WSR 03-22-066

PROPOSED RULES

PUBLIC DISCLOSURE COMMISSION


[ Filed November 4, 2003, 9:32 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 03-13-104.

Title of Rule: Title 390 WAC, rules relating to out-of-state or federal political committees (WAC 390-16-050 and 390-16-055), electronic filing (WAC 360-19-030), reporting of campaign expenditures (WAC 390-16-037, 390-16-041 and 390-16-205) and small contributors of twenty-five dollars or less (new rule WAC 390-17-105).

Purpose: To clarify reporting requirements for candidates and political committees.

Statutory Authority for Adoption: RCW 42.17.370.

Statute Being Implemented: Chapter 42.17 RCW.

Summary: The proposed rule amendment to WAC 390-16-050 and repeal of WAC 390-16-055 conforms to statutory provisions of HB 1294, which became effective on July 27, 2003. The proposed rule amendment to WAC 390-19-030 reflects the new statutory threshold level for electronic filing and establishes an additional benchmark for filers. The proposed amendments to WAC 390-16-037, 390-16-041 and 390-16-205 would provide clarification and examples to filers on reporting campaign expenditures. New WAC 390-17-105 implements requirements of a King County superior court permanent injunction regarding small contributors.

Reasons Supporting Proposal: The proposed amendments and new rule will clarify the statutory requirements under chapter 42.17 RCW and provide guidance to those entities required to disclose campaign contributions and expenditures.

Name of Agency Personnel Responsible for Drafting and Implementation: Doug Ellis, Public Disclosure Commission, 711 Capitol Way, Room 206, Olympia, (360) 664-2735; and Enforcement: Phil Stutzman, Public Disclosure Commission, 711 Capitol Way, Room 206, Olympia, (360) 664-8853.

Name of Proponent: [Public Disclosure Commission], governmental.

Rule is necessary because of state court decision, Washington Education Association Political Action Committee v. Public Disclosure Commission, King County Superior Court, NO. 01-2-29388-5KNT.

Explanation of Rule, its Purpose, and Anticipated Effects: The proposed rule amendments to WAC 390-16-050 and repeal of WAC 390-16-055 reflect changes to PDC Form C-5 and would eliminate the forfeiture rule. The proposed amendments would implement the provisions of HB 1294 which became effective on July 27, 2003.

Proposed amendments to WAC 390-19-030 reflect the new threshold level for mandatory electronic filing on January 1, 2004, and establishes an additional benchmark for determining when a filer can reasonably "except to expend" an amount equal to or more than $10,000.

New WAC 390-17-105 is in response to a King County superior court injunction enjoining the commission from taking action to enforce RCW 42.17.680(4) by requiring employers to disclose the names or signatures of such individuals who have made contributions in the amount of twenty-five dollars or less during the year.

Proposed amendments to WAC 390-16-037, 390-16-041 and 390-16-205 clarify the reporting requirements to provide a detailed breakdown of campaign expenditures and provides examples of how these campaign expenditures should be reported on the Public Disclosure Commission (PDC) forms.

Proposal Changes the Following Existing Rules: The proposed rule changes clarify and provide guidance to individuals, candidates and political committees on the statutory requirements of chapter 42.17 RCW.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The implementation of this rule has minimal impact small businesses.

RCW 34.05.328 does not apply to this rule adoption. The PDC is not an agency listed in subsection (5)(a)(i) of section 201. Further, the PDC does not voluntarily make section 201 applicable to this rule adoption pursuant to subsection (5)(a)(ii) of section 201, and to date JARRC has not made section 201 applicable to this rule adoption.

Hearing Location: Commission Hearing Room, Evergreen Plaza Building, 711 Capitol Way, Room 206, Olympia, WA, on December 10, 2003, at 9 a.m.

Assistance for Persons with Disabilities: Contact Ruthann Bryant by telephone (360) 753-1111.

Submit Written Comments to: Doug Ellis, Public Disclosure Commission, P.O. Box 40908, Olympia, WA 98504-0908, fax (360) 753-1112, dellis@pdc.wa.gov, by December 2, 2003.

Date of Intended Adoption: December 10, 2003.

November 3, 2003

Susan Harris

Assistant Director

OTS-6781.1


AMENDATORY SECTION(Amending WSR 96-05-001, filed 2/7/96, effective 3/9/96)

WAC 390-16-037   Purpose of campaign expenditures -- Reporting.   Any person required to report the "purpose" of an expenditure under RCW 42.17.090 (1)(f) and (l), or 42.17.100 (5)(b) shall (((1) specifically)) identify any candidate(s) or ballot proposition(s) that are supported or opposed by the expenditure unless such candidate(s) or ballot proposition(s) have been previously identified in a statement of organization of the person required to be filed under RCW 42.17.040 (2)(f) and (g), ((and))

(2) Whenever an expenditure is made to a candidate or a political committee pursuant to an agreement or understanding of any kind regarding how the recipient will use the expenditure, ((specifically)) the report shall describe in detail that agreement or understanding, and

(3) ((Specifically)) Describe in detail the goods and/or services to be provided by the recipient of the expenditure.

