970 C.M.R. 2.18 – Subvendor Reporting

(1) Location for Filing of Reports. Reports required to be filed by M.G.L. c. 55, § 18D are electronically filed with the Director, or if the expenditure concerns a local candidate who does not file with the Director, or a local ballot question, with the clerk.
(2) Vendor Accounting of Expenditures. A vendor that makes an expenditure on behalf of a political committee or on behalf of an individual or group required to file a report of ballot question expenditures under M.G.L. c. 55, § 22, shall, once the vendor has made expenditures to a particular subvendor that aggregate $500 during a calendar year, provide the political committee, individual or group with a detailed account of the expenditures within five days, in accordance with M.G.L. c. 55, § 18D(b). Vendors are not required to provide this information to the committee, individual or group, prior to reaching the $500 threshold. Upon reaching the $500 threshold, the detailed account provided to the committee, individual or group shall describe all expenditures made, including those made prior to reaching the threshold.
(3) Definition of Subvendor. A Subvendor is any individual who provides goods or services to a vendor or who contracts with a vendor to provide goods or services to a committee, or to an individual or group required to file a report of ballot question expenditures under M.G.L. c. 55, § 22, except the following persons or businesses are not considered subvendors under M.G.L. c. 55, § 18D.
1. (a) A person who is an employee of a vendor, and has been an employee of the vendor for a period of at least three consecutive months prior to any month in which a committee, individual or group is required to file a subvendor report.
2. (b) An individual or business that provides goods or services to another business or individual in the usual course of business. For example, a business that has an existing agreement to provide a printing company with paper and ink is not a subvendor.
3. (c) An individual or business that provides goods or services to a subvendor.
(4) Obligation of Political Committee, Individual or Group to Obtain Subvendor Information.
1. (a) A political committee, or an individual or group required to file a report of ballot question expenditures under M.G.L. c. 55, § 22, which makes a payment to a vendor of $5,000 or more in the aggregate during a calendar year, or which incurs liabilities to a vendor in that amount, must make inquiry, in writing, to the vendor regarding whether subvendors were paid by the vendor. A committee, individual or group satisfies this requirement by asking at least once for subvendor information.
2. (b) A political committee, or an individual or group required to file a report of ballot question expenditures under M.G.L. c. 55, § 22, which does not receive an account of subvendor expenditures from a vendor shall keep a copy of any written correspondence it sends to the vendor seeking such information.
3. (c) A vendor is not required to provide subvendor information to a committee if the vendor provides a statement to OCPF annually certifying that the vendor does not use subvendors. Vendors that provide this statement to OCPF must notify OCPF if circumstances change.
(5) Provision of In-kind Contributions. An individual or entity that provides an in-kind contribution to a political committee of $5,000 or more in the aggregate during a calendar year is a “vendor” for purposes of M.G.L. c. 55, § 18D and must provide the political committee with the full name and address of any subvendors who received payments from the vendor of more than $500 in connection with the in-kind contribution during the calendar year.
(6) Subvendor Reporting by Independent Expenditure PACs. An independent expenditure PAC that makes expenditures requiring the filing of a subvendor report under M.G.L. c. 55, § 18D, shall electronically file a subvendor report disclosing the expenditures as part of the independent expenditure PAC’s year-end report filed in accordance with 970 CMR 2.17(4)(c).