ENGROSSED SUBSTITUTE HOUSE BILL 1379

ByHouse State Government & Tribal Relations (originally sponsored by Representatives Pellicciotti, Hudgins, Appleton, Gregerson, Pollet, Macri, Valdez, Kloba, Bergquist, Tarleton, Doglio, Frame, Goodman, Reeves, and Fey)

AN ACT Relating to disclosure of contributions from political committees to other political committees; amending RCW 42.17A.320; adding a new section to chapter 42.17A RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

The legislature finds that campaign finance disclosure is overwhelmingly supported by the citizens of Washington state as evidenced by the two initiatives that largely established Washington's current system. Both passed with more than seventy-two percent of the popular vote, as well as winning margins in every county in the state.

One of the cornerstones of Washington state's campaign finance disclosure laws is the requirement that political advertisements disclose the sponsor and the sponsor's top five donors. Many political action committees have avoided this important transparency requirement by funneling money from political action committee to political action committee so the top five donors listed are deceptive political action committee names rather than the real donors. The legislature finds that this practice, sometimes called "gray money" or "donor washing," undermines the intent of Washington state's campaign finance laws and impairs the transparency required for fair elections and a healthy democracy.

Therefore, the legislature intends to close this disclosure loophole, increase transparency and accountability, raise the level of discourse, deter corruption, and strengthen confidence in the election process by prohibiting political committees from receiving an overwhelming majority of their funds from one or a combination of political committees.

NEW SECTION.  Sec. 2. A new section is added to chapter 42.17A RCW to read as follows:

(1) For any requirement to include the top five contributors under RCW 42.17A.320 or any other provision of this chapter, the sponsor must identify the five persons or entities making the largest contributions to the sponsor in excess of one thousand dollars reportable under this chapter during the twelve-month period preceding the date on which the advertisement is initially to be published or otherwise presented to the public.

(2) If one or more of the top five contributors identified under subsection (1) of this section is a political committee, the top three contributors to each of those political committees during the same period must then be identified. Of those contributors to political committees, the sponsor must identify the three persons or entities who made the largest contributions in excess of one thousand dollars reportable under this chapter during the same period. The names of those top three persons or entities must be displayed in the advertisement alongside the statement "Top Three Donors to PAC Contributors."

(3) Contributions to the sponsor that are earmarked, tracked, and used for purposes other than the advertisement in question should not be counted in identifying the top five contributors under subsection (1) of this section or the top three donors under subsection (2) of this section.

(4) The sponsor shall not be liable for a violation of this section that occurs because the persons or entities making the largest contributions to any political committee identified under subsection (1) of this section have not reported those contributions to the commission.

(5) The commission is authorized to adopt rules, as needed, to prevent circumvention and effectuate the purposes of the top five contributors and top three donors disclaimers, which are intended to inform voters about the individuals and entities sponsoring political advertisements.

Sec. 3. RCW 42.17A.320 and 2013 c 138 s 1 are each amended to read as follows:

(1) All written political advertising, whether relating to candidates or ballot propositions, shall include the sponsor's name and address. All radio and television political advertising, whether relating to candidates or ballot propositions, shall include the sponsor's name. The use of an assumed name for the sponsor of electioneering communications, independent expenditures, or political advertising shall be unlawful. For partisan office, if a candidate has expressed a party or independent preference on the declaration of candidacy, that party or independent designation shall be clearly identified in electioneering communications, independent expenditures, or political advertising.

(2) In addition to the information required by subsection (1) of this section, except as specifically addressed in subsections (4) and (5) of this section, all political advertising undertaken as an independent expenditure or an electioneering communication by a person or entity other than a bona fide political party must include as part of the communication:

(a) The statement: "No candidate authorized this ad. It is paid for by (name, address, city, state)";

(b) If the sponsor is a political committee, the statement: "Top Five Contributors," followed by a listing of the names of the five persons or entities making the largest contributions ((in excess of seven hundred dollars reportable under this chapter during the twelve-month period before the date of the advertisement or communication))as determined by section 2(1) of this act; and if necessary under section 2(2) of this act, the statement "Top Three Donors to PAC Contributors," followed by a listing of the names of the three persons or entities making the largest contributions to political committees as determined by section 2(2) of this act; and

(c) If the sponsor is a political committee established, maintained, or controlled directly, or indirectly through the formation of one or more political committees, by an individual, corporation, union, association, or other entity, the full name of that individual or entity.

