HOUSE BILL REPORT
HB 1910
BYRepresentatives R. Fisher, Miller, Hine, Van Luven, McLean, H. Sommers, Anderson, Braddock, Belcher, Dellwo, Baugher, Basich, Leonard, Rust, Scott, Pruitt, Nelson, Winsley, Morris, Phillips, Raiter, G. Fisher, Sprenkle and Brekke
Providing limitations on campaign contributions, voluntary limitations on campaign spending and partial public financing of campaigns.
House Committe on State Government
Majority Report: The substitute bill be substituted therefor and the substitute bill do pass. (8)
Signed by Representatives R. Fisher, Chair; Anderson, Vice Chair; McLean, Ranking Republican Member; R. King, Morris, O'Brien, Rector and Sayan.
Minority Report: Do not pass. (2)
Signed by Representatives Hankins and Silver.
House Staff:Kenneth Hirst (786-7105)
Rereferred House Committee on Revenue
Majority Report: The substitute bill by Committee on State Government be substituted therefor and the substitute bill do pass. (10)
Signed by Representatives Wang, Chair; Pruitt, Vice Chair; Appelwick, Basich, Fraser, Grant, Morris, Rust, H. Sommers and Van Luven.
Minority Report: Do not pass. (4)
Signed by Representatives Holland, Ranking Republican Member; Brumsickle, Haugen and Phillips.
House Staff: Rick Wickman (786-7136)
AS REPORTED BY COMMITTEE ON REVENUE MARCH 4, 1989
BACKGROUND:
In 1972, the voters approved Initiative Measure No. 276 regarding public disclosure. One section of the initiative established mandatory expenditure limits on campaigns for elective office. In 1974, the state's Supreme Court found that section to be unconstitutional.
A series of federal court cases has identified a number of constitutional limitations on the regulation of campaign financing. Certain constitutionally permissible restrictions on such financing have also been identified in those decisions. In those cases, the courts found the following to be permissible: (1) limitations on contributions by individuals or organizations to candidates for federal office; (2) limitations on contributions by individuals or organizations to political action committees; (3) limitations on contributions by political action committees to candidates for federal office; (4) limitations on total contributions by individuals in a calendar year to candidates for federal office; (5) public financing for presidential elections; and (6) federal public disclosure requirements.
Found to be impermissible were ceilings on candidate expenditures or on "independent expenditures" (that is, campaign expenditures not subject to the control of a candidate). Upheld, however, were ceilings on candidate expenditures which become effective only as part of a public financing agreement under which a candidate agrees to abide by the limits in exchange for public financing. Also found to be impermissible were any ceilings on contributions or expenditures in ballot proposition campaigns.
SUMMARY:
SUBSTITUTE BILL: A system is established for providing public matching funds for the election campaigns of candidates for state executive and legislative offices. The matching monies are available to candidates who agree to abide by specified campaign expenditure limits and other restrictions in exchange for the public matching funds.
Restrictions are established on the size of the contributions that may be given to a candidate for state executive or legislative office.
I. CAMPAIGN EXPENDITURE LIMITS & MATCHING FUNDS
Expenditure Limits. The expenditure limits are expressed as base amounts for each office. The base amounts of the expenditure limits are:
!tm8,8,1,8 !tlCandidates for!tj2!trBase Amount
!tlGovernor!tj1!tr=!tr$2,000,000
!tlOther State Executive Office!tj1!tr=!tr$ 750,000
!tlState Legislative Office!tj1!tr=!tr$ 40,000
These limits apply to the aggregate of all expenditures made by a candidate during the election cycle for the office sought. In general, the election cycle is the period beginning December 1st following the last general election held for the office and ending November 30th following the next election for the office. To be eligible to receive public matching funds, a candidate must file with the Public Disclosure Commission an agreement binding the candidate to the applicable expenditure limit by the third business day after receiving contributions during the election cycle of: $25,000 for candidates for Governor; $7,500 for other state executive office; and $2,500 for state legislative office.
Increases Over Base Amounts. If, during the 12 months preceding the election, certain independent expenditures are made in opposition to a candidate or for another candidate for the office sought by the candidate, the expenditure limit for the candidate (not the other candidate) is increased by an amount equal to the amount of the independent expenditures. This increase applies only if the independent expenditures, in the aggregate, total more than 10 percent of the base amount for the office. A person making such independent expenditures must file special reports with the Public Disclosure Commission if the expenditures equal, in the aggregate, $500 or more.
