Report Title:

Elections; Comprehensive Public Funding

Description:

Establishes a comprehensive public funding program for state house of representatives candidates who agree to abide by campaign contribution and expenditure limits and meet other criteria.(HB2070 HD1)

HOUSE OF REPRESENTATIVES

H.B. NO.

2070

TWENTY-SECOND LEGISLATURE, 2004

H.D. 1

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to elections.

 

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

SECTION 1. The legislature finds that there is consensus regarding the need for the reform of funding public elections in Hawaii. Many citizens agree that:

(1) There is a growing sense of cynicism and frustration among the voting public because of the practices of soliciting, raising, and spending large private campaign contributions by candidates and elected officials;

(2) Such practices create the perception of undue influence on candidates or elected officials by moneyed private interests;

(3) Reliance on private contributions makes it difficult for individuals without access to large private contributions to participate meaningfully in the electoral process.

The purpose of this Act is to provide comprehensive public funding for candidates seeking election to office in the state house of representatives who voluntarily agree to abide by campaign contribution and expenditure limits and meet other criteria spelled out in the Act.

SECTION 2. Chapter 11, Hawaii Revised Statutes, is amended by adding a new subpart C to part XII and to read as follows:

"C. Comprehensive Public Funding for

House of Representatives Elections

§11-A Definitions. When used in this subpart, unless the context clearly requires otherwise:

"Candidate" means an individual who seeks nomination for or election to the state house of representatives and who meets the criteria of section 11-191, and includes any candidate who receives comprehensive public funding under this subpart.

"Candidate's committee" means a committee, as defined in section 191, that makes an expenditure or accepts a contribution on behalf of a candidate, as defined in this section, with the candidate's authorization.

"Certification for comprehensive public funding" means the decision by the commission that a candidate is certified to receive public funding in accordance with this subpart.

"Commission" shall be as defined in section 11-191.

"Committee" shall be as defined in section 11-191.

"Comprehensive publicly funded candidate" means a candidate who is certified by the commission as eligible for comprehensive public funding under this subpart and who agrees to abide by the provisions under this subpart.

"Contribution" shall be as defined in section 11-191, except for qualifying contributions.

"District" means the state house of representative districts as established in accordance with the Hawaii State Constitution, Art. III, Section 3.

"Declaration of intent to seek comprehensive public funding" means the form completed by a candidate who intends to seek public funding under this subpart and the filing of which triggers the end of the candidate's ability to spend seed money and permits the candidate to begin collecting qualifying contributions.

"Election period" means the two-year period between general election days for a candidate seeking nomination for or election to the state house of representatives.

"Equalizing funds" means supplemental public funds released by the commission to a comprehensive publicly funded candidate to allow the candidate to stay financially competitive with a privately funded opponent.

"Excess expenditure" means the amount of comprehensive public funds spent or obligated to be spent by a comprehensive publicly funded candidate in excess of one hundred per cent of the allocated funds for a primary election, general election, or both.

"Expenditure" shall be as defined in section 11-191.

"General election campaign period" means the period beginning the day after the primary election and ending two weeks after a general election.

"General election year" means the period commencing January 1 of an even numbered year in which a general election is held and ending two weeks after the general election.

"Hawaii election campaign fund" shall be as defined in section 11-217.

"Immediate family" shall be as defined in section 11-191.

"Independent expenditure" means an expenditure by a person for a communication that expressly advocates the election or defeat of a clearly identified candidate and that is not made in concert or cooperation with or as part of any coordinated activity or at the request or suggestion of the candidate, the candidate's authorized committee, or their agents, or a political party committee or its agents. For purposes of this definition, the term "clearly identified" means that the name of the candidate is used, or a photograph or drawing of the candidate appears, or the identity of the candidate is apparent by unambiguous reference.

"Individual" shall be as defined in section 11-191.

"Loan" shall be as defined in section 11-191.

"Noncandidate committee" shall be as defined in section 11-191.

"Party" shall be as defined in section 11-191.

"Person" shall be as defined in section 11-191.

"Petty cash expenditure" means a single item of expense of not more than $25 paid in cash.

"Primary election campaign period" means the period beginning January 1 in the year of the primary election and ending two weeks after the primary election.

"Privately funded candidate" means any candidate for the state house of representatives who does not qualify for or receive public funding during an election period.

"Public funding" or "public funds" means campaign funds from the Hawaii election campaign fund received by an eligible candidate pursuant to subpart B or this subpart.

"Qualifying contribution" means a $3 monetary contribution made to a candidate that meets the criteria of section 11-F.

