AN ACT Relating to political campaigns; amending RCW 42.17.390 and 42.17.395; adding new sections to chapter 42.17 RCW; and providing an effective date.

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

NEW SECTION. Sec. 1. Unless the context clearly requires to the contrary, the definitions in this section apply throughout sections 1 through 13 of this act.

(1) "Campaign period" means the time period beginning on the day an individual becomes a candidate as provided in RCW 42.17.020(5) and ending when the final report is filed pursuant to RCW 42.17.080(2)(c). For purposes of sections 1 through 13 of this act, a write-in candidate is not a candidate.

(2) "House bulletin" means a communication sponsored by any person in the regular course of publication for limited distribution primarily to its employees or members.

(3) "Office" means the office of governor, lieutenant governor, secretary of state, state treasurer, state auditor, attorney general, superintendent of public instruction, commissioner of public lands, insurance commissioner, and member of the state legislature.

(4) "Private contribution" means a monetary contribution other than from a candidate's own funds or from the campaign reform fund.

NEW SECTION. Sec. 2. (1) Expenditures made by any person or political party for the benefit of a candidate in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate, a candidate's political committee, or their agents, shall be considered to be an expenditure by such candidate for the purposes of sections 1 through 13 of this act.

(2) No expenditure for a candidate may be made or incurred by any committee controlled by a candidate without specific written authorization of the candidate or the candidate's campaign treasurer. Every expenditure so authorized and made or incurred shall be attributed to the candidate with whom the committee is directly associated for the purpose of imposing the expenditure limitations set forth in section 4 of this act.

NEW SECTION. Sec. 3. (1) Candidates who elect to limit campaign expenditures under this chapter shall do so by signing a contract with the state agreeing to abide by limitations on the candidate's campaign expenditures.

(2) The contract shall state that the candidate knows the campaign expenditure limitations as set out in section 4 of this act and that the candidate agrees to limit expenditures by the amount set by law. The contract shall be subscribed to by the candidate and notarized.

(3) The campaign contract must be subscribed to by the individual candidate either within thirty days after the individual becomes a candidate as defined by RCW 42.17.020, or at the time of filing for the office, whichever is earlier.

(4) A candidate who has signed a campaign contract may void the contract within fifteen days after the close of filing if any other candidate who has filed for the same position has not entered into a campaign contract pursuant to this chapter. A candidate who voids the contract must return all public funds received under this chapter.

(5) A candidate who signs a campaign contract is eligible to receive public matching funds until it is determined that the candidate has no opponent at the close of the filing period or after the primary election. For purposes of sections 1 through 13 of this act, a write-in candidate is not considered an opponent or a candidate.

(6) A candidate who signs a campaign contract shall make no contribution to his or her own campaign or political committee which in the aggregate exceeds three percent of the applicable expenditure limit in any campaign year.

(7) To be eligible to receive payments under section 8 of this act, a candidate shall agree in the contract to an audit and examination under section 10 of this act, and to pay any amounts required by the commission to be paid pursuant to RCW 42.17.390.

NEW SECTION. Sec. 4. (1) For candidates who elect to limit expenditures under this chapter, the total campaign expenditures in any campaign period, inclusive of all expenditures made or authorized by the candidate and all campaign treasurers and committees authorized by the candidate to make expenditures on the candidate's behalf, shall not exceed the following amounts:

(a) Governor, one million dollars;

(b) Lieutenant governor, three hundred thousand dollars;

(d) State treasurer, three hundred thousand dollars;

(e) State auditor, three hundred thousand dollars;

(f) Attorney general, three hundred thousand dollars;

(g) Superintendent of public instruction, three hundred thousand dollars;

(h) Commissioner of public lands, three hundred thousand dollars;

(i) Insurance commissioner, three hundred thousand dollars;

(j) State senator, forty thousand dollars; and

(k) State representative, twenty-five thousand dollars.

(2) The amounts specified in subsection (1) of this section shall be adjusted by the federal implicit price deflator on January 1, 1989, and each year thereafter.

NEW SECTION. Sec. 5. The costs of preparing, printing, and circulating house bulletins and the writings, drawings, and photographs contained therein, except for paid political advertisements, shall be exempt from section 4 of this act.

