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. (SB3104 HD1)
THE SENATE |
S.B. NO. |
3104 |
TWENTY-SECOND LEGISLATURE, 2004 |
S.D. 2 |
|
STATE OF HAWAII |
H.D. 1 |
|
|
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 agreement regarding the need for the reform of funding public elections in Hawaii. Many citizens feel a growing sense of cynicism and frustration regarding the practices of soliciting, raising, and spending large private campaign contributions by candidates and elected officials. These practices create the perception of undue influence on candidates or elected officials by moneyed private interests and the 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.
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 in section 11-191.
"Candidate's committee" means a committee, as defined in section 11-191, 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.
"Certified candidate" or "comprehensive publicly funded candidate" means a participating 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.
"Commission" shall be as defined in section 11-191.
"Committee" shall be as defined in section 11-191.
"Contested election" means, in a primary election, the certified candidate is opposed by one or more nonparticipating candidates for the nomination and, in a general election, the certified candidate is opposed by one or more nonparticipating candidates for election to the office.
"Contribution" shall be as defined in section 11-191.
"District" means a state house of representatives district as established in accordance with the article III, section 3 of the state constitution.
"Declaration of intent to seek comprehensive public funding" means the form completed by a participating candidate and the filing of which triggers the end of the participating candidate's ability to spend seed money and permits the participating 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 certified candidate to allow the certified candidate to be financially competitive with a nonparticipating candidate in a contested election.
"Excess expenditure" means the amount of comprehensive public funds spent or obligated to be spent by a certified candidate in excess of one hundred per cent of the allocated funds for the candidate 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 noncandidate committee, party, or any other person for a communication that expressly advocates the nomination, election or defeat of a clearly identified certified or nonparticipating 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 certified or nonparticipating candidate and their candidate's committee, or their agents. For purposes of this definition, the term "clearly identified" means that the name, likeness, photograph or drawing of the certified or nonparticipating candidate is used, or the identity of the certified or nonparticipating candidate is apparent by unambiguous reference. Any expenditure to design, produce or disseminate a communication that is disseminated within thirty days before a primary election or sixty days before the general election shall be presumed to be an independent expenditure subject to the reporting requirements of this subpart; provided that a person may rebut the presumption by filing a written statement with the commission within forty-eight hours of making the expenditure stating facts showing that the expenditure was not intended to influence the nomination, election or defeat of a comprehensive publicly funded candidate.
"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.
"Nonparticipating candidate" means a candidate for the state house of representatives who does not qualify for or receive public funding during an election period and is involved in a contested election with a certified candidate.
"Participating candidate" means a candidate for the state house of representatives who is seeking to be certified for comprehensive public funding under this subpart.
"Party" shall be as defined in section 11-191.
"Person" shall be as defined in section 11-191.
"Primary election campaign period" means the period in a primary election year beginning with the certification for comprehensive public funding under this subpart and ending two weeks after the primary election.
"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 participating candidate for purposes of meeting the criteria of section 11-F.
"Qualifying period" means the period in a general election year, beginning January 1 and ending on the deadline for filing nomination papers in accordance with section 12-6, Hawaii Revised Statutes, to run in the primary election during which a participating candidate shall file a declaration of intent to seek comprehensive public funding to 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 participating candidate by a person in accordance with section 11-D that shall be expended for the purpose of determining campaign viability.
"Surplus campaign funds" means any campaign contributions not spent during a prior election period by a participating candidate who previously sought election as a privately funded candidate.
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 is a minimum of $3.5 million in the Hawaii election campaign fund to certify participating candidates for comprehensive public funding under this subpart.
If the commission determines that there is sufficient funding, the commission shall publish notice statewide within five business days 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 participating candidate is qualified to seek certification for comprehensive public funding to be expended during the primary election campaign period if the participating 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 in a general election year between January 1 and thirty days before the last date to file nomination papers in accordance with section 12-6, Hawaii Revised Statutes, that identifies the district in which the participating candidate intends to seek nomination;
(4) Collects a $3 qualifying contribution in accordance with section 11-F;
(5) Accepts only the following types of campaign contributions prior to applying for certification as a comprehensive publicly funded candidate:
(A) Seed money that may be accepted only before filing the declaration of intent to seek comprehensive public funding; and
(B) Qualifying contributions that may be accepted only after filing the declaration of intent to seek comprehensive public funding;
and
(6) Files an application for certification for comprehensive public funding with the commission in accordance with this subpart.