"Qualifying period" means the period beginning January 1 of a general election year and ending on the deadline for filing candidate nomination papers in accordance with section 12-6, Hawaii Revised Statutes, to run in the primary election during which a candidate may collect qualifying contributions to qualify for comprehensive public funding under this subpart; provided the commission has determined that the Hawaii election campaign fund has sufficient funds to make payments to comprehensive publicly funded candidates during the election period.

"Seed money" means contributions made to a candidate by a person in accordance with section 11-D that may be expended solely for the purpose of determining campaign viability.

"Surplus campaign funds" means any money given to a candidate, before the candidate is certified for comprehensive public funding, that was not spent during the election period for which the contributions were made.

Except for terms that are specifically defined in this subpart, terms that are defined under subpart B shall apply to this subpart.

§11-B Sufficiency of funding for comprehensive public funding for state house of representatives elections. No later than on September 1 of each odd-numbered year before a general election year, the commission shall determine whether there are sufficient funds in the Hawaii election campaign fund to finance at least two state house of representatives candidates for each representative district under this subpart.

If the commission determines that there is sufficient funding, then within five business days, the commission shall publish notice statewide, pursuant to section 1-28.5, that the provisions of the comprehensive public funding for state house of representatives elections shall become effective on January 1 of the following general election year. If there is not sufficient funding, then this subpart shall be inoperative for the general election year following the determination.

If this subpart is inoperative, then candidates seeking election to the state house of representatives may seek public funding under subpart B.

§11-C Qualifications for comprehensive public funding. (a) A candidate is qualified to seek comprehensive public funding for the primary election campaign period if the candidate:

(1) Resides in the district from which nomination is sought as of date of the filing of nomination papers;

(2) Is a registered voter in the district from which nomination is sought;

(3) Files a declaration of intent to seek comprehensive public funding with the commission, which shall be filed no later than the last date to file nomination papers in accordance with section 12-6, Hawaii Revised Statutes, that identifies the district in which the candidate intends to seek nomination;

(4) Collects a $3 qualifying contribution in accordance with section 11-F from at least one and one half per cent of the voters who registered to vote in the previous regular general election in the district in which the candidate seeks nomination; and

(5) Accepts only the following contributions during the qualifying period:

(A) Seed money contributions;

(B) Qualifying contributions; and

(C) Comprehensive public funding, after certification as a comprehensive publicly funded candidate.

(6) Files an application for certification for comprehensive public funding with the commission in accordance with this subpart.

(b) A candidate is qualified to seek comprehensive public funding for the general election campaign period if the candidate:

(1) Was certified as a comprehensive publicly funded candidate during the primary election campaign period; and

(2) Received a sufficient number of votes to appear on the ballot in the general election or did not have a contested primary election.

§11-D Seed money contributions; limitations on use of seed money; penalties. (a) Seed money shall be used only for expenditures necessary to determine whether sufficient support exists to run for office. Appropriate expenditures of seed money include office supplies and equipment, communications to voters in the district in which the candidate intends to seek nomination or election, and expenses relating to meetings with district residents. Seed money shall not be spent for any salaries, rental of premises, or to pay any person to solicit or collect qualifying contributions.

(b) The amount of seed money retained, expended, or both, by a candidate shall not exceed a total of $3,000.

(c) Contributions of seed money from any single person shall not exceed $250, including in-kind contributions.

(d) A candidate may use personal funds or surplus campaign funds for seed money purposes, all of which shall be subject to the $3,000 limit in subsection (b).

(e) Seed money shall only be collected or spent prior to the date the candidate files the declaration of intent to seek comprehensive public funding.

(f) A candidate shall not accept seed money from any contributor unless the candidate issues a receipt to the contributor confirming the following information:

(1) The contributor's signature, printed name, home address, zip code, telephone number;

(2) Contribution amount or value; and

(3) The date of the contribution.

(g) Within forty-eight hours after certification as a comprehensive publicly funded candidate, a candidate shall:

(1) Fully disclose all seed money contributions and expenditures to the commission; and

(2) Return to the commission, for deposit in the Hawaii election campaign fund:

(A) Any seed money contributions that exceed the seed money expenditure limit; and

(B) Unspent seed money, not otherwise legally obligated.

(h) No comprehensive publicly funded candidate shall accept seed money from a person who makes the contribution under the name of another person. Knowing violation of this subsection shall result in a fine equal to five times the amount of the contribution, in addition to any other penalties or prosecution in accordance with sections 11-228 and 11-229.

§11-E Restriction on use of surplus campaign funds. Except as provided in section 11-D(d), a comprehensive publicly funded candidate who has surplus campaign funds from a previous election is prohibited from using those funds upon filing the declaration of intent to seek comprehensive public funding under this subpart. The surplus campaign funds shall be frozen and maintained in a separate depository account from that established for the comprehensive public funds under section 11-Q. The comprehensive publicly funded candidate shall continue to file reports on the surplus campaign funds in accordance with subpart B or otherwise as may be required by the commission.