NEW SECTION. Sec. 6. The campaign reform fund is hereby established in the custody of the state treasurer. Moneys in the fund may be spent only for the purpose of the public financing of election campaigns as provided in this chapter. Disbursements from the fund shall be on authorization of the public disclosure commission. The fund is subject to the allotment procedure provided under chapter 43.88 RCW, but no appropriation is required for disbursements.

NEW SECTION. Sec. 7. (1) In order to qualify to receive payments from the campaign reform fund, a candidate shall meet the following requirements:

(a) For the office of governor, the candidate has raised at least fifty thousand dollars in campaign contributions of one hundred dollars or less;

(b) For the office of lieutenant governor, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(c) For the office of secretary of state, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(d) For the office of state treasurer, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(e) For the office of state auditor, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(f) For the office of attorney general, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(g) For the office of superintendent of public instruction, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(h) For the office of commissioner of public lands, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(i) For the office of insurance commissioner, the candidate has raised at least ten thousand dollars in campaign contributions of one hundred dollars or less;

(j) For the office of state senator, the candidate has raised at least five thousand dollars in campaign contributions of one hundred dollars or less; and

(k) For the office of state representative, the candidate has raised at least five thousand dollars in campaign contributions of one hundred dollars or less.

(2) Qualifying campaign contributions under subsection (1) of this section do not include subscriptions, loans, advances, or in-kind contributions.

(3) For purposes of this section, not more than one hundred dollars of a person's total aggregate contribution may be used as a qualifying contribution in any calendar year.

(4) The commission shall issue, prior to payment of any public money, rules that detail which expenses and evidence thereof qualify as acceptable campaign expenses for purposes of this chapter.

NEW SECTION. Sec. 8. (1) Effective with elections for state offices in 1988, a candidate who has met the eligibility requirements for public matching funds and who has signed a campaign contract, shall be entitled to receive one dollar in public matching funds for each dollar received from any person in accordance with section 7 of this act to a maximum public match of one hundred dollars per individual contributor. Not more than one hundred dollars of a person's total aggregate contribution may be used as a qualifying contribution in any calendar year.

(2) The maximum amount of public campaign financing is as follows:

!tp3,2,1 Governor!w×!tj1!tc$300,000

Lieutenant governor!w×!tj1!tc$100,000

Secretary of state!w×!tj1!tc$100,000

State treasurer!w×!tj1!tc$100,000

State auditor!w×!tj1!tc$100,000

Attorney general!w×!tj1!tc$100,000

Superintendent of public instruction!w×!tj1!tc$100,000

Commissioner of public lands!w×!tj1!tc$100,000

Insurance commissioner!w×!tj1!tc$100,000

State senator!w×!tj1!tc$15,000

State representative!w×!tj1!tc$10,000

(3) If the commission determines that any payment of public funds made to an eligible candidate pursuant to this section was in excess of the aggregate amount of payments to which the candidate was entitled, the commission shall notify the candidate and the candidate shall pay to the campaign reform fund a sum equal to the amount of excess payment. No notification shall be made by the commission with respect to the payment of excess public funds more than two years after the payment of such funds.

NEW SECTION. Sec. 9. (1) To be eligible to receive payments pursuant to section 8 of this act, a candidate shall certify to the commission that:

(a) The candidate and all committees authorized by the candidate shall not incur campaign expenses in excess of the expenditure limitations imposed by section 4 of this act;

(b) The candidate has qualified to be on the election ballot in a primary, special, or general election;

(c) The candidate has filed a statement of intent to seek qualifying contributions. A contribution received before the filing of a statement of intent to seek public funds shall not be considered a qualifying contribution; and

(d) The candidate or committee authorized by the candidate has received the minimum qualifying contributions as set forth in section 7 of this act.

(2) Each candidate and all committees authorized by the candidate in receipt of qualifying campaign contributions which may be taken into account for purposes of public funding shall maintain, on a form prescribed by the commission, records which show the date and amount of each such contribution and the full name, mailing address, and occupation of the person making the contribution. The candidate and all committees authorized by the candidate shall transmit to the commission all reports with respect to such contributions which the commission may require.

NEW SECTION. Sec. 10. (1) Each candidate and political committee which receives public funds and each continuing political committee which receives public funds, shall be audited, at the expense of the candidate or committee, by a certified public accountant licensed by the state board of accountancy.

