Report Title:
Campaign Spending; Comprehensive Public Funding
Description:
Establishes a comprehensive public funding program for candidates for governor, lieutenant governor, and prosecuting attorney who agree to abide by campaign contribution and expenditure limits and meet other criteria. (SD1)
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1713 |
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TWENTY-THIRD LEGISLATURE, 2005 |
H.D. 1 |
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STATE OF HAWAII |
S.D. 1 |
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A BILL FOR AN ACT
relating to campaign spending.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds and declares that:
(1) The pervasive and expanding influence of private contributions and expenditures on public elections in the State of Hawaii undermines democracy and the rights of all Hawaii citizens to vote for the candidate of their choice and to enjoy equal and meaningful participation in the democratic process, rights that are guaranteed by the First and Fourteenth Amendments to the United States Constitution as well as Article I, sections 1, 2, 4, and 8, of the state constitution;
(2) Candidates for statewide office who lack access to personal wealth or wealthy donors are precluded from running a competitive campaign, because their voices are drowned out by those who can afford to saturate their constituents with television, radio, and other expensive mass-media communications, the indispensable instruments of effective political speech in the modern age;
(3) Over the last years, private contributions to statewide campaigns have increased by per cent and independent expenditures made to influence state-wide campaigns have increased per cent. This dramatic influx of private money, coupled with recent high-profile law enforcement investigations and prosecutions of campaign finance abuses have undermined the public's confidence in the political process and fueled the public perception of corruption in Hawaii state politics;
(4) The dominance of private funding in state elections also burdens candidates and elected officials with the incessant rigors of fundraising and decreases the time available to carry out their public responsibilities. Further, private funding creates a danger of actual corruption by compelling elected officials to accept money from private interests that are directly affected by governmental actions; and
(5) The State's existing system of partial public funding for campaigns has not created a viable alternative to private sources of funding. Only nine per cent of candidates statewide participated in the partial public funding system in the 2004 election, in part because the available partial public funding is insufficient to run a competitive campaign.
The State has compelling state interests in preserving the integrity of its democratic system, promoting an open and robust debate on public issues and protecting the constitutional rights of its citizens to the meaningful exercise of their inherent and equal political power. To serve these compelling state interests, the legislature finds and declares that it is essential to provide comprehensive public funding to candidates seeking election to the office of the lieutenant governor, the office of the governor, and the office of the prosecuting attorney who voluntarily agree to abide by campaign contribution and expenditure limits and meet other criteria.
It is the purpose of this Act to create a comprehensive public funding system that will offer a viable and competitive alternative to private funding sources, thereby substantially reducing or eliminating the deleterious effects of private financing described above.
SECTION 2. Chapter 11, Hawaii Revised Statutes, is amended by adding a new subpart C to part XII to read as follows:
"C. COMPREHENSIVE PUBLIC FUNDING FOR ELECTIONS
TO THE OFFICES OF GOVERNOR, LIEUTENANT GOVERNOR, AND PROSECUTING ATTORNEY
§11-A Definitions. When used in this subpart, unless the context clearly requires otherwise:
"Candidate" means an individual who seeks nomination for election or seeks election to the office of governor, lieutenant governor, or prosecuting attorney and who meets the definition of "candidate" in 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 11-191, that makes an expenditure or accepts a contribution on behalf of a candidate for nomination for election, or re-election to the office of governor, lieutenant governor, or prosecuting attorney 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 requirements of 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 candidates for the nomination and, in a general election, the certified candidate is opposed by one or more candidates for election to the office.
"Contribution" shall be as defined in section 11-191.
"Declaration of intent to seek comprehensive public funding" means the form completed by a participating candidate and the filing of which triggers the participating candidate's ability to begin collecting qualifying contributions.
"District" means the entire State for the offices of governor and lieutenant governor or the respective counties for the prosecuting attorney.
"Election period" shall be as defined in section 11-191.