§11-F Qualifying contributions; penalties. (a) Each qualifying contribution shall meet the requirements of this section. To be counted as a qualifying contribution:

(1) The contributor shall be a registered voter residing within the district in which the candidate seeks nomination at the time the contribution is given;

(2) A contribution shall be:

(A) In the amount of $3;

(B) Made in cash or by check or money order;

(C) Acknowledged by a receipt meeting the requirements in subsections (c) and (d); and

(D) Collected by the candidate in person or by volunteers on behalf of the candidate.

(b) No qualifying contribution shall be collected prior to a candidate's filing of a declaration of intent to seek comprehensive public funding with the commission.

(c) A receipt for a qualifying contribution shall indicate, by the contributor's signature, that the contributor understands that the purpose of the contribution is to help the candidate qualify for comprehensive public funding. The receipt shall include the following information:

(1) The contributor's signature, printed name, home address, zip code, and telephone number;

(2) The name of the candidate on whose behalf the qualifying contribution is made;

(3) An affirmation by the contributor that the contributor received nothing of value for the signature and the contribution; and

(4) The date of the contribution.

(d) The original receipt shall be given to the contributor. A copy shall be retained by the candidate, and a copy shall be submitted to the commission upon application for certification as a comprehensive publicly funded candidate. A contribution submitted as a qualifying contribution that does not include a signed and completed receipt shall not be counted as a qualifying contribution.

(e) No candidate seeking to qualify as a comprehensive publicly funded candidate shall accept a qualifying contribution from a contributor in the name of another individual, who is not the individual identified on the receipt. Knowing violation of this subsection shall disqualify the candidate from comprehensive public funding for that election period and may subject the candidate to other fines or prosecution pursuant to sections 11-228 and 11-229.

(f) A candidate's qualifying contributions shall be deposited in an escrow account maintained by the commission until the commission determines that the candidate has fulfilled the requirements for comprehensive public funding and is certified as a comprehensive publicly funded candidate. Upon certification, the candidate's qualifying contributions shall be deposited into the Hawaii election campaign fund.

(g) Qualifying contributions collected by a candidate who is not certified for comprehensive public funding shall be returned to the candidate who shall return the qualifying contributions to the contributors or shall be deposited into the Hawaii election campaign fund.

§11-G Certification for comprehensive public funds. (a) A candidate seeking certification as a comprehensive publicly funded candidate shall submit to the commission an application for certification no later than fifteen business days prior to the primary election, signed by the candidate and the candidate's campaign treasurer under penalty of perjury, that shall include:

(1) An affidavit from the office of elections certifying that the candidate's qualifying contributors were all registered voters in the candidate's district for the preceding general election; and

(2) An alphabetized list of all qualifying contributors and copies of receipts given to contributors.

(b) The commission shall issue a decision to certify or deny certification of a candidate as a comprehensive publicly funded candidate within five business days following receipt of the candidate's completed application for certification for comprehensive public funds.

(c) The number of comprehensive publicly funded candidates certified by the commission shall be limited to not more than three candidates in each district, on a first-come, first-served basis, based on date that the application for certification is submitted.

(d) After a candidate is certified as a comprehensive publicly funded candidate, the candidate's certification shall apply to both the primary and the general election, even if the candidate is unopposed in the primary election.

(e) A candidate who is not certified for comprehensive public funding under this subpart may seek public funding under subpart B.

§11-H Comprehensive publicly funded candidates; contributions and expenditures; penalties. A candidate who has been certified for comprehensive public funding shall comply with the following restrictions on contributions and expenditures:

(1) Upon certification for comprehensive public funding and until the end of the general election period, a comprehensive publicly funded candidate shall not accept for use in the campaign:

(A) Contributions from any person; except that the candidate may accept in-kind contributions aggregating less than $100 from any single person;

(B) Loans from any person, including a loan from the candidate; and

(C) Contributions from political parties.

(2) Upon certification for comprehensive public funding and until the end of the general election period, a comprehensive publicly funded candidate shall not expend for campaign purposes:

(A) Any money except public funds issued by the commission;

(B) Seed money contributions;

(C) Public funds for purposes other than those permitted in this subpart;

(D) Public funds outside the applicable election campaign period for which the funding is allocated, except as permitted in this subpart or for proper campaign debts incurred but not paid;

(E) Funds in excess of the public funds allocated to the candidate, including equalizing funds, or incur an obligation to spend in excess of the public funds allotted; and

(F) Petty cash expenditures in excess of $100 in any seven consecutive day period.

