SB104: Bill Text Engrossed

LRB-4824/1

RJM&JTK:kmg:kjf

2001 - 2002 LEGISLATURE

Engrossed 2001 Senate BILL 104

January 30, 2002 - Printed by direction of Senate Chief Clerk.

SB104-engrossed,2,18 An Act to repeal 11.01 (12s), 11.05 (3) (o), 11.26 (9) (c), 11.265, 11.31 (2m), 11.50 (2) (h), 11.50 (2) (i) and 11.50 (3); to renumber 11.05 (2r) (title), 11.24 (2), 11.50 (1) (a) 1. and 11.50 (1) (a) 2.; to renumber and amend 11.05 (1), 11.05 (2), 11.05 (2r), 11.12 (6), 11.26 (9) (a), 11.26 (9) (b), 11.50 (9), 19.49 (5) and 19.59 (7); to amend 5.02 (13), 7.08 (2) (c) and (cm), 8.10 (3) (intro.), 8.15 (6) (intro.), 8.20 (4), 8.30 (2), 8.35 (4) (a) 1. a. and b., 8.35 (4) (c) and (d), 11.05 (3) (c), 11.05 (5), 11.05 (12) (b), 11.05 (13), 11.06 (1) (intro.), 11.06 (1) (e), 11.06 (2), 11.06 (4) (b), 11.06 (5), 11.06 (7m) (a), 11.06 (7m) (c), 11.06 (11) (c), 11.07 (1), 11.07 (5), 11.09 (3), 11.10 (1), 11.12 (2), 11.12 (4), 11.12 (5), 11.14 (3), 11.16 (2), 11.16 (5), 11.19 (title), 11.19 (1), 11.20 (1), 11.20 (7), 11.20 (9), 11.20 (10) (a), 11.20 (12), 11.21 (2), 11.21 (15), 11.21 (16), 11.22 (3), 11.23 (1), 11.23 (2), 11.25 (2) (b), 11.26 (1) (intro.), 11.26 (2) (intro.), 11.26 (2) (a), 11.26 (4), 11.26 (8), 11.26 (10), 11.26 (12m), 11.31 (1) (intro.), 11.31 (1) (a) to (d), 11.31 (1) (e) and (f), 11.31 (2), 11.31 (3), 11.38 (1) (a) 2., 11.38 (6), 11.38 (8) (b), 11.50 (2) (a), 11.50 (2) (b) 5., 11.50 (2) (c), 11.50 (2) (g), 11.50 (5), 11.50 (6), 11.50 (9) (title), 11.50 (11) (a), 11.50 (11) (e), 11.60 (4), 11.61 (1) (a), 19.53 (6), 19.59 (8) (c), 20.510 (1) (q), 25.42, 71.10 (3) (a) and 71.10 (3) (b); to repeal and recreate 11.05 (9) (title) and 11.50 (4); and to create 7.08 (2) (cs), 11.001 (2m), 11.01 (16) (a) 3., 11.05 (1) (b), 11.05 (2) (b), 11.05 (3) (m), 11.05 (3) (r), 11.06 (2m) (b) to (d), 11.12 (2m), 11.12 (6) (c) and (d), 11.12 (8) and (9), 11.20 (2s), 11.20 (2t), 11.24 (1w), 11.24 (4), 11.26 (2) (ad) to (au), 11.26 (8m), 11.26 (9) (a) 1. to 7., 11.26 (9) (b) 1. to 7., 11.31 (1) (de), 11.31 (1m), 11.31 (3p), 11.31 (9), 11.50 (1) (a) 1. (intro.), 11.50 (1) (a) 2m., 11.50 (1) (am), 11.50 (1) (bm) and (cm), 11.50 (2) (j), 11.50 (2m), 11.50 (2s), 11.50 (2w), 11.50 (4m), 11.50 (9) (b), (ba) and (bb), 11.50 (14), 11.60 (3s) and (3t), 13.625 (3m), 19.42 (3m), (4g) and (4r), 19.45 (13), 19.49 (1m), 19.49 (5) (b), 19.535, 19.59 (1) (br), 19.59 (7) (b), 19.59 (8) (cm) and (cn), 20.855 (4) (ba) and 806.04 (11m) of the statutes; relating to: campaign financing, official action in return for providing or withholding political contributions, services, or other things of value, lobbying regulation, designations for the Wisconsin election campaign fund by individuals filing state income tax returns, staffing of the elections board, providing exemptions from emergency rule procedures, granting rule-making authority, making appropriations, and providing penalties.