Example A: If an expenditure is for a get-out-the-vote campaign, the purpose shall include the following details:

Vendor Name Purpose Amount
XYZ Consulting GOTV -- phone bank 28th and 29th Legislative districts $1,000

Example B: If an expenditure is for printing, the purpose shall include the following details:

Vendor Name Purpose Amount
ABC Printing 5,000 brochures $3,000

Example C: If an expenditure is for broadcast political advertisements, the purpose shall include the following details:

Vendor Name Purpose Amount
Media King Television ads $50,000
WZUB TV $30,000
WXXX TV $10,000
WCRB TV $10,000

[Statutory Authority: RCW 42.17.370(1). 96-05-001, 390-16-037, filed 2/7/96, effective 3/9/96; 82-05-001 (Order 82-01), 390-16-037, filed 2/4/82.]


AMENDATORY SECTION(Amending WSR 02-01-014, filed 12/7/01, effective 1/7/02)

WAC 390-16-041   Forms -- Summary of total contributions and expenditures.   (1) The official form for reports of contributions and expenditures by candidates and political committees who use the "full" reporting option is designated "C-4," revised 1/02, and includes Schedule A, revised ((11/93)) 1/04, Schedule B, revised ((1/02)) 1/04, Schedule C, revised 3/93, and Schedule L, revised 1/02.

(2) Copies of these forms are available at the Commission Office, 711 Capitol Way, Room 206, P.O. Box 40908, Olympia, Washington 98504-0908. Any paper attachments shall be on 8-1/2" x 11" white paper.

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[Statutory Authority: RCW 42.17.370(1). 02-01-014, 390-16-041, filed 12/7/01, effective 1/7/02; 99-22-082, 390-16-041, filed 11/2/99, effective 12/3/99. Statutory Authority: RCW 42.17.370(1) and 42.17.090 (1)(k). 97-06-085, 390-16-041, filed 3/3/97, effective 4/3/97. Statutory Authority: RCW 42.17.390. 94-05-011, 390-16-041, filed 2/3/94, effective 3/6/94. Statutory Authority: RCW 42.17.370. 93-09-002, 390-16-041, filed 4/8/93, effective 5/9/93; 92-18-002, 390-16-041, filed 8/20/92, effective 9/20/92; 92-05-080, 390-16-041, filed 2/18/92, effective 3/20/92; 91-22-033, 390-16-041, filed 10/30/91, effective 11/30/91; 90-16-083, 390-16-041, filed 7/31/90, effective 8/31/90; 89-20-068, 390-16-041, filed 10/4/89, effective 11/4/89. Statutory Authority: RCW 42.17.370(1). 86-08-030 (Order 86-02), 390-16-041, filed 3/26/86; 86-04-071 (Order 86-01), 390-16-041, filed 2/5/86; 84-05-018 (Order 84-01), 390-16-041, filed 2/10/84; 82-11-026 (Order 82-03), 390-16-041, filed 5/10/82; 82-02-007 (Order 81-04), 390-16-041, filed 12/28/81; Order 91, 390-16-041, filed 7/22/77; Order 62, 390-16-041, filed 8/26/75; Order 60, 390-16-041, filed 7/16/75.]


AMENDATORY SECTION(Amending WSR 02-12-007, filed 5/23/02, effective 6/23/02)

WAC 390-16-050   Forms for contributions and expenditures of out-of-state ((or federal)) political committees.   The official form for the report required by RCW 42.17.093 of contributions and expenditures of an out-of-state political committee((s (a) registered with the Federal Election Commission, (b) not domiciled in Washington state, or (c) otherwise not required to report under RCW 42.17.040, 42.17.065, or 42.17.080)) organized for the purpose of supporting or opposing candidates or ballot propositions in another state that is not otherwise required to report under RCW 42.17.040 through 42.17.090 is designated "C-5," revised ((6/02)) 1/04. Copies of this form are available at the Commission Office, Room 206, Evergreen Plaza Building, Olympia, Washington 98504-0908. Any paper attachments shall be on 8 1/2" x 11" white paper.

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[Statutory Authority: RCW 42.17.370(1). 02-12-007, 390-16-050, filed 5/23/02, effective 6/23/02; 02-03-018, 390-16-050, filed 1/4/02, effective 2/4/02. Statutory Authority: RCW 42.17.390. 94-05-011, 390-16-050, filed 2/3/94 effective 3/6/94. Statutory Authority: RCW 42.17.370. 89-20-068, 390-16-050, filed 10/4/89, effective 11/4/89. Statutory Authority: RCW 42.17.370(1). 86-04-071 (Order 86-01), 390-16-050, filed 2/5/86; 82-11-026 (Order 82-03), 390-16-050, filed 5/10/82; Order 77, 390-16-050, filed 6/2/76; Order 62, 390-16-050, filed 8/26/75; Order 6, 390-16-050, filed 3/23/73.]


