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S.F. No. 661 - Campaign Finance Policy and Technical Bill (as Amended by the A-1 Amendment)
 
Author: Senator Ann H. Rest
 
Prepared By: Alexis C. Stangl, Senate Counsel (651/296-4397)
 
Date: February 22, 2013



 

S.F. 661 includes policy and technical changes to the campaign finance and public disclosure laws (chapter 10A). Article 1 contains the policy changes, including requirements for ballot question political committees and funds; requirements relating to electioneering communications; increased contribution and expenditure limits based on an election cycle; increases in reporting thresholds; expansion of the Campaign Finance and Public Disclosure Board's jurisdiction to include some fair campaign practices provisions and other changes to reporting requirements and procedures. Article 2 makes technical changes to chapter 10A. Article 3 makes conforming changes to go along with Article 2. Articles 2 and 3 are the same as S.F. 496.

Article 1.  Policy Changes

Sections 1 and 2 define “ballot question political committee” and “ballot question political fund.”

Section 3 changes a cross-reference to a newly renumbered section.

Section 4 clarifies that an allocation by an association of general treasury money to its political fund is considered to be a contribution for purposes of Chapter 10A.

Section 5 defines “expressly advocating.”  This reflects the U.S. Supreme Court holding from Wisconsin Right to Life v. FEC that disclosure can be required for communications using express advocacy as well as those that are the functional equivalent of express advocacy.

Section 6 defines “general treasury money.”

Section 7 defines “person.”

Section 8 clarifies that a political committee may support one or more candidates.

Section 9 clarifies that a political fund may support one or more candidate. This section further clarifies that a political fund may also refer to an association acting through its political fund.

Sections 10 and 11 make conforming changes to match the changes made in Section 12.

Section 12 expands the Board’s authority to investigate alleged violations of specified provisions of the fair campaign practices chapter.  The expansion of authority only applies to those already under the Board’s jurisdiction.  The sections are 211B.04 (campaign literature disclaimer), 211B.12 (legal expenditures), and 211B.15 (corporate campaign contributions).  Under current law, these issues fall under the jurisdiction of the Office of Administrative Hearings. Provides that the Board may bring a legal action to recover money that was raised from contributions subject to specified conditions.  The process the Board must follow prior to bringing legal action is specified. The manner of distribution for recovered funds is described. Provides that the Board must dispose of a matter under its jurisdiction before a violation may be prosecuted by a county attorney.

Section 13 allows the Board to issue advisory opinions over the 211B sections specified in Section 12.

Section 14 strikes a reference to individuals being guilty of a gross misdemeanor and moves the penalty later in the same subdivision.  An individual must not sign a report or statement knowing it contains false information or omits required information.  An individual must not provide false or incomplete information to a treasurer intending the treasurer will rely on that information.  A violation is a gross misdemeanor and the individual may be subject to a civil penalty of up to $3000.  The Board may impose an additional civil penalty of up to $3000 on specified entities affiliated with the violator.

Section 15 extends recordkeeping requirements to an individual that has accepted record-keeping responsibility for the filer.  The Board may impose up to a $3000 civil penalty on a person who violates this section, with an additional civil penalty of up to $3000 on affiliated entities.  A violation is a gross misdemeanor.

Section 16 changes the threshold for forming a political fund account from $100 to $750.

Section 17 changes the threshold for forming a political fund from $100 to $750.

Section 18 changes the threshold for forming an independent expenditure political committee or fund from $100 to $1500.  The threshold for forming a ballot question political committee or fund is $5000.

Section 19 clarifies that it is not considered to be commingling funds for an association that uses only its own general treasury money to make permitted expenditures and disbursements directly from the general treasury depository.  If an association accepts more than $1500 in contributions to influence the nomination or election of candidates or more than $5000 in contributions to promote or defeat a ballot question, the association must establish a separate depository.

Section 20 lists permitted disbursements for an independent expenditure political committee or fund and for a ballot question political committee or fund.

Section 21 changes the threshold for filing a registration statement from $100 to $750, consistent with changes made in Sections 16 and 17.  This section does not apply to ballot question or independent expenditure political committees or funds specified in Section 22.