(b) A certified candidate is qualified to seek comprehensive public funding to be expended during the general election campaign period if the certified candidate:
(1) Was a certified candidate during the primary election; and
(2) Received a sufficient number of votes to appear on the ballot in the general election or is otherwise certified by the office of elections to be placed on the ballot in the general 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 for a participating candidate to run as a comprehensive publicly funded candidate. Appropriate expenditures of seed money include office supplies and equipment, communications to voters in the district in which the participating 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 received and expended by a participating candidate and the candidate's committee shall not exceed $3,000.
(c) Contributions of seed money from any single person shall not exceed $250, including in-kind contributions.
(d) A participating candidate shall not accept contributions of seed money from any person whose contributions are prohibited under subpart B.
(e) A participating 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).
(f) Seed money shall only be collected or spent prior to the date the participating candidate files the declaration of intent to seek comprehensive public funding.
(g) A participating candidate shall not accept seed money from any contributor unless the participating candidate issues a receipt to the contributor that includes the following information:
(1) The contributor's signature, printed name, home address, zip code, telephone number;
(2) The contribution amount or value; and
(3) The date of the contribution.
(h) Within forty-eight hours after certification as a comprehensive publicly funded candidate, a certified 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.
(i) No participating candidate shall solicit or accept seed money from a contributor in violation of this section or in the name of an individual who is not the individual identified on the receipt. A participating candidate who violates this section with the intent to fraudulently obtain comprehensive public funding:
(1) Shall be disqualified from comprehensive public funding for that election period;
(2) Shall be subject to a fine up to five times the amount of the contribution; and
(3) May be subject to other fines or prosecution pursuant to sections 11-228 and 11-229.
§11-E Restriction on use of surplus campaign funds. The use of surplus campaign funds is prohibited upon filing the declaration of intent to seek comprehensive public funding under this subpart. Surplus campaign funds shall be frozen and maintained in a depository account separate from the account established for the comprehensive public funds under section 11-N. A certified candidate is prohibited from using surplus campaign funds through the end of the general election period and shall continue to file reports on the surplus campaign funds in accordance with subpart B or as may be otherwise required by the commission.
§11-F Qualifying contributions; penalties. (a) The commission shall establish the minimum number of qualifying contributions that a participating candidate shall collect to be certified for comprehensive public funding. The minimum number of qualifying contributions shall be based on one and one-half per cent of the number of registered voters in the previous regular general election in the district in which the candidate seeks nomination;
(b) Each qualifying contribution shall meet the requirements of this section. To be counted as a qualifying contribution:
(1) The contributor of the contribution shall be a registered voter within the district in which the participating candidate seeks nomination on the date the qualifying contribution is given;
(2) A qualifying 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 (d) and (e); and
(D) Collected by the participating candidate in person or by volunteers on behalf of the participating candidate.
(c) No qualifying contribution shall be collected prior to a participating candidate's filing of a declaration of intent to seek comprehensive public funding with the commission.
(d) 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 participating 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 last four digits of the contributor's social security number for purposes of verifying voter registration;
(3) The name of the participating candidate on whose behalf the qualifying contribution is made;
(4) An affirmation by the contributor that the contributor received nothing of value for the signature and the qualifying contribution; and
(5) The date of the qualifying contribution.
(e) The original receipt shall be given to the contributor. A copy shall be retained by the participating 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.
(f) No participating candidate shall solicit or accept a qualifying contribution from a contributor in violation of this section or in the name of an individual who is not the individual identified on the receipt. A participating candidate who violates this section with the intent to fraudulently obtain comprehensive public funding:
(1) Shall be disqualified from comprehensive public funding for that election period;
(2) Shall be subject to a fine up to five times the amount of public funding received; and
(3) May be subject to other fines or prosecution pursuant to sections 11-228 and 11-229.
(g) A participating candidate shall submit an alphabetized list of qualifying contributors and the date the qualifying contributions were made to the office of elections for verification that every qualifying contributor was a registered voters within the district in which the participating candidate seeks nomination on the date the contribution was made. Within three weeks of submission of the list, the office of elections shall provide the participating candidate with an affidavit certifying the qualifying contributors were registered voters.