(3) A comprehensive publicly funded candidate who accepts contributions in violation of this section shall be subject to a fine equal to three times the public funding received, in addition to any other action, fines or prosecution under section 11-S.

(4) A comprehensive publicly funded candidate who spends or incurs an obligation to spend more than one hundred per cent of the public funds allocated shall repay the Hawaii election campaign fund an amount equal to three times the excess expenditure.

§11-I Comprehensive publicly funded candidates; reporting.

(a) A comprehensive publicly funded candidate and the candidate's committee shall furnish complete campaign records, including all records of non-monetary contributions, seed money contributions, qualifying contributions to the commission, and expenditures. A candidate shall fully cooperate with any audit or examination by the commission.

(b) A comprehensive publicly funded candidate and the candidate's committee shall comply with the reporting requirements of sections 11-194, 11-195, 11-196, 11-212, and 11-213 in subpart B in addition to those required under this subpart. A comprehensive publicly funded candidate shall also include petty cash expenditures in any expenditure report required under subpart B.

§11-J Comprehensive publicly funded candidates; continuing obligation. (a) A comprehensive publicly funded candidate shall comply with all requirements under this subpart through the general election campaign period regardless of whether the candidate maintains eligibility for comprehensive public funding in the general election campaign period.

(b) Except for seed money contributions, a comprehensive publicly funded candidate who is elected may not accept private contributions from any person or political party until either September 1 of the odd-numbered year following the general election or the date when the commission determines there are insufficient funds under section 11-B, whichever occurs earlier.

(c) If a comprehensive publicly funded candidate withdraws from seeking nomination for or election to the house of representatives, all unused public funds shall be returned to the Hawaii election campaign fund.

§11-K Amount of public funding; disbursements. (a) The commission shall disburse public funds by check within two business days after the candidate is certified for comprehensive public funding. The commission shall disburse the public funds allotted for a contested election unless the filing deadline for nomination papers has passed and the commission knows that the election will not be contested.

(b) A comprehensive publicly funded candidate certified for the primary election campaign period may expend public funds on the date that certification is issued by the commission; provided that the candidate has filed the appropriate nomination papers in accordance with section 12-6. A comprehensive publicly funded candidate certified for a general election campaign period may expend public funds on the date that certification is issued by the commission.

(c) The amount of public funding shall be set at one hundred and fifty per cent of the voluntary expenditure limit for the office of state representative pursuant to section 11-209. This amount shall be allotted to the candidate for each contested primary and general election.

(d) The amount of public funding for an uncontested primary election shall be thirty per cent of the amount provided in a contested election. A candidate who receives public funding at the contested amount before it is known whether the primary election is contested, and thereafter the primary election is not contested, shall have the public funding allotment for the general election offset by the amount received in excess of the thirty per cent allotted for the uncontested primary election.

(e) A comprehensive publicly funded candidate who is successful in the primary election may use unspent comprehensive public funds for the general election. A comprehensive publicly funded candidate who is not successful in the primary election shall return all unspent and unencumbered public funds to the Hawaii campaign election fund.

§11-L Equalizing funds. (a) Equalizing funds are supplemental public funds released by the commission to comprehensive publicly funded candidates to allow them to stay financially competitive with opposing privately funded candidates during a campaign. This allocation shall be released when the reported cumulative amount spent and obligated by a privately funded candidate and supporting noncandidate committee exceeds the initial amount allocated to the comprehensive publicly funded candidate by fifty per cent or more in that election contest. These equalizing public funds shall be released by the commission when the cumulative amount spent and obligated by a comprehensive publicly funded candidate's opponent and the opponent's supporting noncandidate committee exceeds the initial amount allocated to the comprehensive publicly funded candidate by fifty per cent or more in that primary or general election contest.

(b) Equalizing payment checks shall be available within five working days of the filing with the commission of any report required under this chapter.

(c) If a nonparticipating candidate does not report expenditures and legal obligations to the commission in the prescribed timetable established in section 11-212, the commission shall automatically disburse a full equalizing payment increment to the comprehensive publicly funded candidate.

§11-M Computation and distribution of equalizing funds. (a) Upon request by the comprehensive publicly funded candidate for equalizing funds, the commission shall determine whether the candidate is entitled to an allocation of equalizing funds based on information disclosed by an opponent of a comprehensive publicly funded candidate in any expenditure report required under this chapter, in the manner provided in subsections (b) and (c).