"Equalizing funds" means additional public funds released by the commission to a comprehensive publicly funded candidate to allow the publicly funded candidate to stay 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 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.
"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 candidate 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 candidate or nonparticipating candidate, a candidate's committee, or their agents. For purposes of this definition, "clearly identified" means that the name, likeness, photograph, or drawing of the certified candidate or nonparticipating candidate is used, or the identity of the certified candidate or nonparticipating 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.
"Nonmonetary contribution" means a contribution other than of money that may include goods or services.
"Nonparticipating candidate" means a candidate who does not qualify for or receive public funding during an election period and is involved in a contested election with a certified participating candidate.
"Participating candidate" means a candidate who is seeking certification 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 that originate from the general fund of the State.
"Qualifying contribution" means a $ 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 candidate nomination papers to run in the primary election of a general election year during which a candidate may collect qualifying campaign contributions to qualify for comprehensive public funding under this subpart.
"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 Qualifications for comprehensive public funding for candidates for office of the prosecuting attorney. (a) A candidate may seek comprehensive public funding for the primary election campaign period if the candidate:
(1) Resides in the district from which election is sought as of date of the filing of nomination papers for the primary election in the general election year in which the candidate seeks to be nominated or elected;
(2) Is a registered voter in the district from which election is sought;
(3) Files a declaration of intent to seek comprehensive public funding with the commission between January 1 of the election year and thirty days before the closing date to file nomination papers to run for office for which the candidate intends to seek election;
(4) Collects a $ district qualifying contribution in accordance with section 11-F;
(5) Accepts only the following contributions prior to applying for certification as a comprehensive publicly funded candidate:
(A) Seed money contributions until the candidate files a declaration of intent to run as a comprehensive publicly funded candidate; 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 and a declaration that the candidate has complied and will comply with all of the requirements of this subpart, as applicable.
(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 immediately preceding the general election in which the funds under this subpart are provided; 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-C Qualifications for comprehensive public funding for candidates for the offices of governor or lieutenant governor. (a) A candidate may seek comprehensive public funding for the primary election campaign period if the candidate:
(1) Is a resident of the State as of the date of the filing of nomination papers for the primary election in the general election year in which the candidate seeks to be nominated or elected;
(2) Is a registered voter in the State;
(3) Files a declaration of intent to seek comprehensive public funding with the commission between January 1 of the election year and thirty days before the closing date to file nomination papers to run for office for which the candidate intends to seek election;
(4) Collects a $ district qualifying contribution in accordance with section 11-F;
(5) Accepts only the following contributions prior to applying for certification as a comprehensive publicly funded candidate:
(A) Seed money contributions until the candidate files a declaration of intent to run as a comprehensive publicly funded candidate; 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 and a declaration that the candidate has complied and will comply with all of the requirements of this subpart, as applicable.
(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 immediately preceding the general election in which the funds under this subpart are provided; 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) The use of seed money shall be limited to expenditures necessary to determine whether sufficient support exists for a participating candidate to run for office as a comprehensive publicly funded candidate and may be used to purchase office supplies, rent equipment, send a mailing to district residents, and hold gatherings 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 or expended, or both, by a candidate seeking eligibility for comprehensive public funding for:
(1) Lieutenant governor shall not exceed $ ;
(2) Governor shall not exceed $ ; and
(3) Prosecuting attorney shall not exceed $ ;
provided that an elected official who is a candidate seeking eligibility for comprehensive public funding may collect three times the amount of seed money allowed to be retained or expended, or both, under this subsection; and provided further that the amount of seed money collected by an elected official seeking eligibility for comprehensive public funding shall be retained or expended, or both, as provided under this section; and held in a separate account pursuant to rules adopted by the commission pursuant to chapter 91. All seed money contributions shall be reported to the commission.
(c) Contributions of seed money from any single source shall not exceed $ , 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 $ , $ , or $ limit, as applicable, in subsection (b).