(h) A participating candidate's qualifying contributions shall be deposited in an escrow account maintained by the commission until the commission determines that the participating candidate has fulfilled the requirements for comprehensive public funding and is certified as a comprehensive publicly funded candidate. Upon certification, the certified candidate's qualifying contributions shall be deposited into the Hawaii election campaign fund.
(i) Qualifying contributions collected by a participating candidate who is not certified for comprehensive public funding shall be returned to the participating candidate who shall return the qualifying contributions to the contributors within sixty days; provided that the qualifying contributions that are not returned to the contributors shall be deposited into the Hawaii election campaign fund.
§11-G Certification for comprehensive public funds. (a) A participating candidate seeking certification as a comprehensive publicly funded candidate shall submit to the commission an application for certification no later than thirty business days prior to the primary election, with an original signed by the participating candidate and the participating candidate's campaign treasurer under penalty of perjury, that shall include:
(1) An original affidavit from the office of elections certifying that each of the participating candidate's qualifying contributors were registered voters within the district in which the participating candidate seeks nomination on the date the qualifying contributions were made; 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 participating candidate as a comprehensive publicly funded candidate within five business days following receipt of the participating 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 the date that the application for certification is submitted in accordance with subsection (a).
For purposes of computing the first-come, first-served basis, the commission shall date and time stamp all applications upon receipt. Applications may be submitted by facsimile, United States mail, in person or any delivery service. Participating candidates who file applications by facsimile, shall also submit the original application, office of elections affidavit, and other documentation required under subsection (a) within four days.
(d) After a participating candidate is certified as a comprehensive publicly funded candidate, the certification shall apply to both the primary and the general election.
(e) A participating 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) A certified candidate shall comply with the following restrictions on contributions and expenditures, except as authorized by the commission under section 11-K:
(1) Upon certification for comprehensive public funding and until the end of the general election period, a certified candidate shall not accept for use in the campaign:
(A) Contributions from any person; except that the certified candidate may accept in-kind contributions totaling less than $100 from any single person;
(B) Loans from any person, including a loan from the certified candidate; and
(C) Contributions from political parties;
and
(2) Upon certification for comprehensive public funding and until the end of the general election period, a certified candidate shall not expend for campaign purposes:
(A) Any money except public funds issued by the commission;
(B) Public funds for purposes other than those permitted in this subpart;
(C) 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; and
(D) Funds in excess of the public funds, including equalizing funds, allocated to the certified candidate, or incur an obligation to spend in excess of the public funds allotted.
(b) A certified 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-P.
(c) A certified candidate who spends or incurs an obligation to spend more than one hundred per cent of the public funds allocated to the candidate 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 certified candidate and the certified candidate's committee shall furnish complete campaign records, including all records of in-kind contributions, seed money contributions, qualifying contributions to the commission, and expenditures. A certified candidate shall fully cooperate with any audit or examination by the commission.
(b) A certified candidate and the certified candidate's committee shall comply with the reporting requirements of sections 11-194, 11-195, 11-196, 11-212, 11-213, and 11-224 in subpart B in addition to those required under this subpart or as may be required by the commission.
§11-J Comprehensive publicly funded candidates; continuing obligation. (a) A certified candidate shall comply with all requirements under this subpart through the general election campaign period regardless of whether the certified candidate maintains eligibility for comprehensive public funding in the general election campaign period.
(b) Except for seed money contributions and surplus campaign contributions, a certified 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 certified candidate withdraws from seeking nomination for or from the election, or has unspent public funds after an election, all unencumbered public funds shall be returned to the Hawaii election campaign fund within ten days after the general election.
§11-K Amount of base public funding; disbursements; sufficiency of public funding. (a) The base amount of comprehensive public funding for each contested primary and general election 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.
(b) The base amount of public funding for an uncontested primary election shall be thirty per cent of the amount provided in a contested election. The base amount of public funding for an uncontested general election shall be thirty per cent of the amount provided in a contested election, except that if the certified candidate had a contested primary election followed by an uncontested general election, the certified candidate shall receive public funding for both elections at the contested level.