A candidate for an office is not subject to an expenditure limit if, during the election cycle, any other candidate for the office receives contributions which would require that other candidate to file an agreement with the Commission within three days to be eligible to receive public matching funds but that other candidate has not filed such an agreement in a timely manner.
Matching Monies. A State Election Campaign Account is established. The Commission is authorized to make payments of matching monies from the Account to eligible candidates. Generally, the maximum amount that a candidate may receive from the Account is:
!tm8,8,1,8 !tlCandidates for!tj2!tcMatching Monies
!tlGovernor!tj1!tr=!tr$200,000
!tlOther State Executive Office!tj1!tr=!tr$ 60,000
!tlState Legislative Office!tj1!tr=!tr$ 20,000
If a candidate is not subject to an expenditure limit, the maximum amount that the candidate may receive from the Account is doubled.
Matching Formula. Subject to these maximum amounts, an eligible candidate is entitled to payments from the Account equal to: one dollar for each dollar in "qualifying" contributions received by candidate for the election campaign; or two dollars for each such dollar raised by candidate if the candidate is not subject to an expenditure limit. If the candidate's expenditure limit is increased as a result of independent expenditures, the candidate is entitled to payments from the State Campaign Account equal to those independent expenditures (the maximum amount that the candidate may receive from the Account is also increased by an amount equal to those expenditures).
To receive matching monies, a candidate must have received "qualifying" contributions in a "threshold" amount of at least:
!tm8,8,1,8 !tlCandidates for!tj2!tcQualifying Dollars
!tlGovernor!tj1!tr=!tr$ 25,000
!tlOther State Executive Office!tj1!tr=!tr$ 7,500
!tlState Legislative Office!tj1!tr=!tr$ 2,500
"Qualifying" Contribution Restrictions. For a contribution received by a candidate to qualify as being one which may be counted toward this "threshold" amount or to qualify to be matched by public monies from the Account, the contribution: must be a gift of money made by a written instrument identifying the individual making the contribution; must be contributed directly to the candidate or the candidate's authorized committee (certain joint fund-raising activities are exempted from this); must be raised during the election cycle; and must be from an individual. The contribution must not have come from a candidate for any office. A limit is established on the total amount of the contributions to a candidate from one individual that may be matched or may be counted toward the minimum threshold amount. The limit is $1,000 to a candidate for Governor, $500 to a candidate for any other state executive office, and $200 to a candidate for state legislative office. Contributions by a person controlled by another person are credited to the controlling person.
Other Restrictions. A candidate may not receive matching monies from the Account for a campaign for an office unless one other candidate for that office has received contributions of any kind during the election cycle which in the aggregate exceed the "threshold" amount.
A candidate who receives a payment from the Account may not, during the election cycle, spend or receive as loans for his or her own campaign personal funds or the funds of a member of the candidate's immediate family which in the aggregate are more than: $30,000 for the office of Governor; $10,000 for other state executive office; or $2,000 for state legislative office. A candidate who submits an expenditure limitation agreement must also agree to comply with the Fair Campaign Practices Code.
Funding. The Lottery Commission must offer, once each calendar year, an instant scratch-off game for providing funds for the State Campaign Account. The game must be structured with the goal of depositing in the Account (after prizes and administrative costs) an amount determined by the Public Disclosure Commission to be needed to provide matching monies for election campaigns. Monies in the Account are subject to legislative appropriation.
Candidates' Pamphlet. The Secretary of State must add notices in the state's official Candidates' Pamphlet identifying those candidates who have filed agreements with the Public Disclosure Commission to limit their campaign expenditures.
Administration. The matching fund program is administered by the Public Disclosure Commission. The Commission or its Executive Director must respond to applications for matching funds within two business days. Decisions regarding such applications are not subject to the provisions of the Administrative Procedures Act. In an appeal regarding a response to such an application, the decision of the superior court is final. The Commission must conduct certain audits and must report to the Governor and the Legislature regarding the matching fund program after each election.
