SENATE BILL REPORT

ESB 6045

BYSenators Smith, Hayner, Amondson, Rasmussen, Anderson, Nelson, Owen, Thorsness, Craswell, Metcalf, McDonald, West and Barr

Reforming campaign finance and reporting provisions.

Senate Committee on Governmental Operations

Senate Hearing Date(s):February 27, 1989; March 1, 1989

Majority Report:  Do pass.

      Signed by McCaslin, Chairman; Thorsness, Vice Chairman; Conner.

Senate Staff:Barbara Howard (786-7410); Eugene Green (786-7405)

                  March 20, 1989

AS PASSED SENATE, MARCH 15, 1989

BACKGROUND:

Passage of Initiative 276 (the Public Disclosure Act) in 1972 signaled the first major reform in public disclosure and limits on campaign financing in many years.  In 1974, the Congress adopted significant amendments to the Federal Election Campaign Act of 1971.  Other states have revised their campaign finance laws since, emphasizing greater limits on contributions and expenditures as well as enhancement of reporting requirements.

SUMMARY:

Legislative intent is specifically amended to include the concept that dealings with elected officials should be free from bias caused by large corporate and organizational contributions.

In the campaign financing provisions of the Public Disclosure Act, the definitions sections contain a number of significant revisions in key terms, including "caucus," "contributions," "earmarked," "election cycle," "expenditure," and "political action committee."

Limits on Receipt and Use of Contributions by Candidates.  For the period beginning 15 days prior to a legislative session through 30 days after adjournment, no fundraising events may be held for any state or federal campaign, except for an individual's own district constituents.  No contributions may be given or accepted during this period.  The prohibition does not apply to special sessions after the close of a filing period for a legislative office.

Political action committees may only accept contributions from individuals, with the same limits as for other individual contributions.  No legislative caucus may form more than one continuing political committee.

No candidate's committee may transfer funds to any candidate or political committee other than for the election of the candidate to the office listed.  After a campaign, surplus funds may only be brought forward to a future campaign for the same office.  When an incumbent leaves office, funds may be returned to donors or given to charitable organizations, the state treasury or to a state political party.

Candidates and political committees must report expenditures, as well as contributions.  Campaign funds may not be earmarked to a caucus, party or candidate.

Contribution Limitations.  Major political parties are prohibited from making contributions for statewide offices in excess of $50,000 in the last 21 days before a general election.  A similar prohibition is imposed on major political parties or caucus committees for legislative candidates in excess of $25,000.  No legislative caucus may form more than one continuing political committee.

Corporations and labor organizations and associations may not contribute to either individual candidates, the legislative caucus committees or political parties.  Such organizations are also prohibited from providing an increase in salary or other emoluments to employees for the purpose of campaign activities.  Discrimination by a corporation or labor organization against an officer or employee for failure to make a political contribution is a gross misdemeanor, with a civil penalty up to $5,000.

Mailings of more than 1,000 identical or nearly identical pieces by state legislators up for election during the calendar year of the election constitute a misuse of public office.  Individuals may contribute up to $2,500 to any candidate during an election year and up to $2,500 to any caucus or political action committee in a calendar year.  The maximum contribution to political parties is $5,000 per year.

Political parties may not contribute in the aggregate of more than $250,000 to a candidate for statewide office.  Legislative caucuses may not contribute in the aggregate of more than $25,000 to candidates for the state Senate or House of Representatives.  Political action committees may contribute only $100 each calendar year to candidates, caucuses, political parties, or committees for or against ballot propositions.  Out-of-state contributions to candidates, caucus committees and in support of or opposition to ballot propositions are limited to $500 in any election cycle.

The Public Disclosure Commission may adjust upward dollar amounts of contributions and expenditures by an amount determined every other January.  The new limits may be set in specific dollar amounts, rounded to the nearest $10.

Other Provisions.  Contributions in excess of $2,500 may not be used to repay a candidate's loans to his or her own campaign.  All loan repayments must comply with the limits imposed for the election period in which the loan was made.

Candidates must report all contributions in excess of $10.  State employees may no longer request payroll deductions for political committees.

The provisions for legislative districts are revised to require a separate district for each member of the House of Representatives (within a senatorial district).  The districts are designated by "A" or "B."  No representative district may dilute the voting strength of community interests, which are enumerated.

The act is known as the "Fair Campaign Practices Act."

The measure is subject to referendum.

A section requiring reporting of earmarked contributions is repealed.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: Chuck Sauvage, Common Cause (pro); Mark Brown, WFSE (con); Bob Maier; WEA (con)