(f) Seed money shall only be spent prior to and during the qualifying period and shall not be collected after the candidate has filed the declaration to run. The candidate may spend seed money until the candidate is certified by the commission as a comprehensive publicly funded candidate.
(g) Any unspent seed money shall be deducted from the initial primary election distribution of a participating comprehensive publicly funded candidate.
(h) A 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) Signature, printed name, home address, zip code, and telephone number of the contributor;
(2) The last four digits of the contributor's social security number for the purposes of verifying voter registration;
(3) Contribution amount or value; and
(4) Date of the contribution.
(i) No comprehensive publicly funded candidate or the candidate's volunteer shall accept seed money from a contributor who makes the contribution under the name of another person. Any comprehensive publicly funded candidate who knowingly violates this subsection shall be fined five times the amount of the contribution, disqualified from receiving comprehensive public funding for that election period, and be subject to any other penalties that may be assessed by the commission pursuant to sections 11-228 and 11-229, or that may otherwise be provided by law.
§11-E Restriction on use of surplus campaign funds. 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 depository account separate from that established for the comprehensive public funds under section 11-N. The comprehensive publicly funded candidate shall continue to file reports on the surplus campaign funds in accordance with subpart B or as otherwise may be required by the commission.
§11-F Qualifying contributions. (a) Each qualifying contribution shall meet the requirements of this section. To be counted as a qualifying contribution:
(1) Any contributor to a candidate for the office of governor or lieutenant governor shall be a registered voter who resides within the State at the time the contribution is given;
(2) Any contributor to a candidate for prosecuting attorney shall be a registered voter who resides within the county at the time the contribution is given; and
(3) A contribution shall be:
(A) In the amount of $ , if paid by check or money order;
(B) Made in cash, 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 certification as a comprehensive publicly funded candidate with the commission.
(c) Any 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 indicate that it is prepared by the campaign spending commission, and shall include:
(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 contribution;
(5) The date the contribution is made; and
(6) The candidate's pledge to abide by the public funding rules and obligations.
(d) The original receipt shall be submitted to the campaign spending commission upon application for certification as a comprehensive publicly funded candidate. A copy shall be retained by the participating candidate, and a copy shall be submitted to the contributor. 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 participating candidate seeking to qualify as a comprehensive publicly funded candidate shall solicit or accept a qualifying contribution made by the contributor in the name of another, who is not the person identified on the receipt. A person who knowingly violates this subsection shall be fined five times the amount of the contribution, disqualified from receiving comprehensive public funding for that election period, and be subject to any other penalties that may be assessed by the commission pursuant to sections 11-228 and 11-229, or that may otherwise be provided by law.
(f) A participating candidate shall submit an alphabetized list of contributors and the date the qualifying contributions were made to the office of elections for verification that every contributor is a registered voter 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 contributions.
§11-G Certification of qualification for comprehensive public funding. (a) Candidates seeking certification as a comprehensive publicly funded candidate shall submit to the commission an application for certification that contains at least:
(1) signatures and contributions for election to the office of lieutenant governor; provided that at least of the signatures and contributions shall be from counties other than the city and county of Honolulu;
(2) signatures and contributions for election to the office of governor; provided that at least of the signatures and contributions shall be from counties other than the city and county of Honolulu; or
(3) signatures and contributions for election to the office of the prosecuting attorney;
from registered voters in the district for which the candidate seeks office no later than thirty days prior to the primary election, signed by the participating candidate and the participating candidate's campaign treasurer under penalty of perjury.
(b) The application shall also include:
(1) The original affidavit from the office of elections certifying and authenticating that the participating candidate's qualifying campaign contributors are all registered voters from the participating candidate's district; and
(2) An alphabetized list of all qualifying campaign contributions and contributors and the receipts given to contributors.
The application form shall be prescribed by the commission.
(c) 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.