Analysis by the Legislative Reference Bureau

Engrossment information:

The text of Engrossed 2001 Senate Bill 104, as ordered to a third reading on January 29, 2002, consists of Senate Substitute Amendment 1, as adopted in the senate on that date, as affected by the following Senate Amendments adopted in the senate on that date: Senate Amendments 1, 2, 3, 5, and 6 (as affected by chief clerk's correction).

Senate Amendments 3 and 6 both affect proposed s. 11.50 (9) (b). This bill reflects the effect of both amendments, which causes certain cross-references to be omitted.

Senate Amendment 2 affects the version of proposed s. 11.50 (9) (b) that was deleted by Senate Amendment 6. As a result, the treatment from Senate Amendment 2 is not included in this bill.

Content of Engrossed 2001 Senate Bill 104:

This bill makes numerous changes in the campaign financing law. The bill also makes changes to the income tax laws and to the staffing of the elections board. Significant changes include:

Filing of campaign finance reports

Exemptions from registration and reporting

Currently, any individual who accepts contributions, makes disbursements, or incurs obligations, and any committee or group that makes or accepts contributions, makes disbursements, or incurs obligations, in connection with one or more elections for state or local office or one or more state or local referenda exceeding $25 cumulatively within a calendar year is potentially subject to requirements to register with the appropriate filing officer and to file campaign finance reports.

This bill provides that an individual who accepts contributions, makes disbursements, or incurs obligations or a group that makes or accepts contributions, makes disbursements, or incurs obligations in connection with one or more referenda is not subject to registration and reporting requirements until the individual or group engages in activity exceeding $100 cumulatively within a calendar year.

The bill also permits an individual or committee to claim an exemption from reporting requirements if the individual or committee does not accept contributions, make disbursements, or incur obligations exceeding $1,000 cumulatively within a calendar year with respect to an election for state office, and does not accept contributions exceeding $100 from a single source cumulatively within a calendar year. If an individual or committee does not accept contributions, make disbursements, or incur obligations with respect to an election for any state office but accepts contributions, makes disbursements, or incurs obligations with respect to an election for local office, the bill permits the individual or committee to claim an exemption from reporting requirements only if the individual or committee does not accept contributions, make disbursements, or incur obligations exceeding $100 cumulatively within a calendar year.

Electronic filing

Currently, reports under the campaign finance law must be filed by certain dates specified by law and must cover time periods specified by law. Candidates for state office or their personal campaign or authorized support committees and other individuals, committees, and groups supporting or opposing candidates for state office or statewide ballot questions file their reports with the state elections board. Each registrant for whom the elections board serves as a filing agency and who or that accepts contributions in a total amount or value of $20,000 or more during a campaign period, or a biennial period for a registrant other than a candidate or personal campaign or support committee, must file reports with the board electronically. Any registrant who or that files a report electronically must also file a copy of the report recorded on a medium prescribed by the board.

This bill requires each committee that is currently required to file its campaign finance reports electronically to file those reports within 24 hours after a reportable transaction occurs. Under the bill, once a registrant becomes subject to an electronic reporting requirement, the requirement continues to apply until a termination report is filed, regardless of the level of continuing financial activity of the registrant. In accordance with current law, the bill also requires registrants who file electronically to file copies of reports, at the times currently prescribed by law, recorded on a medium prescribed by the board. The change applies effective with reports filed on or after the day on which the bill becomes law.

Mass media activities

Currently, individuals who accept contributions, organizations that make or accept contributions, and individuals who or organizations that incur obligations or make disbursements for the purpose of influencing an election for state or local office are generally required to register with the appropriate filing officer and to file financial reports with that officer, regardless of whether they act in conjunction with or independently of any candidate who is supported or opposed.

With certain exceptions, this bill imposes registration and reporting requirements, in addition, upon any individual who and organization that, within 60 days of an election and by means of communications media, makes communications which include a reference to a candidate at that election, an office to be filled at that election, or a political party. The bill, however, does not require registration and reporting if the communication is made by a corporation, cooperative, or nonpolitical voluntary association and is limited to the corporation's, cooperative's, or association's members, shareholders, or subscribers.