(c) The commission shall disburse public funds by check or electronic transfer:
(1) For the primary election, within two business days after the participating candidate is certified for comprehensive public funding; provided the certified candidate has filed the appropriate nomination papers in accordance with section 12-6, Hawaii Revised Statutes; and
(2) For the general election, within two business days after the office of elections certifies the results of the primary election, except that a certified candidate who does not have a contested primary election shall be entitled to disbursement of public funds within two business days of the primary election.
(d) The base amount of the public funding shall be disbursed in a lump sum based on a contested election, except that:
(1) If the filing deadline for nomination papers has passed, the commission shall disburse the public funds allotted for a contested or uncontested primary election, as applicable; and
(2) A certified candidate who receives public funding at the contested amount for an uncontested primary election before it is known that the primary election is uncontested, shall have the base amount of public funding for the general election offset by the amount received in excess of the thirty per cent allotted for the uncontested primary election.
(e) A certified candidate who is successful in the primary election may use unspent comprehensive public funds for the general election. A certified candidate who is not successful in the primary election shall return all unspent and unencumbered public funds to the Hawaii campaign election fund.
(f) The commission shall not distribute comprehensive public funding to certified candidates that exceeds the total amount of $3,500,000 in a general election year. Commencing on February 1 of a general election year and ending with the deadline to submit applications for certification, the commission shall post on its website a monthly report stating by district, the number of declarations of intent to seek comprehensive public funding received, the number of applications for certification received, the number of candidates who have been certified for comprehensive public funding, the base amount committed to certified candidates and the amount available for additional certified candidates. In the event that the commission determines that there is insufficient funds to meet the base amount of comprehensive public funding for all certified candidates, the commission shall prioritize the funding in the following order:
(1) If funds are insufficient to fund both the primary and general elections, fully fund the base amount for all certified candidates for one election, at the option of the certified candidate; and
(2) If funds are insufficient to fund one election per certified candidate, reduce the base amount for all certified candidates on an equal per cent basis and permit the certified candidate to select the election for public funding.
Notwithstanding any other provisions in this subpart, if the commission determines that the revenues are insufficient to meet distributions to certified candidates under this section, the commission may permit certified candidates to withdraw from the comprehensive public funding program or accept and spend contributions, subject to the campaign contribution limitations set forth in section 11-204, up to the applicable amounts, including equalizing funds, the certified candidate would have received from comprehensive public funding.
§11-L Equalizing funds, sufficiency of funds. (a) When any campaign report shows that the sum of one or more nonparticipating candidates and their candidate's committees' expenditures or obligations, or campaign contributions received or borrowed, whichever is greater, in conjunction with any independent expenditures reported by any noncandidate committee, party or any other person exceeds by twenty-five per cent the base amount of comprehensive public funding allotted to an opposing certified candidate in a contested election, the commission shall issue an amount equal to the reported excess.
(b) Equalizing funds shall be limited to one hundred per cent of the base amount of comprehensive public funding allotted to the certified candidate in a contested election.
(c) Checks for or electronic transfer of equalizing funds shall be issued within five business days of the filing with the commission of any report indicating entitlement to equalizing funds.
(d) Reporting obligations under this section for nonparticipating candidates and their candidate's committees, noncandidate committees, parties or any other persons making independent expenditures shall be in addition to the reporting requirements under this chapter whenever a certified candidate is opposed in a contested election by a nonparticipating candidate as follows:
(1) Commencing thirty days before the primary election day, nonparticipating candidates and their candidate's committees shall file an initial excess report with the commission within forty-eight hours after cumulative contributions received or expenditures are made in an election period that exceed by twenty-five per cent the base amount of comprehensive public funding allotted to an opposing certified candidate in a contested election. Thereafter, nonparticipating candidates and their candidate's committees shall file supplemental excess reports within forty-eight hours after any encumbrances or expenditures exceed $1,000 in aggregate; and
(2) Commencing thirty days before the primary election day, noncandidate committees, parties and any other persons that incur independent expenditures that expressly advocate the nomination, election, or defeat of a certified candidate shall file an independent expenditure report with the commission within forty-eight hours after any independent expenditures exceed $1,000 in aggregate in an election period. Thereafter, noncandidate committees, parties and any other persons that incur independent expenditures shall file supplemental independent expenditure reports within forty-eight hours whenever the aggregate expenditures exceed $1,000. The independent expenditure reports shall identify the nonparticipating candidate or certified candidate for whom the independent expenditure is intended to influence the nomination, election or defeat.