AMENDATORY SECTION(Amending Order 74, filed 4/26/76)

WAC 390-16-205   Expenditures by agents, employees -- Reporting.   Expenditures made on behalf of a candidate or political committee by any person, agency, firm, organization, etc. employed or retained for the purpose of organizing, directing, managing or assisting the candidate's or committee's efforts shall be deemed expenditures by the candidate or committee. In accordance with WAC 390-16-037, such expenditures shall be reported by the candidate or committee as if made or incurred by the candidate or committee directly.

Example A: If a campaign committee pays a consultant $5,000 to prepare and mail a political advertising brochure, all costs associated with the project shall be itemized by identifying each service provided, vendor utilized and amount attributable to each:

Vendor Name Purpose Amount
Jones Consulting $5,000
ABC Graphics $1,200
XYZ Printing Co. (5,000 pieces) $3,000
Your Mailhouse $800

Or, if Jones Consulting completes the project through a combination of services provided by its principals or employees and subcontractors:

Vendor Name Purpose Amount
Jones Consulting $5,000
Graphic design $1,200
XYZ Printing Co. (5,000 pieces) $3,000
Your Mailhouse $800

Example B: If a campaign committee pays a consultant to perform tasks such as fund-raising, survey design or campaign plan development, and the consultant does not subcontract with other vendors, the expense shall be reported as follows:

Vendor Name Purpose Amount
Jones Consulting Fund-raising, survey design campaign plan development $5,000

[Order 74, 390-16-205, filed 4/26/76.]

OTS-6782.1


NEW SECTION
WAC 390-17-105   Small contributors of twenty-five dollars or less.   (1) To comply with RCW 42.17.680(4), each person or entity who withholds contributions of individuals shall, in lieu of disclosing the names and signatures, substitute unique numerical identifiers for persons making contributions in the amount of twenty-five dollars or less during a calendar or fiscal year on the signed withholding authorization form or on other documents (such as payroll deductions) subject to RCW 42.17.680(4).

(2) Contribution withholding authorization forms or payroll deduction documentation of contributors whose annual aggregate contribution is twenty-five dollars or less during any calendar or fiscal year are not required by the commission to be made available for public inspection or copying when such records display the names, signatures, home addresses, Social Security numbers, or other information capable of personally identifying contributors whose annual aggregate contribution is twenty-five dollars or less during any calendar or fiscal year.

(3) The names, signatures, home addresses, Social Security numbers or other information capable of personally identifying contributors whose annual aggregate contribution to a person or entity is twenty-five dollars or less during any calendar or fiscal year shall not be provided by the commission to the public or made available for public inspection or copying.

(4) Each person or entity who withholds contributions under RCW 42.17.680 shall, upon request, deliver to the commission documents of books and accounts described in RCW 42.17.680(4).

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OTS-6783.1


AMENDATORY SECTION(Amending WSR 01-22-052, filed 10/31/01, effective 1/1/02)

WAC 390-19-030   Electronic filing -- Reporting threshold.   (1) ((Beginning with the reporting periods that start on or after January 1, 2002,)) The "electronic reporting threshold" that requires electronic filing of all contribution and expenditure reports is met when a candidate or political committee has expended (($25,000)) $10,000 or more in the preceding calendar year or expects to expend (($25,000)) $10,000 or more in the current calendar year. ((The electronic reporting threshold is $10,000 effective January 1, 2004.))

(2) It is presumed that a filer "expects to expend" ((is defined as)) $10,000 or more when any one of the following first occurs:

(a) A filer ((meets or exceeds the electronic reporting threshold)) spends at least $10,000;

(b) A filer(('s expenditures during the last election)) is a candidate for the same office sought ((met or exceeded the electronic reporting threshold)), the filer's election is in the current calendar year, and his or her campaign expenditures in the previous election for the same office were $10,000 or more;

(c) A filer's expenditures meet or exceed ((one-quarter of the electronic reporting threshold in the first calendar quarter)) $2,500 on or before March 31 of the current calendar year;

(d) A filer's expenditures meet or exceed ((one-half of the electronic reporting threshold in the first half)) $5,000 on or before June 30 of the current calendar year; ((or))

(e) A filer's expenditures meet or exceed $7,500 on or before September 30 of the current calendar year; or

(f) A filer otherwise projects that ((the electronic reporting threshold will be met)) $10,000 or more will be spent during the current calendar year.

(3) The following expenditures or transactions are excluded from the electronic reporting threshold calculation:

(a) Expenditures made to pay outstanding debts carried forward from a previous election; and

(b) Surplus funds disposed of in accordance with RCW 42.17.095.

(4) Candidate committees or political committees supporting or opposing ballot propositions that meet, exceed or expect to meet or exceed the electronic reporting threshold shall report electronically for the duration of the campaign.

(5) ((Beginning with the reporting periods that start on or after January 1, 2002,)) A report that is filed with the commission electronically need not also be filed with the county auditor or elections officer pursuant to RCW 42.17.080.

[Statutory Authority: RCW 42.17.370. 01-22-052, 390-19-030, filed 10/31/01, effective 1/1/02.]


REPEALER

     The following section of the Washington Administrative Code is repealed:
WAC 390-16-055 Filing reports for nonreporting committees

Legislature Code Reviser 

Register

Washington State Code Reviser's Office