II. CAMPAIGN CONTRIBUTION LIMITATIONS
Limitations are established on the aggregate size of the campaign contributions that may be made by a person or entity to a candidate for state executive or legislative office. The limits are:
!tm6,9,9,1 To Candidate For!tj1!tlFrom!tj1!trLimit
State Executive!tj1!tlPolitical Party or Caucus
Office!tj1!tl of State Legislature!tj1!tr= $10,000
!tj1!tlMulti-candidate
!tj1!tl Political Committee!tj1!tr= $ 7,500
!tj1!tlAny Other Entity!tj1!tr= $ 5,000
State Legislator!tj1!tlPolitical Party or Caucus
!tj1!tl of State Legislature!tj1!tr= $ 5,000
!tj1!tlMulti-candidate
!tj1!tl Political Committee!tj1!tr = $ 3,000
!tj1!tlAny Other Entity!tj1!tr= $ 2,000
These limits also apply to contributions to an official holding such an office who is the object of a recall campaign and to contributions to a political committee expecting to make expenditures supporting the recall of such an elected official.
For an election campaign, the limits apply during the election cycle. For a recall campaign, the limits apply from the date of the filing of recall charges and until 30 days after the recall election. Special rules are established for contributions which are earmarked or otherwise directed through an intermediary to a candidate.
Contributions During Legislative Sessions. No state legislator may, during the course of a Regular Session, accept a campaign contribution for a state legislative office from any person. This restriction does not apply to a legislator during a recall campaign against the legislator.
Entities Controlled By Others. Contributions by an entity which is controlled by another person are considered to have been made by the other person. This provision does not apply to the relationship between spouses or between certain units of political parties. Special rules apply to contributions made by minors.
III. OTHER PROVISIONS
Special Elections. Although the restrictions on contributions and the expenditure limitation/public matching program apply to campaigns for special elections to fill vacancies, the expenditures and contributions made for the special elections are not counted toward any of the limitations which apply to other elections.
Contributions received up to one year after an election are considered to be contributions for the election cycle ending with that election if they are used to pay any debt or obligation incurred to influence the outcome of that election. Independent expenditures are considered to be expenditures by a candidate if they were encouraged by the candidate or made with the candidate's approval or the person making the expenditures collaborated with the candidate.
Penalties. Civil penalties are established for violations of various provisions concerning the expenditure limitation and matching fund program and for violations of the contribution limitations.
SUBSTITUTE BILL COMPARED TO ORIGINAL: The substitute bill: more clearly defines the expenditures which are to be considered as "independent expenditures"; expands the definition of "immediate family" to include grandchildren and stepparents; deletes a provision of the original bill which requires that a candidate who signs an agreement to limit expenditures also certify that he or she will file as a candidate for an office; counts an independent expenditure as being an expenditure by a candidate in certain circumstances involving encouragement, approval, or collaboration by the candidate; permits the Commission to delay by rule authority to its Executive Director to make disbursements of matching monies; reinstate a provision of current law which limits the size of contributions made within 21 days of an election; and changes the effective date of certain provisions from January 1, 1990 to July 1, 1990.
CHANGES PROPOSED BY COMMITTEE ON REVENUE: None.
Revenue: The bill has a revenue impact.
Fiscal Note: Requested February 15, 1989.
Effective Date:The bill contains an emergency clause. The provisions limiting campaign contributions and providing for the Lottery Commission's scratch-off game take effect immediately. The remaining provisions take effect July 1, 1990.
House Committee ‑ Testified For: (State Government) Norman Turrill and Chuck Sauvage, Common Cause; Ruth Coffin Schroeder, League of Women Voters of Washington; Sarah McCoy, SANE FREEZE; Phil Kaplan, Washington Poverty Law Advocates; David Bockmann, Washington Fair Share; and Tony Lee, Washington Association of Churches.
(Revenue) Chuck Sauvage, Common Cause.
House Committee - Testified Against: (State Government) None Presented.
(Revenue) None Presented.
House Committee - Testimony For: (State Government) (1) Some members of the public have the impression that large contributions to election campaigns influence the decisions of the recipients. (2) As costs have risen for campaigns, the portion of contributions coming from businesses has gone up and the portion coming from individuals has gone down. (3) The Legislature should take actions which tie candidates more closely to voters. (4) Partial public financing of campaigns is essential for valid expenditure limits; other inducements are not sufficient.
(Revenue) Campaign contributions and expenditures for conducting campaigns should be limited.
House Committee - Testimony Against: (State Government) None Presented.
(Revenue) None Presented.