Section 22 provides the process for the first registration and reporting by independent expenditure or ballot question political committees and funds.  The threshold for forming such a committee or fund is receiving or spending more than $1500 in a calendar year for independent expenditures or spending or receiving $5000 in a calendar year to promote or defeat a ballot question.  These thresholds are consistent with changes made in Section 19.

Section 23 increases the amount of money a committee may accept without knowing the source from $20 to $50.

Section 24 requires an individual who receives a contribution of more than $50 to provide specified information about the contributor.

Section 25 increases the time in which a treasurer may return a contribution from 60 days to 90 days.

Section 26 links the need to begin filing required reports to the threshold for the entity rather than to a specific dollar amount.

Section 27 requires a state party committee, a party unit, and principal campaign committees of candidates for constitutional or appellate court judicial office to file the same reports currently required by political committees and funds. The timing of the reports is specified.

Section 28 specifies that the required report must include each of the specified items that are applicable to the filer, instead of requiring all filers to provide all information. The Board must create forms based on filer type that indicate which items must be included.  The itemization threshold is increased from $100 to $200. This section adds reporting requirements for electioneering communication disbursements.

Section 29 separates out different recipients and specifies the threshold based on the office for the pre-election report. The notice requirement for candidates, other than judges, is set at half of the election cycle contribution limit (instead of the current 80% of the annual contribution limit). The reporting requirements do not apply to ballot question or independent expenditure political committees or funds that have not met the registration threshold.

Section 30 requires a candidate that does not have a principal campaign committee to file the specified report when the candidate spends more than $750, which is increased from $100. An individual who makes independent expenditures of more than $1500 in a calendar year or expenditures to promote or defeat a ballot question of more than $5000 in a calendar year must file the required report.

Section 31 specifies that the treasurer of a principal campaign committee, party unit, or political committee (instead of any reporting entity) must file a statement of inactivity if there are no receipts or expenditures during a reporting period.

Section 32 specifies that an association is not required to file any statement or report for a reporting period when the association accepted no contributions and made no expenditures from its political fund.

Section 33 adds a new disclosure category for electioneering communication. A definition is provided for “electioneering communication.” Electioneering communications made by a political committee, party unit, or principal campaign committee must be disclosed. Any other association may register a political fund and disclose its electioneering communications on the fund’s reports. An association that does not disclose under either of the methods above must disclose its electioneering communications as provided. A person who makes a disbursement of more than $1500 in a calendar year for producing or distributing electioneering communications must file a disclosure statement with the board containing the specified information. An electioneering communication must include a statement of attribution. The statement to be included depends on the type of communication.  Late fees and civil penalties may be imposed for failure to file a required statement.

Section 34 strikes a cross-reference to a section that is repealed by the bill and strikes a cross reference to the section relating to return of public subsidy money.

Section 35 allows a political committee, political fund, principal campaign committee, or party unit to terminate after it has disposed of all of its assets in excess of $100. The termination is done by filing a report of receipts and expenditures and must be identified as a termination report. A definition of “assets” is provided. Parameters around the disposition of assets are provided. This section replaces the current section of law on termination that is repealed by the bill.

Section 36 allows an association that has a political fund to choose to have the fund placed on voluntary inactive status if the specified conditions are met. While on inactive status, the association is not required to file reports. The association may not accept contributions or make expenditures while on inactive status. An association can return to active status by notifying the board. A civil penalty may be imposed for conducting financial activity while on inactive status.

Section 37 specifies when principal campaign committees, political committees, political funds, and party units become inactive. The board may terminate the registration of these inactive entities by following the prescribed process. This section replaces the current section of law on dissolution of inactive committees and funds, which is repealed by the bill.

Section 38 specifies that termination of registration does not affect the liability of an association or its candidates, officers, or other individuals for obligations incurred in the name of the association or its political fund.

Section 39 makes spending limits applicable to an election cycle, rather than a single year. Spending limits are increased.  The section clarifies that the expenditure limit is increased by 10 percent for a candidate who has not previously held the same office, whose name has not previously been on the primary or general election ballot for that office, and who has not in the past 10 years raised or spent more than $750 in a run for certain other offices; current law refers only to a candidate is running for the office for the first time.