(2) The audit shall include review for compliance with applicable registration and reporting requirements of this chapter and rules of the commission in accordance with guidelines promulgated by the commission. The audit shall be completed within three months of the date of the election for which the candidacy or committee was established, except in the instance of a continuing political committee when the audit shall be completed within three months of the last day of the calendar year.

(3) A copy of the audit report shall be provided to the commission by the auditor upon its completion. The report shall be made a part of the reports of the candidate or committee.

(4) The audit shall be performed by a person other than the one, if any, which provided bookkeeping, accounting, or reporting services during the course of the campaign or calendar year.

(5) Nothing in this section precludes the commission from conducting its own audit of any candidate or political committee.

NEW SECTION. Sec. 11. (1) Application forms for public funds shall be adopted by the commission and shall provide for a sworn statement by the candidate that the candidate has established eligibility under section 9 of this act to receive payments under section 8 of this act. Each sworn statement shall include a statement or statements that the candidate has complied with the requirements for qualifying campaign contributions for the office pursuant to section 7 of this act. The statement shall be filed with the commission. Upon approval by the commission of the application and qualifying contribution statement, the commission shall distribute the appropriate amount from the campaign reform fund.

Public funds shall be distributed by the commission to each eligible candidate within ten days from the date of the initial application with the commission.

(2) Each candidate in receipt of the qualifying sum of contributions established for the office may apply to the commission for public funding no later than ten days prior to a primary, special election, or general election.

(3) The commission shall make additional certifications within two weeks after receiving an application and supplemental contribution statement from an eligible candidate who requests additional public funding.

(4) Initial certification by the commission under subsection (1) of this section and all determinations made by the commission under this section are final and conclusive, except to the extent they are subject to examination and audit by the commission under section 10 of this act.

NEW SECTION. Sec. 12. (1) Public campaign funds provided under this chapter shall only be used to:

(a) Defray campaign expenses incurred by and paid for an eligible candidate or all committees authorized by the candidate; and

(b) Repay loans, the proceeds of which were used to defray campaign expenses.

(2) No candidate or committee authorized by a candidate is entitled to receive any public funds under this chapter unless the candidate and at least one other candidate for the same office have qualified to have their names on the election ballot in the same election.

(3) In no event may any portion of the total sum of public campaign funds allowable for primary election expenditures be shifted to the total amount allowable for general election expenditures.

(4) In no event may any candidate or campaign treasurer in receipt of public campaign funds transfer any portion of such funds to another candidate.

(5) All public funds received under this chapter shall be deposited in a campaign depository as defined under RCW 42.17.020(3). Administration of all public funds received by a candidate under this chapter shall be governed by RCW 42.17.050 and 42.17.060. The commission may require such reports relating to the expenditure of such funds as it considers appropriate.

(6) Upon the filing of a final report for any primary, special, or general election, each candidate who has spent an amount below the expenditure limit set for the respective office, but who has received the maximum amount of public funds allowable for the respective office, shall return all unexpended public funds to the campaign reform fund.

NEW SECTION. Sec. 13. The campaign treasurer of the candidate shall produce evidence to the commission no later than twenty days after a primary election or general election that all public funds paid to the candidate have been utilized as required by this chapter. If the commission determines that any part of the public funds have been used for noncampaign or improper expenses, it shall report such finding to the attorney general and shall order the candidate to return all or part of the total funds paid to that candidate for a primary or general election. When such funds are returned, they shall be deposited in the campaign reform fund.

Sec. 14. Section 39, chapter 1, Laws of 1973 and RCW 42.17.390 are each amended to read as follows:

((~~(1)~~)) One or more of the following civil remedies and sanctions may be imposed by court order in addition to any other remedies provided by law:

((~~(a)~~)) (1) If the court finds that the violation of any provision of this chapter by any candidate or political committee probably affected the outcome of any election, the result of said election may be held void and a special election held within sixty days of such finding. Any action to void an election shall be commenced within one year of the date of the election in question. It is intended that this remedy be imposed freely in all appropriate cases to protect the right of the electorate to an informed and knowledgeable vote.