(d) The commission shall date and time stamp all applications upon receipt. Applications may be submitted by facsimile, United States mail, in person, or by any delivery service. Participating candidates who file applications by facsimile shall also submit the original application and other original documentation required under this section within four days of filing the facsimile transmission.
(e) After a participating 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.
(f) A candidate who is not certified for comprehensive public funding under this subpart may seek public funding under the public funding program in 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 under section 11-K:
(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 source; provided that the candidate may accept in-kind contributions aggregating less than $ in any single month from any single source;
(B) Loans from any person, including a certified candidate;
(C) Contributions from political parties; and
(D) Any campaign material purchased or held from a date prior to the declaration of intent to run for office as a comprehensive publicly funded candidate; and
(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) Public funds for purposes other than those permitted in this subpart;
(C) Public funds outside the applicable campaign period for which the funding is allocated, except for proper campaign debts incurred but not paid; and
(D) Public funds in excess of the comprehensive public funds allocated to the candidate, including equalizing funds, or incur an obligation or obligations to spend public funds in excess of this amount.
(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 under this subpart shall repay to the Hawaii election campaign fund an amount equal to three times the excess expenditures.
§11-I Comprehensive publicly funded candidates; reporting. (a) Comprehensive publicly funded candidates and the certified candidate's committee shall furnish complete campaign records, including all records of nonmonetary contributions, seed money contributions, qualifying campaign contributions to the commission, and expenditures. Candidates shall fully cooperate with any audit or examination by the commission.
(b) Comprehensive publicly funded candidates shall comply with the reporting requirements of sections 11-194, 11-195, 11-196, 11-212, 11-213, and 11-224 in addition to those required under this subpart or that may be required by the commission.
(c) The commission shall require that all certified candidates file the reports required under this subpart in a digital, electronic format specified by the commission.
§11-J Comprehensive publicly funded candidates; continuing obligation. (a) A certified candidate shall comply with all requirements applicable to a comprehensive publicly funded candidate 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 qualifying contributions, a certified candidate who is elected to the office sought shall not accept private contributions from any person, political party, or political action committee until either September 1 of the next odd-numbered year following the general election in which the candidate was last elected.
(c) If a certified candidate withdraws from seeking the nomination for or from the election, or has unspent public funds after an election, all unencumbered funds received by the candidate under this subpart shall be returned to the commission and within ten days after the general election to placed in the general fund of the State.
§11-K Amount of base public funding; disbursements; sufficiency of public funding. (a) For governor and lieutenant governor elections, the base amount of comprehensive public funding for each contested primary and general election shall be set at an average of the amount spent by winning candidates in the previous two gubernatorial and lieutenant gubernatorial elections statewide, reduced by per cent. For prosecuting attorney elections, the base amount of comprehensive public funding for each contested primary and general election shall be set at an average of the amount spent by the winning candidates in the previous two elections for prosecuting attorney, reduced by per cent.
(b) The base amount of public funding for an uncontested primary election shall be per cent of the amount provided in a contested election as determined under subsection (a). No funding shall be allocated in an uncontested general election.
(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 that the certified candidate has filed the appropriate nomination papers in accordance with section 12-6; 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; provided 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 per cent allotted for the uncontested primary election under subsection (b).
(e) If the winning primary candidate has residual funds from the primary election, those funds may be carried over to the general election. A certified candidate who is not successful in the primary election shall return all unspent and unencumbered public funds to the commission within ten days after the primary election to be placed in the general fund of the State.
(f) The commission shall not distribute comprehensive public funding to certified candidates that exceeds the total amount of $ in a general election year that has no gubernatorial election or $ in a general election year that has a gubernatorial election. 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.