Section 40 changes spending limits applicable to multiple committees of the same candidate for constitutional offices to an election cycle limit.

Section 41 clarifies that for the purposes of the whole chapter, and not just the specified sections, a candidate for governor and a candidate for lieutenant governor are considered a single candidate.

Section 42 specifies that the principal campaign committee of a candidate must not make disbursements for electioneering communications. 

Section 43 provides that an amount of up to 25 percent of the election cycle expenditure limit may be carried forward; current law allows 50 percent of the annual expenditure limit to be carried forward.

Section 44 makes contribution limits applicable over an election cycle rather than a single year. Contribution limits are increased. An association that has a political fund or an association not registered with the board must not make a contribution that a candidate is prohibited from accepting.

Section 45 provides that a candidate who signs a public subsidy spending limit agreement may not contribute more than ten times the candidate’s election cycle contribution limit to the candidate’s own campaign during an election cycle.

Section 46 extends the aggregate special source contribution limit to include contributions from associations not registered with the Board.

Section 47 increases the amount that may be accepted from an association not registered with the Board from $100 to $200. This section specifies that this limit does not apply when a national political party contributes money to its state committee (this is in current law, but the bill places it in a different location) or to certain types of purchases by candidates.

Section 48 allows an association to contribute business revenue to ballot question political committees.

Section 49 extends the reporting of underlying sources of an association’s general treasury money to ballot question political committees or funds. This section changes how an association prorates contributions. The bill requires an association to prorate expenditures over all general treasury money received during the year. This section provides a process to attribute contributions when the amount contributed to independent expenditure and ballot question political committees or funds exceeds the amount of general treasury money receive by the association during the year.

Section 50 clarifies that in-kind contributions are not counted in an affidavit of contributions from a candidate who receives public subsidies. The candidate must file an affidavit with the board stating that the principal campaign committee has complied with the stated requirements.

Section 51 provides a cross reference in chapter 211B noting the Board’s jurisdiction for the sections 12 of the bill.

Section 52 repeals sections relating to termination that are replaced by new language in the bill. This bill also repeals a subdivision that relates to non-election-year spending limits, which is no longer necessary because the bill makes contribution limits apply to a whole election cycle.

Article 2. Technical Changes

Section 1 expands the definition of "public official" to include House and Senate fiscal analysts. Current law already includes House and Senate legislative analysts and attorneys.

Section 2 strikes a references to individuals being guilty of a gross misdemeanor and replaces it with language that says a violation of the subdivision is a gross misdemeanor.

Section 3 allows the Board to impose late filing fees starting on the day after the due date. The late filing fee is increased to $25 per day, not to exceed $1,000.

Section 4 strikes a reference to individuals being guilty of a gross misdemeanor and replaces it with language that says a violation of the subdivision is a gross misdemeanor.

Section 5 clarifies that the reporting period for a campaign report is January 1 to December 31 of the reporting year.

Section 6 corrects an internal inconsistency in the grace periods granted after a report filing deadline.

Section 7 prohibits accepting contributions from an association not registered with the Board during a legislative session. The language referencing a dissolving principal campaign committee is removed, thus allowing a terminating committee to make contributions during the legislative session.

Section 8 extends the changes made in section to the penalty provisions. The Board may bring an action to collect civil penalites; in current law, the Board is required to bring an action.

Section 9 creates a "state special elections campaign account" in the special revenue fund. The creation of this account means that funds for special election public subsidy payments are handled in the same way as other public subsidy payments. The term "fund" is stricken and replaced with "account" to use proper terminology.

Section 10 corrects a date that was not corrected when the primary election was moved to August. The requirement that a candidate must spend half of their general account public subsidy payments by a specific date is removed.

Section 11 says that money from the general fund for special election subsidy payments is transferred to the state special elections campaign account instead of to the Board.

Section 12 strikes a reference to individuals being guilty of a misdemeanor and replaces it with language that says a violation of the subdivision is a misdemeanor.

Article 3. Conforming changes

Sections 1 to 8 change the word "fund" to "account" to conform to changes made in Article 2.

 

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