(e) The commission may advance equalizing funds, subject to restrictions on when the equalizing funds may be expended, whenever reports filed by nonparticipating candidates and their candidate's committees indicate that the nonparticipating candidates have raised campaign funds or have surplus campaign funds that exceed the base amount of comprehensive public funding allotted to the certified candidate by more than one hundred per cent.
(f) If a nonparticipating candidate and their candidate's committee fails to file or files a false excess report or supplemental excess reports as required under this section, the commission shall automatically disburse equalizing funds up to the maximum allotted to the opposing certified candidate.
(g) Any nonparticipating candidate and their candidate's committee, noncandidate committee, party or any other person that incurs independent expenditures in a contested election involving a certified candidate who fails to file a report as required under this section or files a false report shall be:
(1) Guilty of a misdemeanor;
(2) Subject to a fine up to three times the amount of equalizing funds paid to the certified candidate; and
(3) Subject to any other fine or penalty pursuant to sections 11-228 and 11-229.
(h) Upon certification of all comprehensive publicly funded candidates, if the commission determines there are insufficient funds to meet the potential need for equalizing funds for all certified candidates, the commission shall:
(1) Reduce the maximum amount of equalizing funds on an equal per cent basis for all certified candidates;
(2) Permit the certified candidate to select the election for which equalizing funds will be received at the reduced maximum per cent amount; and
(3) Permit the certified candidate to accept and spend contributions, subject to the campaign contribution limitations set forth in section 11-204, up to the equalizing funds the certified candidate would have received from comprehensive public funding.
(i) The commission shall adopt rules to compute the amount of equalizing funds allotted to a certified candidate, that take into consideration contributions, surplus campaign funds and expenditures of the nonparticipating candidate and their candidate's committee, and any independent expenditures incurred to influence the nomination, election or defeat of the certified candidate. To prevent the abuse of equalizing funds, 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. The commission shall adopt rules to specify the reporting requirements required by this section and any other rules to implement this section.
§11-M 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 certified 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-N Deposit of and access to comprehensive public funds. (a) All public funds received by a certified 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-O 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 moneys shall be deposited into the Hawaii election campaign fund:
(1) Excess seed money contributions;
(2) Qualifying contributions, including any excess qualifying contributions of certified candidates;
(3) Unspent public funds distributed to any certified candidate;
(4) Fines levied by the commission for violation of this subpart; and
(5) Voluntary donations.
§11-P Violations; penalties. Any candidate who seeks or receives public funding under this subpart who knowingly violates the requirements of this subpart in order to fraudulently qualify for or receive public funding shall:
(1) Have the certification for comprehensive public funding revoked. Upon revocation of certification, the certified candidate shall repay all public funds received within ten business days; and
(2) 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-Q Rules. The commission shall adopt forms and rules pursuant to chapter 91 as may be necessary to implement this subpart, including any restrictions on petty cash expenditures by the certified candidate."
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 partial public funding program pursuant to section 11-221. Qualifying campaign 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, commencing with section 11-218, referred to as the "partial public funding program", and subpart C, commencing with section 11-A referred to as the "comprehensive public funding for state house of representatives elections." 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 11-217.5, Hawaii Revised Statutes, is amended to read as follows:
"§11-217.5 Depletion of fund. (a) The Hawaii election campaign fund shall be under no obligation to provide moneys to [qualified] eligible candidates in the partial public funding program or comprehensive public funding for state house of representatives elections in the event that moneys in that fund have been depleted.
(b) [In] For purposes of the partial public funding program, in the event that the Hawaii election campaign fund is close to depletion, as determined by the commission, the commission shall determine the amounts available to [qualified] eligible candidates based on their order of eligibility in qualifying for partial public funds, as determined by the date of filing of an application for public funds with the commission pursuant to section 11-222; provided that the application has been accepted by the commission.
(c) For purposes of the comprehensive public funding for state house of representatives elections, in the event the Hawaii election campaign fund is close to depletion, the commission shall determine whether that program should be operable in accordance with subpart C."