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 shall permit certified candidates to 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) The commission shall disburse equalizing funds to a certified candidate in a contested election whenever any campaign report filed pursuant to subpart B shows that the sum of an opposing nonparticipating candidate and the candidate's committee expenditures or obligations, or campaign contributions received or borrowed, whichever is greater, added to any independent expenditures made in support of that nonparticipating candidate or against the opposing certified candidate reported by any noncandidate's committee, party or any other person exceeds one hundred per cent of the amount of comprehensive public funding previously allotted and distributed to the opposing certified candidate in a contested election, including any equalizing funds previously distributed. The equalizing funds shall constitute the amount necessary to equalize the opposing certified candidate's funds with the funds of the nonparticipating candidate and the candidate's committees' expenditures, obligations or campaign contributions received or borrowed, when added to any independent expenditures made in support of that nonparticipating candidate or against the certified candidate reported to the commission.
(b) Equalizing funds shall be limited to per cent of the base amount of comprehensive public funding allotted to the certified candidate in a contested election.
(c) If the election will be decided in the primary election, equalizing funds shall be limited to a maximum of
per cent of the base amount of comprehensive public funding allotted to a certified candidate in a contested election.
(d) The commission shall electronically transfer equalizing funds to a certified candidate within twenty-four hours of the filing with the commission of the report indicating the certified candidate's entitlement to equalizing funds.
(e) 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 forty-five days before the primary election day, nonparticipating candidates and their candidate's committees shall file an initial excess report with the commission within twenty-four hours after cumulative contributions received or expenditures are made or committed to be made, including verbal commitments, in an election period that exceed
per cent of 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 twenty-four hours after any encumbrances or expenditures exceed $ in aggregate; and
(2) Commencing forty-five days before the general 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 twenty-four hours when expenditures exceed $ in aggregate in an election period. Thereafter, noncandidate committees, parties, and any other persons that incur independent expenditures, including verbal expenditure commitments, shall file supplemental independent expenditure reports within twenty-four hours whenever the aggregate expenditures exceed $ . 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.
(f) If a nonparticipating candidate and the candidate's committee fails to file or files a false excess report or supplemental excess report as required under subsection (e), the commission, within twenty-four hours of verifying the failure or falsity, shall automatically disburse equalizing funds to any opposing certified candidate up to the maximum authorized under subsections (b) and (c).
(g) Any nonparticipating candidate and the candidate's committee, noncandidate committee, party, or any other person that makes independent expenditures in a contested election involving a certified candidate who fails to file a report as required under this subpart or files a false report shall be:
(1) Guilty of a misdemeanor;
(2) Subject to a fine of 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 public funds to meet the potential need for equalizing funds for all certified candidates, the commission shall permit each certified candidate to accept and spend private 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 under chapter 91 to compute the amount of equalizing funds allotted to a certified candidate that take into consideration the contributions and expenditures of the nonparticipating candidate and the 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.
§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 website 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;
(8) Campaign headquarters rental, salaries, and costs for independent contractors that in the aggregate do not exceed twenty per cent of the allocated comprehensive public funds; and
(9) Travel expenses, including gas, car rental, and airfare.
(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 noncampaign-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 Violations; penalties. Any candidate who seeks or receives comprehensive 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;
(2) Be disqualified as a candidate for or shall forfeit elective public office; and
(3) 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-P Rules. The commission shall adopt forms and rules pursuant to chapter 91 as may be necessary to implement this subpart, including reporting requirements of section 11-L and any restrictions on petty cash expenditures by the certified candidate."
SECTION 3. Section 11-204, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) (1) No person or any other entity shall make contributions to:
(A) A candidate seeking nomination or election to a two-year office or to the candidate's committee in an aggregate amount greater than $2,000 during an election period;
(B) A candidate seeking nomination or election to a four-year statewide office or to the candidate's committee in an aggregate amount greater than $6,000 during an election period; and
(C) A candidate seeking nomination or election to a four-year nonstatewide office or to the candidate's committee in an aggregate amount greater than $4,000 during an election period[.] , except as provided in subparagraph (D).
(D) A candidate seeking nomination or election to the office of prosecuting attorney or the candidate's committee in an aggregate amount greater than
$ during an election period.
These limits shall not apply to a loan made to a candidate by a financial institution in the ordinary course of business.
