electronically are available on the web almost instantaneously.

So, by October 22, 2006 we should have seen a report of Unity08’s filing as a political action committee.

But a search carried out today, January 4, 2007 — two months and 13 days after the F1 statement of organization should have appeared on the FEC system — turns up nothing. The search was tailored for any FEC filings or statements and was set to turn up any PAC with the letters “unity” in it — even PACs with the word “Community” appeared — and so was quite inclusive.

What explains this? Either:

1) Unity08 has registered itself under a name that does not contain the word “Unity”, or
2) The FEC has botched the job and lost the documents or fed them to the office dog, or
3) Unity08 has not filed any documents as a PAC, contrary to the specific instructions of the FEC advisory opinion it received on October 10, 2006.

What do you think happened?

13 comments to Why Hasn’t Unity08 Registered as a PAC?

  • Alan

    I too did a search of FEC website for Unity 08 filings a few days ago and found nothing. I also did an address search for both PO box 13331 Denver, Colorado and 1801 California Street Denver, Colorado, also turning up nothing. The website also has a feature to search by name of treasurer, so I plugged in the names of people who have signed documents in the past, or been publicly identified as treasurers: Karla Johnson-Grimes(IRS documents), Natasha Garfield, Claudia P. Schechter, and Douglas Bailey. Nothing.

    The way I read the FEC requirements, a PAC must choose to report either every quarter or every 6 months, and they have to tell the FEC which system they will be using. It also looks to me that whatever system Unity08 is using, they will have to file something by January 31. There is also a question of the 2nd quarter of 2006, which should have something filed for it–oh, but if they didn’t reach the $1000 mark until September, maybe not.

    If they just ignored the FEC’s advisory opinion, would someone have to take them to court and sue them? The FEC does impose fines. The advisory ruling also said they have the kind of corporate status or something for bankrupcy. I’m not an attorney, but that sounds like Unity08 can declare bankrupcy without affecting the parent consulting business.

    My spider sense tells me they want to be a DC organization (actually it says so in the NC incorporation papers filed from the Raleigh, NC address), so I think they will use their address at the Watergate when they file, if they file. I also think they are renting something like a conference table space in someone else’s business in that building.

    Not much transparency there. They make a big to-do about other campaigns “walking the walk”, but it doesn’t look like they themselves can walk and chew gum at the same time. Actually I think the original phrase was “fart and chew gum” but it was cleaned up for mainstream press.

  • Jim

    Actually, it’s quarterly or monthly. And there’s a Statement of Organization (F1) document that must be filed within 10 days of $1,000 in contributions or $1,000 in expenditures — standards that were reached well before the end of the 3rd quarter, as you can see if you follow links to the very, very incomplete 2nd and 3rd quarter IRS reports. Finally, there is a 2nd quarter IRS filing, and a 2nd quarter FEC filing would not be necessarily required, since the FEC ruling did not occur until part of the way into the 4th quarter.

    Good to know on the searches by name and address.

  • Alan

    I read this to mean semi-annual reporting is an option for PAC’s:

    http://www.fec.gov/info/report_dates.shtml#frequency

    Either way, close of books is Dec.31, 2006 and final report is required Jan.31, 2007.

  • Jim

    I stand corrected on that point.

  • Alan

    Okay, that’s how I read it too.
    Ms. Harris now claims IRS reports have been filed, but 4th quarter is not available at IRS website:

    http://forms.irs.gov/politicalOrgsSearch/search/basicSearch.jsp

  • Iroquois Honky

    I just read Jim’s post on the UNITY08 site about the “It’s your movement” Email they sent him. Movement? Hee, hee.

    Q:What’s brown and sits on a piano bench?
    A:Beethoven’s fifth movement.

    Hee, hee, hee.

    I do so love scatological humor.

  • Alan

    Did I say quarterly? The options are semiannually or monthly, according to footnote #4.

  • Alan

    The 3rd quarter report has disappeared from the IRS site, but the 2nd quarter report is still there. The 3rd quarter was still on as of yesterday. Wonder how that went down the memory hole.

    But why are they filing with the IRS at all?–PAC’s file with the FEC.

  • Jim

    In the 2nd quarter and 3rd quarter, they filed with the IRS because they claimed 527 status. But they were informed at the beginning of the 4th quarter that they would have to register as a PAC, which they have not done.

    Here’s the nibbly bit — Unity08 says it’s going to CONTINUE to file with the IRS, despite being directed to register as a PAC and file with the FEC.

    I had a new question to ask about that right here.

  • Alan

    Their “financial transparency” response doesn’t address the PAC/527 issue at all. But I see communication director Shane Kinkennon is doing well enough to contribute another $250.

    http://www.unity08.com/node/584#comment-11378

    The FEC opinion was based on the assumption that Unity08 would be a place-holder for an eventual presidential candidate on ballots in 50 states, a project that would cost considerably. Rumors from the Unity 08 backroom talks with Bloomberg, the guy with the big money, say he isn’t interested in the 50-state ballot thing. Maybe Bloomberg is angling for the Republican nomination. Funny how rumors of talks surfaced when the reports were due.

  • Jim

    Oh, there’s just a whole lot of stuff going on that Unity08 isn’t telling anybody. Some “grassroots organization.”

  • Alan

    Well, we’ve cross-posted, but somehow the remarks still have continuity–I can see how unity08 would want to correct any errors in their preliminary IRS report, but technically, I don’t understand why they have to bother with the IRS at all now, much less with the Jan 31 report, which they say they will file.

    Discussions about campaign finance reform talk about the problem of 527’s and link them to “soft money” and lack of transparency, but I really don’t understand the mechanism behind it.

  • Alan

    Another cross post, which probably means I should stop hogging the comments.

    My spider sense tells me unity08 is being run day-to-day by people from some other organization who still have to do their regular jobs, hence the slowness in completing reports. I suspect they are getting a whole lot more than $5000 worth of donated services from somewhere. You can see the tip of the iceberg, but not what’s under it.

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