(3) The information required by subsections (1) and (2) of this section shall:

(a) Appear on the first page or fold of the written advertisement or communication in at least ten-point type, or in type at least ten percent of the largest size type used in a written advertisement or communication directed at more than one voter, such as a billboard or poster, whichever is larger;

(b) Not be subject to the half-tone or screening process; and

(c) Be set apart from any other printed matter. No text may be before, after, or immediately adjacent to the information required by subsections (1) and (2) of this section.

(4) In an independent expenditure or electioneering communication transmitted via television or other medium that includes a visual image, the following statement must either be clearly spoken, or appear in print and be visible for at least four seconds, appear in letters greater than four percent of the visual screen height on a solid black background on the entire bottom one-third of the television or visual display screen, or bottom one-fourth of the screen if the sponsor does not have or is otherwise not required to list its top five contributors, and have a reasonable color contrast with the background: "No candidate authorized this ad. Paid for by (name, city, state)." If the advertisement or communication is undertaken by a nonindividual other than a party organization, then the following notation must also be included: "Top Five Contributors" followed by a listing of the names of the five persons or entities making the largest contributions ((in excess of seven hundred dollars reportable under this chapter during the twelve-month period preceding the date on which the advertisement is initially published or otherwise presented to the public))as determined by section 2(1) of this act; and if necessary under section 2(2) of this act, the statement "Top Three Donors to PAC Contributors," followed by a listing of the names of the three persons or entities making the largest contributions to political committees as determined by section 2(2) of this act. Abbreviations may be used to describe contributing entities if the full name of the entity has been clearly spoken previously during the broadcast advertisement.

(5) The following statement shall be clearly spoken in an independent expenditure or electioneering communication transmitted by a method that does not include a visual image: "No candidate authorized this ad. Paid for by (name, city, state)." If the independent expenditure or electioneering communication is undertaken by a nonindividual other than a party organization, then the following statement must also be included: "Top Five Contributors" followed by a listing of the names of the five persons or entities making the largest contributions ((in excess of seven hundred dollars reportable under this chapter during the twelve-month period preceding the date on which the advertisement is initially published or otherwise presented to the public))as determined by section 2(1) of this act; and if necessary under section 2(2) of this act, the statement "Top Three Donors to PAC Contributors," followed by a listing of the names of the three persons or entities making the largest contributions to political committees as determined by section 2(2) of this act. Abbreviations may be used to describe contributing entities if the full name of the entity has been clearly spoken previously during the broadcast advertisement.

(6) Political advertising costing one thousand dollars or more supporting or opposing ballot measures sponsored by a political committee must include the information on the (("Top Five Contributors" consistent with subsections (2), (4), and (5) of this section))top five contributors and top three donors to political committee contributors as required by section 2 of this act. A series of political advertising sponsored by the same political committee, each of which is under one thousand dollars, must include the (("Top Five Contributors" information required by this section))top five contributors and top three donors to political committee contributors as required by section 2 of this act once their cumulative value reaches one thousand dollars or more.

(7) Political yard signs are exempt from the requirements of this section that the sponsor's name and address, and (("Top Five Contributor" information))the top five contributors and top three donors to PAC contributors as required by section 2 of this act, be listed on the advertising. In addition, the public disclosure commission shall, by rule, exempt from the identification requirements of this section forms of political advertising such as campaign buttons, balloons, pens, pencils, sky-writing, inscriptions, and other forms of advertising where identification is impractical.

(8) For the purposes of this section, "yard sign" means any outdoor sign with dimensions no greater than eight feet by four feet.

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