(2) For purposes of this section, the length of term of an office shall be the usual length of term of the office as unaffected by reapportionment, a special election to fill a vacancy, or any other factor causing the term of the office the candidate is seeking to be less than the usual length of term of that office."
SECTION 4. Section 11-209, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
(a) From January 1 of the year of any primary, special, or general election, the total expenditures for each election for candidates who voluntarily agree to limit their campaign expenditures, inclusive of all expenditures made or authorized by the candidate alone and all campaign treasurers and committees in the candidate's behalf, shall not exceed the following amounts expressed respectively multiplied by the number of voters in the last preceding general election registered to vote in each respective voting district:
(1) For the office of governor--$2.50;
(2) For the office of lieutenant governor--$1.40;
(3) For the office of mayor--$2.00;
(4) For the offices of state senator, state representative, and county council member[, and prosecuting attorney]--$1.40; [and]
(5) For the office of the prosecuting attorney—75 cents; and
[(5)] (6) For the offices of the board of education and all other offices--20 cents."
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.
(c) For the office of the prosecuting attorney, the maximum amount of public funds available to a candidate in any election shall be 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 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 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 means meeting the qualifying campaign contribution requirements of section 11-219."
SECTION 6. Section 11-221, Hawaii Revised Statutes, is amended to read as follows:
§11-221 Entitlement to payments. (a) 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 contribution received by that candidate or candidate committee during the matching payment period involved. A qualifying 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.
(b) A candidate for the office of prosecuting attorney for each respective county who participates in the public funding program shall obtain a minimum amount of qualifying contributions set forth in section 11-219, one time for the election period. After the candidate obtains the minimum amount of qualifying campaign contributions set forth in section 11-219, the candidate is entitled to receive for each election that the candidate's name appears on the ballot:
(1) The minimum payment in an amount equal to the qualifying campaign contributions; and
(2) Payments of $ for each $ of qualifying contributions in excess of the minimum amount of qualifying contributions;
except that the candidate shall not receive more than the maximum amount of public funds available to a candidate pursuant to section 11-218; and the candidate shall not receive public funds for a primary election if the candidate does not obtain the minimum amount of qualifying contributions before the date of the primary election."
SECTION 7. 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 or 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,] subparts (B) or (C), 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] committed 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 8. 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 or 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 or 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 or 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 9. There is appropriated out of the Hawaii election campaign fund the sum of $ , or so much thereof as may be necessary for fiscal year 2005-2006, for the campaign spending commission to provide additional staff positions and other assistance to support publicly funded elections for the office of governor, lieutenant governor, or prosecuting attorney as follows:
(1) staff positions for computer analysis of campaign contributions for auditing and monitoring and the creation of an online digital filing system for campaign spending reports for all candidates running for lieutenant governor, governor, and prosecuting attorney;
(2) staff position to administer the comprehensive public funding program;
(3) staff position to enforce the comprehensive public funding program; and
(4) Funding for the office of elections, or its designate, to verify the qualifying contributions from registered voters in a candidate's district.
SECTION 10. The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.
SECTION 11. There is appropriated out of the general revenues of the State of Hawaii the sum of $ , or so much thereof as may be necessary for fiscal year 2005-2006, for the disbursement of public funds to qualified publicly funded candidates.
SECTION 12. The sum appropriated shall be expended by the department of accounting and general services for the purposes of this Act.
SECTION 13. 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 shall establish an independent, bi-partisan review committee to undertake a substantive review of the functioning of the comprehensive public funding program established under this Act following the 2006 election. The review committee shall report to the legislature no later than twenty days prior to the convening of the 2007 regular session on the following:
(1) 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;
(2) Suggested amendments to this Act that will extend publicly funded campaigns to other state and county elections;
(3) A summary and evaluation of the commission's activities and recommendations to enhance the effective and timely administration and enforcement of this Act; and
(4) 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 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 July 1, 2005.