HB852 HD1.DOC

SECTION 1. The legislature finds that strong and consistent enforcement of Hawaii's ethics laws is necessary to maintain the public's trust in government officials. The legislature further finds that the administrative fines that the state ethics commission may impose upon individuals for failing to timely file financial disclosure statements have not been adjusted for inflation in decades. The fine currently imposed upon a state legislator, employee, or constitutional convention delegate for failing to timely file a financial disclosure statement was set in 1997 at $50; an equivalent fine would be over $79 in 2016 dollars. This Act increases the fine to $75 to account for inflation. The fine currently imposed upon a candidate for state elective office for failing to timely file a financial disclosure statement was set in 1995 at $25; an equivalent fine would be approximately $40 in 2016 dollars. This Act increases the fine to $50.

The legislature also finds that, in 2016, pursuant to existing law, the state ethics commission sent nearly one hundred letters by registered mail, return receipt requested, to notify individuals of their failure to timely file financial disclosure statements. The state ethics commission paid more than $1,000 for postage for those letters, at a cost of $14.87 per letter. The legislature further finds that the expense of sending the notification letters by registered mail, return receipt requested, is no longer justified, and that it is sufficient for the state ethics commission to send these notifications to users' state e-mail accounts or by first-class mail.

Accordingly, the purpose of this Act is to provide additional clarity and consistency in the administration and enforcement of Hawaii's ethics laws, and to promote integrity in state government, by:

(1) Increasing fines for failure to timely file financial disclosure statements;

(2) Allowing the state ethics commission to notify, by e‑mail or first-class mail rather than by registered mail with return receipt requested, those individuals who fail to timely file their financial disclosure statements; and

(3) Directing the state ethics commission to publish the names of individuals who fail to file their financial disclosure statements by the statutory deadline.

SECTION 2. Section 84-17, Hawaii Revised Statutes, is amended by amending subsections (i) and (j) to read as follows:

"(i) Failure of a legislator, a delegate to the constitutional convention, or employee to file a disclosure of financial interests as required by this section shall be a violation of this chapter. Any legislator, delegate to a constitutional convention, or employee who fails to file a disclosure of financial interests when due shall be assessed an administrative fine of [~~$50.~~] $75. The commission, upon the expiration of the time allowed for filing, shall release to the public a list of all persons who have failed to file financial disclosure statements. The [~~state ethics~~] commission shall notify a person, by [~~registered mail, return receipt requested,~~] electronic mail to the person's state e-mail address or first-class mail, of the failure to file, and the disclosure of financial interests shall be submitted to the commission not later than 4:30 p.m. on the tenth day after notification of the failure to file has been mailed to the person. If a disclosure of financial interests has not been filed within ten days of the due date, an additional administrative fine of $10 for each day a disclosure remains unfiled shall be added to the administrative fine. All administrative fines collected under this section shall be deposited in the State's general fund. Any administrative fine for late filing shall be in addition to any other action the commission may take under this chapter for violations of the state ethics code. The commission may waive any administrative fines assessed under this subsection for good cause shown.

(j) The chief election officer, upon receipt of the nomination paper of any person seeking a state elective office, including the office of delegate to the constitutional convention, shall notify the ethics commission of the name of the candidate for state office and the date on which the person filed the nomination paper. The [~~ethics~~] commission, upon the expiration of the time allowed for filing, shall release to the public a list of all candidates who have failed to file financial disclosure statements and shall immediately assess a late filing penalty fee against those candidates of [~~$25~~] $50, which shall be collected by the [~~state ethics~~] commission and deposited into the general fund. The [~~ethics~~] commission may investigate, initiate, or receive charges as to whether a candidate's financial disclosure statement discloses the financial interests required to be disclosed. After proceeding in conformance with section 84-31, the [~~ethics~~] commission may issue a decision as to whether a candidate has complied with section 84-17(f) and this decision shall be a matter of public record."

SECTION 3. The state ethics commission, in its discretion, may make any changes that it deems necessary to internal procedures or forms to aid in the implementation of this Act.

SECTION 4. 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 that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 5. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2050.

HOUSE OF REPRESENTATIVES	H.B. NO.	852
TWENTY-NINTH LEGISLATURE, 2017		H.D. 1
STATE OF HAWAII