HOUSE BILL REPORT

EHB 1154

BYRepresentatives R. Fisher, McLean, Anderson, R. King, Rector, O'Brien, Sayan, Morris, Silver, Hankins, G. Fisher, Winsley, Valle, Beck, Brekke, Horn, Phillips, Miller, Ebersole and Wineberry; by request of Public Disclosure Commission

Revising campaign finance reporting.

House Committe on State Government

Majority Report:  Do pass with amendment.  (7)

      Signed by Representatives R. Fisher, Chair; Anderson, Vice Chair; McLean, Ranking Republican Member; Hankins, R. King, Rector and Sayan.

House Staff:Kenneth Hirst (786-7105)

AS PASSED HOUSE MARCH 15, 1989

BACKGROUND:

The public disclosure laws require political committees to file statements of organization with the Public Disclosure Commission and require candidates and political committees to file reports regarding contributions received and expenditures made.  These laws identify items that are to be and are not to be considered as contributions and expenditures for the purposes of the reports.  Persons who make certain independent expenditures must also file reports with the Commission.

Special reports must also be filed concerning a contribution received within seven days before a primary or within 21 days before an election if the contribution is more than $500 and is from one person or entity.  The public disclosure laws also limit the size of the contributions that may be made or received within 21 days of an election.

SUMMARY:

The definitions of "contribution" and "expenditure" are altered for the purposes of the public disclosure statutes.  The incidental expenses that may be incurred by a volunteer whose services are not considered to be a contribution are increased to $50 (from $25) and the volunteer services which are not considered to be contributions are altered.  The payment of service charges against the campaign account of a political committee is no longer exempted from being considered an expenditure.

A political committee organized within the last three weeks before a primary or election which expects to participate in the primary or election campaign must file a statement of organization with the Public Disclosure Commission within three days after its organization or when it first has the expectation of receiving contributions or making expenditures in the campaign.

A continuing political committee making a contribution concerning a candidate or ballot proposition within 60 days of the date of the primary or election involved must file on the same dates as are required for other political committees.

CANDIDATE AND COMMITTEE REPORTS.  Provisions of the public disclosure laws regarding the reports of contributions and expenditures that must be filed by candidates and political committees are altered.  The report which is currently due within 21 days after a primary or election is now due on the 10th day of the first month following the primary or election.  Rather than containing expenditures made and contributions received as of five days prior to the date of the report, the report filed 21 days before a primary or election must be current as of the fifth business day before the date of the report, the report due seven days before a primary or election must be current as of the end of the business day before the date of the report, and the report due on the 10th of the month following the primary or election must be current as of the last day of the month of the primary or election.

CONTRIBUTIONS.  The names and addresses of persons contributing $25 or less (rather than those contributing less than $25) need not be included in such a report.  Pledges aggregating less than $100 from any one person need not be reported.

Funds received from an otherwise "nonreporting committee" may not avoid being forfeited to the state as the result of the recipient's filing the necessary disclosure report required of such a committee.  The "nonreporting committee" must file the required report within 10 days of the date the funds are received or the funds are forfeited to the state.  The content of the report is also altered.

EARMARKED CONTRIBUTION.  The intermediary who receives an earmarked contribution must send a special report regarding the contribution to the commission and to the person for whom it was earmarked.  The latter person is no longer required to record the receipt of such an earmarked contribution in a special category in the person's reports that are routinely filed with the commission.

EXPENDITURES.  An expenditure must be reported under one of the following categories in reports filed with the commission:  expenditures for the election of the candidate; expenditures for non-reimbursed public office related expenses; transfers of funds; or expenditures of surplus funds or other expenditures.

The names and addresses of persons to whom more than $50 in the aggregate was expended during the period covered by the report (rather than $50 or more in total) must be reported.  The name and address of any person to whom any debt or liability was owed in an amount of more than $250 or in an amount of more than $50 which has been outstanding for more than 30 days must be reported as must the amount of the debt or liability.

INDEPENDENT EXPENDITURES.  Reports required for independent expenditures must be filed on the same dates as required for candidates and political committees.  A report must list the name and address of each person to whom expenditures of more than $50 (rather than $25 or more) in the aggregate were made.

CONTRIBUTION LIMIT WITHIN 21 DAYS OF ELECTION.  An exemption from the provision of the public disclosure law limiting the size of contributions within 21 days of a general election which currently applies to contributions from a major political party is applied instead to contributions from a major Washington state political party.

PUBLIC OFFICE FUNDS.  The reports regarding Public Office Funds which must, under current law, be filed with the commission annually must now be filed quarterly.

Fiscal Note:      No Impact.

Effective Date:The bill takes effect on January 1, 1990.

House Committee ‑ Testified For:    Graham Johnson and Ruth Beck, Public Disclosure Commission; and Dean Williams, Snohomish County Auditor.

House Committee - Testified Against:      None Presented.

House Committee - Testimony For:    (1) The purpose of the bill is to reduce the recordkeeping problems experienced by campaign treasurers.  They are generally not certified public accountants and would appreciate the simplification of reporting requirements.  (2) One of the objectives of the disclosure statutes is to encourage small contributions by exempting them from being itemized in reports filed with the Commission.  The elevated reporting levels established for exemptions by the bill are still "small" by today's standards.  (3) The current reporting requirements for fundraisers are too cumbersome to be used for small-scale efforts. The bill provides a special, easier-to-use report for those small "fun" raisers.  (4) Tracking the flow of earmarked contributions is one of the major problems addressed by this bill.

House Committee - Testimony Against:      None Presented.