SECTION 6. Section 11-218, Hawaii Revised Statutes, is amended to read as follows:
"§11-218 [Candidate funding; amounts available.] Partial public funding program; maximum allowed. (a) Public funds from the Hawaii election campaign fund are available to fund eligible candidates who qualify for the partial public funding program in amounts as set forth in this section.
[(a)] (b) The maximum amount of partial 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)] (c) For the office of state senator, state representative, county council member, and prosecuting attorney, the maximum amount of partial 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.
[(c)] (d) For the board of education and all other offices, the maximum amount of partial public funds available to a candidate shall not exceed $100 in any election year.
[(d)] (e) Each candidate who qualified for the maximum amount of partial 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 partial 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 7. Section 11-219, Hawaii Revised Statutes, is amended to read as follows:
"§11-219 Qualifying campaign contributions[;] for partial public funding program; amounts. As a condition of receiving partial public funds for a primary, special primary, or general election, a candidate shall not be unopposed in any election for which partial 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 8. Section 11-220, Hawaii Revised Statutes, is amended to read as follows:
"§11-220 Eligibility for payments[.] under the partial public funding program. (a) To be eligible to receive [payments under section 11-217,] partial public funding from the Hawaii election campaign fund 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] the candidate [which] that the commission may request;
(2) Agree to keep and furnish records, books, and other information [which] that 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,] partial public funding from the Hawaii election campaign fund in accordance with section 11-221, a candidate shall certify to the commission that:
(1) [Such] The candidate and all committees authorized by [such] the candidate shall not incur campaign expenses in excess of the expenditure limitations imposed by section 11-209;
(2) [Such] The candidate has qualified to be on the election ballot in a primary, special primary, or general election;
(3) [Such] The 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] The candidate or committee authorized by [such] the candidate has received the qualifying sum of private contributions for the office sought by the candidate as set forth in section 11-219; and
(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] the candidate in receipt of qualifying campaign contributions which may be taken into account for purposes of partial public funding shall maintain, on a form prescribed by the commission, records which show the date and amount of each [such] qualifying campaign 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] these contributions which the commission may require.
(d) No candidate certified for comprehensive public funding under subpart C shall be eligible for partial public funding under this subpart in a given election period."
SECTION 9. Section 11-221, Hawaii Revised Statutes, is amended to read as follows:
"§11-221 Entitlement to [payments.] partial public funding. Every candidate who is eligible to receive partial 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 partial public funds [must] shall 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] shall have at least one other qualified candidate as an opponent for the primary, special, or general election to receive partial public funds for that election."
SECTION 10. Section 11-222, Hawaii Revised Statutes, is amended by amending its title and subsections (a), (b), and (c) to read as follows:
"§11-222 Candidate funding; application [.] for partial public funds. (a) Application forms for partial public funds shall be adopted by the commission and shall provide for a sworn statement by the candidate that the candidate has established eligibility under section 11-220 to receive payments under section 11-217. Each application shall be accompanied by a qualifying campaign contribution statement or statements, and shall be filed with the commission no later than thirty days after the general election. Upon approval by the commission of the application and qualifying campaign contribution statement, the commission shall direct the comptroller to distribute [matching] partial public funds up to the maximum of the amount of public funds to which the candidate is entitled.
[Public] Partial public funds shall be distributed by the comptroller to each eligible candidate within twenty days from the date of the candidate's initial application with the commission.
(b) Each candidate in receipt of the qualifying sum of campaign contributions established for the candidate's office may apply to the commission for partial public funding after the candidate has become a candidate in a primary, special primary, special, or general election.
(c) The commission shall make additional certifications within two weeks after receiving an application and supplemental contribution statement from an eligible candidate who requests additional partial public funding pursuant to section 11-221."
SECTION 11. Section 11-223, Hawaii Revised Statutes, is amended to read as follows:
"§11-223 Candidate funding; restrictions. (a) Each candidate who accepts partial public [campaign] funds under this subpart shall be required to abide by the campaign spending limits for the candidate's respective office as set forth in section 11-209. Any candidate who exceeds the spending limits for the candidate's respective office as set forth in section 11-209 shall immediately return all of the partial public campaign funds the candidate has received to the Hawaii election campaign fund.