(b) The commission shall add:

(1) The sum of an opposing candidate's expenditures and obligations, or funds raised and borrowed, whichever is greater, including surplus or unspent funds carried forward from a previous primary or general election to the current election; and

(2) The sum of the independent expenditures made expressly advocating the defeat of the certified comprehensive publicly funded candidate or the election of the same opposing candidate. The amount that a noncandidate committee expends on supporting or opposing multiple candidates shall be pro-rated by the commission and applied to this candidate contest.

(c) From the total determined in subsection (b), the commission shall then subtract:

(1) The sum of the independent expenditures made for the purpose of expressly advocating the defeat of the same opposing candidate; and

(2) The sum of the independent expenditures made for the purpose of expressly advocating the election of the certified comprehensive publicly funded candidate. The amount that a noncandidate committee expends on supporting or opposing multiple candidates shall be pro-rated by the commission and applied to this candidate contest; and

(3) The sum of any seed money raised in computing fund eligibility for a primary or general election, as applicable, or any surplus or unspent funds carried forward from the primary election to the subsequent general election of the same year in computing equalizing fund eligibility for a general election.

(d) If the final computed amount is greater than the applicable initial distribution amount for the comprehensive publicly funded candidate and exceeds the fifty per cent trigger amount, then the commission shall immediately authorize the distribution of an equalizing allocation to the comprehensive publicly funded candidate, up to initial distribution amount.

(e) The commission shall make computations promptly upon the filing of campaign finance reports and independent expenditure reports.

(f) All candidates, candidate's committees, and noncandidate committees shall submit a report to the commission within forty-eight hours of any encumbrance, obligation, or expenditure to secure, contract, or purchase any goods or services defined as an independent expenditure under section 11-A if the aggregate total by the candidate, candidate's committee, or noncandidate committee, during that forty-eight hour reporting period exceeds $1,000. The report shall include a listing of all encumbrances, obligations, or actual expenditures made and incurred during the forty-eight hour period. An electronic version of each report required by this subsection shall be posted by the commission not later than one business day after the report has been filed or received.

The commission shall adopt rules under chapter 91 to specify a standard format for use in preparing and filing reports required by this subsection, and criteria for determining whether and if so when an obligation to make campaign expenditures has been incurred.

For purposes of this subsection:

(1) Campaign expenditures actually made during a reporting period that have been reported during a previous reporting period as an obligation incurred need not be:

(A) Reported as expenditures actually made; and

(B) Included in any computation to determine whether the $1,000 reporting threshold has been reached;

provided that if the expenditure actually made exceeds the amount reported as incurred, then the amount of the excess shall be included in both the computation of the threshold as well as the report of actual expenditures if required; and

(2) Any obligation to make campaign expenditures that is incurred during a reporting period but rescinded during the same reporting period need not be included in any report required by this subsection.

(g) If the commission determines that a privately funded candidate or the candidate's committee for a privately funded candidate has failed to file a report required by subsection (f) or has filed a false report, then the commission shall release equalizing funds to the comprehensive publicly funded candidate to the full extent authorized by this subpart.

(h) Any person required to file reports under subsection (f) who either fails to file a required report or who files a false report shall be guilty of a misdemeanor; provided that upon conviction, the court shall impose a fine equal to amount of equalizing funds released or authorized to be released by the commission to the comprehensive publicly funded candidate. The court shall order that the fine be paid to the Hawaii election campaign fund.

(i) To prevent the abuse of the equalizing fund provision, the commission shall not base any calculation on independent expenditures that, although containing words of express advocacy, also contain other words or phrases that have no other reasonable meaning other than to contradict the expressed advocacy.

§11-N Equalizing fund cap. A comprehensive publicly funded candidate shall not be entitled to cumulative equalizing funds for multiple opponents that would exceed one hundred per cent of the initial distribution of funds.

§11-O Disclosure of independent expenditures; penalties. (a) Any person that incurs any independent expenditure during a primary or general election campaign period that, in the aggregate, exceeds $1,000 shall:

(1) Register with the commission as a noncandidate committee;

(2) Report to the commission the names of any candidates that the committee supports or opposes; and

(3) Conform to all applicable laws.

(b) The report to the commission shall include a signed statement by the person making the independent expenditure, identifying the candidate or candidates whom the independent expenditure is intended to help elect or defeat and affirming that the expenditure is totally independent and involves no cooperation or coordination with a candidate or a political party.

(c) A person may file a complaint with the commission if the person believes that any part of such a statement is false. The commission shall make a prompt determination with respect to the complaint.

(d) Any person that fails to file the required report to the commission or provides materially false information in the report may be fined up to three times the amount of the independent expenditure.