((~~(b)~~)) (2) If any lobbyist or sponsor of any grass roots lobbying campaign violates any of the provisions of this chapter, his registration may be revoked or suspended and he may be enjoined from receiving compensation or making expenditures for lobbying: PROVIDED, HOWEVER, That imposition of such sanction shall not excuse said lobbyist from filing statements and reports required by this chapter.

((~~(c)~~)) (3) Any person who violates any of the provisions of this chapter may be subject to a civil penalty of not more than ten thousand dollars for each such violation.

((~~(d)~~)) (4) Any person who fails to file a properly completed statement or report within the time required by this chapter may be subject to a civil penalty of ten dollars per day for each day each such delinquency continues.

((~~(e)~~)) (5) Any person who fails to report a contribution or expenditure may be subject to a civil penalty equivalent to the amount he failed to report.

(6) If any amount of any public funds made to a candidate under section 8 of this act is used for an improper purpose or a candidate violates section 4 of this act, the candidate may be subject to a civil penalty payable to the campaign reform fund in an amount up to two hundred percent of the amount of the violation.

(7) Any candidate who has received public funds under section 8 of this act and who is found to have violated any provision of sections 1 through 13 of this act may, upon court order, be required to pay to the campaign reform fund up to the full amount of public funds received by the candidate.

((~~(f)~~)) (8) The court may enjoin any person to prevent the doing of any act herein prohibited, or to compel the performance of any act required herein.

Sec. 15. Section 12, chapter 112, Laws of 1975-'76 2nd ex. sess. as amended by section 16, chapter 147, Laws of 1982 and RCW 42.17.395 are each amended to read as follows:

(1) The commission may (a) determine whether an actual violation of this chapter has occurred; and (b) issue and enforce an appropriate order following such determination.

(2) The commission, in cases where it chooses to determine whether an actual violation of this chapter has occurred, shall hold a contested case hearing pursuant to the administrative procedure act (chapter 34.04 RCW) to make such determination. Any order which the commission issues under this section shall be pursuant to such hearing.

(3) In lieu of holding a hearing or issuing an order under this section, the commission may refer the matter to the attorney general or other enforcement agency as provided in RCW 42.17.360.

(4) The person against whom an order is directed under this section shall be designated as the respondent. Such order may require the respondent to cease and desist from the activity which constitutes a violation and in addition, or alternatively, may impose one or more of the remedies provided in RCW 42.17.390((~~(1) (b), (c), (d), or (e)~~)) (2) through (7): PROVIDED, That, with respect to RCW 42.17.390(2) through (5), no individual penalty assessed by the commission may exceed two hundred fifty dollars, and in any case where multiple violations are involved in a single complaint or hearing, the maximum aggregate penalty may not exceed five hundred dollars.

(5) An order issued by the commission under this section shall be subject to judicial review under the administrative procedure act (chapter 34.04 RCW). If the commission's order is not satisfied and no petition for review is filed within thirty days as provided in RCW 34.04.130, the commission may petition a court of competent jurisdiction of any county in which a petition for review could be filed under that section, for an order of enforcement. Proceedings in connection with the commission's petition shall be in accordance with RCW 42.17.397, as now or hereafter amended.

NEW SECTION. Sec. 16. (1) Forty-five days before each primary or general election, and at such other times as may be appropriate, the commission may publish public notices in the newspaper as well as other media to communicate to the public the following:

(a) A candidate's failure to sign a contract pursuant to section 3 of this act to abide by the expenditure limits for the respective office as imposed by this chapter;

(b) A candidate who has exceeded the expenditure limits pursuant to section 4 of this act; and

(2) In publishing a public notice under this section, the commission shall endeavor to bring fair public light to the incident or violation involved.

NEW SECTION. Sec. 17. By January 1 of each even-numbered year, the commission shall submit to the legislature:

(1) A study and recommendation of reasonable campaign expenditure and contribution limits and the factors which may be relevant in their establishment; and

(2) A report concerning the status of the campaign reform fund, and shall request an appropriation if the total amount of revenues comprising the fund is insufficient to partially finance all candidates as set forth in section 8 of this act.

NEW SECTION. Sec. 18. Sections 1 through 13 and 16 and 17 of this act are each added to chapter 42.17 RCW.

NEW SECTION. Sec. 19. This act shall take effect on January 1, 1988.

NEW SECTION. Sec. 20. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.