Democrat David Shapiro, a candidate for Florida’s 16th Congressional District, appears to be at risk of violating the Federal Elections Commission’s reporting requirements by failing to list in-kind contributions made by Shapiro to his campaign. That’s according to documents reviewed by Florida Politics.
Now, his campaign says it is in the process of correcting the issue, telling Florida Politics it will be resolved in the next FEC filing.
The potentially problematic in-kind contributions are in the form of free space provided to the campaign in a building owned by Shapiro. That building also doubles as one of his law offices.
While the arrangement does not appear to violate any FEC rules on its face, the lack of proper reporting to the FEC could trigger a violation. Potential punishments range from an administrative fine to a full audit.
Shapiro’s campaign confirms space was used inside his Sarasota law office during the campaign, though the organization is in the process of moving to a new building.
That use is fair game. According to the FEC’s Campaign Guide, “A campaign committee … may rent part of an office building owned or leased by the candidate for use in his or her campaign, as long as it pays no more than the fair market value for the space.”
The FMV cap is designed to prevent campaign committees from funneling money above a normal rate of rent to the candidate himself. Shapiro’s campaign does not come anywhere near that limit, as they appear to have paid no rent whatsoever.
Paying zero rent is not inherently a violation either. The campaign’s use of the building (which Shapiro owns) for no charge means Shapiro is in effect waiving that charge for the campaign. That would be considered an in-kind contribution.
The FEC’s Campaign Guide on in-kind contributions reads, “Goods … are valued at the price the item or facility would cost if purchased or rented at the time the contribution is made.”
By not charging rent, Shapiro is essentially “donating” the FMV amount to the campaign. And there’s no cap on the amount candidates may contribute to their own campaign, so Shapiro is well within his rights to make such contributions.
The problem arises from the fact the campaign has not reported any of this as an in-kind contribution. Again, from the FEC’s Campaign Guide, “Like all receipts, contributions are also subject to the [Federal Election Campaign] Act’s recordkeeping and reporting requirements.”
That means Shapiro’s campaign should be reporting the contributions “at the price the … facility would cost if purchased or rented.” Shapiro has not done so, according to his financial documents filed with the FEC.
While the FEC would not directly comment on the outcome of any specific case, it does appear that Shapiro is in murky waters here when it comes to the lack of reporting, according to the FEC rules.
As noted, the campaign does now say the issue will be resolved in the next filing period. Any future in-kind contributions regarding their new building would be reported as well, according to the campaign.