§11-P Comprehensive public funding; permitted uses. (a) Comprehensive public funds shall be used only for the purpose of defraying expenses that are directly related to the candidate's campaign during the election campaign period for which the comprehensive public funds are allocated, including:

(1) The purchase and development of campaign literature and signs;

(2) The development and purchase of media space and time, including web site and internet communication;

(3) Mailings;

(4) Telephones and telecommunications;

(5) General office supplies;

(6) The rental of campaign equipment;

(7) Utility costs associated with the campaign; and

(8) Campaign headquarters rental, salaries, and independent contractors that in the aggregate do not exceed twenty per cent of the allocated comprehensive public funds.

(b) Expenditures shall not be made:

(1) In violation of any law;

(2) To pay any personal, family, or business expenses, loans, or debts;

(3) For any non-campaign-related expenses or for indirect campaign-related expenses; or

(4) To immediate family members, except as reimbursement for proper expenses incurred under this section.

§11-Q Deposit of and access to comprehensive public funds. (a) All public funds received by a comprehensive publicly funded candidate shall be deposited directly into a depository institution as provided under section 11-199(a) and accessed through use of credit cards, debit cards, and bank checks.

(b) All reports required under subpart B and this subpart for financial disclosure shall include the most recent bank statement from the financial depository holding the public funds.

§11-R Deposit of money into the Hawaii election campaign fund. In addition to the funds collected by the commission and pursuant to section 11-217, the following money shall be deposited into the Hawaii election campaign fund:

(1) Excess seed money contributions;

(2) Qualifying contributions, including any excess qualifying contributions of candidates who were certified to receive comprehensive public funding;

(3) Unspent public funds distributed to any comprehensive publicly funded candidate;

(4) Fines levied by the commission against a comprehensive publicly funded candidate for violation of election laws; and

(5) Voluntary donations.

§11-S Violations; penalties. A candidate who knowingly violates the requirements of this subpart may:

(a) Have the certification for comprehensive public funding revoked. Upon revocation of certification, the candidate shall repay all public funds received within ten business days; and

(b) Be subject to fines and penalties as specifically provided in this subpart and other fines or prosecution pursuant to sections 11-228 and 11-229.

§11-T Rules. The commission shall adopt forms and rules pursuant to chapter 91 as may be necessary to implement this subpart."

SECTION 3. Section 11-191, Hawaii Revised Statutes, is amended by amending the definition of "qualifying campaign contribution" to read as follows:

"Qualifying campaign contribution" means an aggregate monetary contribution of $100 or less, by any person during any matching payment period[.] for purposes of entitlement to payments under the public funding program pursuant to subpart B. Qualifying contributions do not include loans or in-kind contributions."

SECTION 4. Section 11-217, Hawaii Revised Statutes, is amended to read as follows:

"§11-217 Hawaii election campaign fund; creation. The Hawaii election campaign fund is created as a trust fund within the state treasury. The fund shall consist of all moneys collected from persons who have designated a portion of their income tax liability to the fund as provided in section 235-102.5, any general fund revenues appropriated, as well as all other moneys collected pursuant to [this subpart.] subparts B and C. The Hawaii election campaign fund shall fund eligible candidates pursuant to subpart B and subpart C. Payment to [each candidate] eligible candidates from the fund shall be by the comptroller [in the manner prescribed in section 11-222]. Moneys from this fund may also be used for the operating expenses of the commission, including staff salaries and fringe benefits."

SECTION 5. Section 11-218, Hawaii Revised Statutes, is amended to read as follows:

"§11-218 Candidate funding; amounts available. (a) The maximum amount of public funds available to a candidate for the office of governor, lieutenant governor, or mayor in any election shall not exceed ten per cent of the total expenditure limit for each election as established for each office listed in this subsection pursuant to section 11-209.

(b) For the office of state senator, state representative, county council member, and prosecuting attorney, the maximum amount of public funds available to a candidate in any election shall be fifteen per cent of the total expenditure limit for each election as established for each office listed in this subsection pursuant to section 11-209, except for the candidates eligible for public funding under subpart C.

(c) For the board of education and all other offices, the maximum amount of public funds available to a candidate shall not exceed $100 in any election year.

(d) Each candidate who qualified for the maximum amount of public funding in any primary or special primary election and who is a candidate for a subsequent general election shall apply with the commission to be qualified to receive the maximum amount of public funds as provided in this section for the respective election. For purposes of this section [qualified], "qualified" means meeting the qualifying campaign contribution requirements of section 11-219."