(b) [Public] Partial public campaign funds provided under this subpart shall only be used to:
(1) Defray campaign expenses incurred by and paid for an eligible candidate or all committees authorized by [such] the candidate; and
(2) Repay loans, the proceeds of which were used to defray campaign expenses.
(c) No candidate or committee authorized by a candidate shall be entitled to receive any partial public funds under this subpart unless the candidate has qualified to have the candidate's name on the election ballot in the election for which funds are sought.
(d) In no event shall any candidate or campaign treasurer in receipt of partial public campaign funds transfer any portion of [such] those funds to another candidate for any primary, special primary, special, or general election campaign.
(e) All partial public funds received under this subpart shall be deposited in a financial institution designated to do business in the State. No expenditures of any public funds received under this subpart shall be made except by checks drawn on [such] a checking account. The commission may require [such] reports relating to the expenditure of [such] partial public funds as it considers appropriate.
(f) Each candidate, on the deadline for filing of a final report for any primary, special primary, special, or general election, shall return all unexpended partial public funds to the Hawaii election campaign fund."
SECTION 12. Section 11-224, Hawaii Revised Statutes, is amended to read as follows:
"§11-224 Public funds; report required; return of funds. The campaign treasurer of [the] any candidate who receives public funds under either the partial public funding program or comprehensive public funding for state house of representatives elections shall produce evidence to the commission no later than twenty days after a primary or special primary election; and no later than thirty days after a special or general election that all public funds paid to the candidate have been utilized as required by this subpart.
Should the commission determine that any part of the public funds have been used for noncampaign or improper expenses, it shall report such finding to the attorney general and shall order the candidate to return all or part of the total funds paid to that candidate for a primary, special primary, special, or general election. When such funds are returned, they shall be deposited in the Hawaii election campaign fund."
SECTION 13. Section 11-225, Hawaii Revised Statutes, is amended as follows:
1. By amending its title and subsection (a) to read:
"§11-225 Public funds; examination and audit; payments[.]; penalties. (a) Within sixty days after each general election, the commission shall conduct an examination and audit of all public funds received by [the] any candidate [and of] who received public funds under either the partial public funding program or the comprehensive public funding for state house of representatives elections, including the campaign contributions used for purposes of qualifying for public funding under [this subpart] subparts B and C, and the campaign expenses incurred by all candidates who received [payments] public funding pursuant to [section 11-217.] subparts B and C."
2. By amending subsection (c, (d), (e), and (f) to read:
"(c) Should the commission determine that any payment of partial public funds made to an eligible candidate pursuant to section 11-221 was in excess of the aggregate amount of payments to which [such] the candidate was entitled, the commission shall notify [such] the candidate and [such] the candidate shall pay to the Hawaii election campaign fund a sum equal to the amount of excess payment.
(d) If the commission determines that any amount of any partial public funds made to a candidate under section 11-217 was used for any improper purpose, the commission shall so notify the candidate, and the candidate shall pay to the fund an amount equal to three hundred per cent of such amount.
(e) Any candidate who has received partial public funds under section 11-217 and who is convicted of violating any provision of this subpart shall, upon notification by the commission, pay to the Hawaii election campaign fund the full amount of public funds received by [such] the candidate.
(f) No notification shall be made by the commission under subsection (c) with respect to the payment of excess partial public funds more than two years after the payment of such funds."
SECTION 14. Section 11-228, Hawaii Revised Statutes, is amended as follows:
1. By amending subsection (a) to read:
"(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."
2. By amending subsection (e) to read:
"(e) Any person or the commission may sue for injunctive relief to compel compliance with [this subpart] subparts B and C."
SECTION 15. Section 11-229, Hawaii Revised Statutes, is amended as follows:
1. By amending subsections (a) and (b) to read:
"(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."
2. By amending subsection (d) to read:
"(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."
SECTION 16. 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 2005-2006 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.
The sum appropriated shall be expended by the campaign spending commission for the purposes of this Act.
SECTION 17. The campaign spending commission shall write and publish all forms and receipts 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, district qualifying campaign 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) An examination of mechanisms for increasing revenues of the Hawaii election campaign fund, 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 18. 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 19. 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 20. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 21. This Act shall take effect on July 1, 2040.