SECTION 6. Section 11-219, Hawaii Revised Statutes, is amended to read as follows:

"§11-219 Qualifying campaign contributions; amounts. As a condition of receiving public funds for a primary, special primary, or general election, a candidate shall not be unopposed in any election for which public funds are sought, and shall have filed an affidavit with the commission pursuant to section 11-208 to voluntarily limit the candidate's campaign expenditures and shall be in receipt of the following sum of qualifying campaign contributions for the candidate's respective office for each election:

(1) For the office of governor--qualifying campaign contributions that in the aggregate, exceed $100,000;

(2) For the office of lieutenant governor--qualifying campaign contributions that in the aggregate, exceed $50,000;

(3) For the office of mayor for each respective county:

(A) County of Honolulu--qualifying campaign contributions that in the aggregate, exceed $50,000;

(B) County of Hawaii--qualifying campaign contributions that in the aggregate, exceed $15,000;

(C) County of Maui--qualifying campaign contributions that in the aggregate, exceed $10,000; and

(D) County of Kauai--qualifying campaign contributions that in the aggregate, exceed $5,000; and

(4) For the office of prosecuting attorney for each respective county:

(A) County of Honolulu--qualifying campaign contributions that in the aggregate, exceed $30,000;

(B) County of Hawaii--qualifying campaign contributions that in the aggregate, exceed $10,000; and

(C) County of Kauai--qualifying campaign contributions that in the aggregate, exceed $5,000;

(5) For the office of county council--for each respective county:

(A) County of Honolulu--qualifying campaign contributions that in the aggregate, exceed $5,000;

(B) County of Hawaii--qualifying campaign contributions that in the aggregate, exceed $1,500;

(C) County of Maui--qualifying campaign contributions that in the aggregate, exceed $5,000; and

(D) County of Kauai--qualifying campaign contributions that in the aggregate, exceed $3,000;

(6) For the office of state senator--qualifying campaign contributions that, in the aggregate, exceed $2,500;

(7) For the office of state representative--qualifying campaign contributions that, in the aggregate, exceed $1,500; and

(8) For all other offices, qualifying campaign contributions that, in the aggregate, exceed $500."

SECTION 7. Section 11-220, Hawaii Revised Statutes, is amended to read as follows:

"§11-220 Eligibility for payments. (a) To be eligible to receive [payments under section 11-217,] public funding from the Hawaii election campaign fund in under section 11-221, a candidate shall in writing:

(1) Agree to obtain and furnish to the commission any evidence of the campaign expenses of such candidate which the commission may request;

(2) Agree to keep and furnish records, books, and other information which the commission may request; and

(3) Agree to an audit and examination by the commission under section 11-225 and to pay any amounts required to be paid pursuant to such section.

(b) To be eligible to receive [payments pursuant to section 11-217,] public funding from the Hawaii election campaign fund in accordance with section 11-221, a candidate shall certify to the commission that:

(1) Such candidate and all committees authorized by such candidate shall not incur campaign expenses in excess of the expenditure limitations imposed by section 11-209;

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

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

(4) Such candidate or committee authorized by such candidate has received the qualifying sum of private contributions for the office sought by the candidate as set forth in section 11-219;

(5) The aggregate of contributions certified with respect to any person under paragraph (4) does not exceed $100.

(c) Each candidate and all committees authorized by such 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 and mailing address 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.

(d) No candidate certified for comprehensive public funding under subpart C shall be eligible for public funding under subpart B in a given election period."

SECTION 8. Section 11-221, Hawaii Revised Statutes, is amended to read as follows:

"§11-221 Entitlement to [payments.] public funding. Every candidate who is eligible to receive public funds pursuant to section 11-220 is entitled to payments pursuant to section 11-217 in an amount equal to each qualifying campaign contribution received by that candidate or candidate committee during the matching payment period involved. A qualifying campaign contribution shall be attributed to a primary, special, or general election.

A candidate eligible to receive public funds must obtain a minimum amount of qualifying campaign contributions as set forth in section 11-219 in order to be entitled to receive any matching public funds in an election. For the purpose of this section, a candidate must have at least one other qualified candidate as an opponent for the primary, special, or general election to receive public funds for that election."

SECTION 9. Section 11-228, Hawaii Revised Statutes, is amended to read as follows:

"§11-228 Administrative fines; relief. (a) In the performance of its required duties, the commission may render a decision or issue an order affecting any person violating any provision of [this subpart] subparts B and C or section 281-22 that shall provide for the assessment of an administrative fine in the manner prescribed as follows:

(1) If a natural person, an amount not to exceed $1,000 for each occurrence or an amount equivalent to three times the amount of an unlawful contribution or expenditure, whichever is greater; or

(2) If a corporation, organization, association, or labor union, it shall be punished by a fine not exceeding $1,000 for each occurrence; and

(3) Whenever a corporation, organization, association, or labor union violates this subpart, the violation shall be deemed to be also that of the individual directors, officers, or agents of the corporation, organization, association, or labor union, who have knowingly authorized, ordered, or done any of the acts constituting the violation.

(b) Any order for the assessment of an administrative fine may not be issued against a person without providing the person written notice and an opportunity to be heard at a hearing conducted under chapter 91. A person may waive these rights by written stipulation or consent. If an administrative fine is imposed upon a candidate, the commission may order that the fine, or any portion, be paid from the candidate's personal funds.

(c) If an order issued by the commission is not complied with by the person to whom it is directed, the first circuit court, upon application of the commission, shall issue an order requiring the person to comply with the commission's order. Failure to obey such a court order shall be punished as contempt.

(d) Any administrative fine collected by the commission shall be deposited in the Hawaii election campaign fund.

(e) Any person or the commission may sue for injunctive relief to compel compliance with [this subpart] subparts B and C.

(f) The provisions of this section shall not be construed to prohibit prosecution under any appropriate provision of the Hawaii Penal Code or section 11-229.

(g) The provisions of this section shall not apply to any person who, prior to the commencement of proceedings under this section, has paid or agreed to pay the penalties prescribed by sections 11-193(a)(5) and 11-215(c)."

SECTION 10. Section 11-229, Hawaii Revised Statutes, is amended to read as follows:

"§11-229 Criminal prosecution. (a) Any person who knowingly, intentionally, or recklessly violates any provision of [this subpart] subparts B and C shall be guilty of a misdemeanor. A person who is convicted under this section shall be disqualified from holding elective public office for a period of four years from the date of conviction.

(b) For purposes of prosecution for violation of [this subpart] subparts B and C, the offices of the attorney general and the prosecuting attorney of the respective counties shall be deemed to have concurrent jurisdiction to be exercised as follows:

(1) Prosecution shall commence with a written request from the commission or upon the issuance of an order of the court; provided that prosecution may commence prior to any proceeding initiated by the commission or final determination;

(2) In the case of state offices, parties, or issues, the attorney general or the prosecuting attorney for the city and county of Honolulu shall prosecute any violation; and

(3) In the case of all other offices, parties, or issues, the attorney general or the prosecuting attorney for the respective county shall prosecute any violation.

In the commission's choice of prosecuting agency, it shall be guided by whether there will be any conflicting interest between the agency and its appointive authority.

(c) The court shall give priority to the expeditious processing of suits under this section.

(d) Prosecution for violation of any provision of [this subpart] subparts B and C shall not be commenced after five years have elapsed from the date of the violation or date of filing of the report covering the period in which the violation occurred, whichever is later.

(e) The provisions of this section shall not apply to any person who, prior to the commencement of proceedings under this section, has paid or agreed to pay the penalties prescribed by sections 11-193(a)(5) and 11-215(c). "

SECTION 11. There is appropriated out of the Hawaii election campaign fund the sum of $150,000, or so much thereof as may be necessary for fiscal year 2004-2005, for the campaign spending commission to provide three additional staff positions to support publicly funded elections for the state legislature as follows:

(1) Two staff positions for computer analysis of campaign contributions for auditing and monitoring; and

(2) One staff position to administer the comprehensive public funding program.

SECTION 12. The sum appropriated shall be expended by the campaign spending commission for the purposes of this Act.

SECTION 13. The campaign spending commission shall write and publish all forms required as well as a candidates' guide to the comprehensive public funding program that shall include an explanation of rules and procedures applicable to candidates. In addition to the reports required by section 11-210, Hawaii Revised Statutes, the campaign spending commission, in cooperation with the League of Women Voters and other relevant stakeholders, shall conduct a comprehensive study of the campaign financing system in Hawaii following the first election under this Act, and shall report to the legislature, no later than twenty days before the convening of the regular session of the year following the year of the study, with the following information:

(1) A detailed summary of all seed money contributions, qualifying contributions, public funds disbursements, and public-financed candidate expenditures spent in the election and the balance remaining in the Hawaii election campaign fund;

(2) Suggested amendments to this Act that may address the need to improve equalizing public funding to match independent expenditures and any excess expenditures of publicly funded and nonparticipating candidates;

(3) Suggested amendments to this Act that will extend publicly funded campaigns to state senate and other state and county elections;

(4) A summary and evaluation of the commission's activities and recommendations to enhance the effective and timely administration and enforcement of this Act; and

(5) Examine mechanisms for increasing revenues of the Hawaii election campaign fun, including methods used in other states.

The legislative reference bureau shall assist the campaign spending commission in drafting any proposed amendments to this Act recommended by the campaign spending commission.

SECTION 14. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 15. If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 16. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 17. This Act shall take effect on January 1, 2005.