Special reporting by certain registrants

Currently, a committee making contributions or a candidate or other individual or committee accepting contributions, making disbursements, or incurring obligations in support of or opposition to a candidate is generally required to file a report no later than the eighth day before a primary or election at which the candidate seeks nomination or election to office. The report must disclose contributions made or accepted, disbursements made, and obligations incurred through the 14th day prior to the primary or election. Currently, if a candidate for state office receives one or more contributions from a single contributor aggregating $500 or more during the 14-day period preceding an election, the candidate must report to the elections board the information currently required to be disclosed pertaining to contributions received by the candidate no later than 24 hours following receipt of any such contribution or contributions.

This bill requires each candidate at the general or a special election for a major state office (the office of governor, lieutenant governor, attorney general, secretary of state, state treasurer, superintendent of public instruction, justice of the supreme court, state senator, or representative to the assembly) who does not accept a public grant (see below) and who makes any disbursement after the candidate has accumulated cash in his or her campaign depository or has made disbursements in his or her campaign exceeding a combined total of 75% of the amount of the disbursement limitation for the office that the candidate seeks, to file daily reports, by electronic mail or facsimile transmission, with the elections board and with each candidate whose name appears on the ballot for the office in connection with which the disbursement is made. The daily reports may be filed no later than 24 hours after each disbursement is made, and must include the information that is currently required to be reported pertaining to disbursements made by candidates. The daily reports must be filed during the time period beginning with the later of the date of the disbursement that triggers the requirement or the 7th day after the applicable primary election or the date that a primary would be held, if required, and ending with date of the election at which the candidate seeks office.

This bill also creates additional reporting requirements, applicable to certain special interest committees. Under the bill, reporting may be required of any special interest committee, other than a conduit, that intends to receive any contribution, make any disbursement, or incur any obligation to make a disbursement (as currently defined) independently of a candidate for the purpose of advocating the election or defeat of a clearly identified candidate for a major state office at the general or a special election or any applicable primary election. In addition, reporting may be required of any special interest committee, other than a conduit, that intends to receive any contribution, make any disbursement, or incur any obligation to make any other expenditure independently of a candidate for the purpose of making communications, within 60 days of an election and by means of communications media, which include a reference to a candidate at that election, an office to be filled at that election, or a political party. These additional reporting requirements do not apply to communications that are made by a corporation, cooperative, or nonpolitical voluntary association and that are limited to the corporation's, cooperative's, or association's members, shareholders, or subscribers.

Under the bill, the special interest committee must file these additional reports on the 63rd, 42nd, and 21st day prior to the applicable election, and in the case of a special election, on the 21st day prior to that election. The reports must specify the name of each candidate who is supported or whose opponent is opposed and the total amount of contributions to be received, disbursements or other expenditures to be made, and obligations to be incurred for that purpose during the 21-day period following the date on which the report is due to be filed. The bill also requires additional reports to be filed on the 39th and 18th days preceding each general election and the 18th day preceding each special election, itemizing the actual contributions transferred and received, disbursements made, and obligations incurred for the applicable 21-day period.

Timeliness in filing reports

Currently, where a requirement is imposed under the campaign finance law for filing of a report by a specified date, the requirement may be satisfied by depositing the report with the U.S. postal service no later than the date provided by law for receipt of the report.

This bill permits satisfaction of the filing requirement only by delivering a report to the appropriate filing officer or agency on or before the date provided by law for receipt of the report or by depositing the report with the U.S. postal service no later than the third day before that date.

Disbursement limitations and independent disbursements

Under current law, disbursement (expenditure) levels are specified for candidates for various state and local offices. These levels become a binding limitation upon any candidate for state office who accepts a state grant from the Wisconsin election campaign fund or who agrees to be bound by the limitation, unless the candidate is opposed by a major opponent who could have qualified for a grant but declines to accept one. A candidate for state office who accepts a grant from the Wisconsin election campaign fund and who agrees to be bound by the disbursement limit applicable to the office which the candidate seeks may receive a grant equal to 45% of that disbursement limit, less certain committee contributions accepted by the candidate, if there are sufficient moneys in the fund to finance the full amount of grants for which candidates qualify.

Current law also imposes registration and financial reporting requirements on committees and individuals making disbursements independently of a candidate in support of or in opposition to a candidate for a state or local office. One requirement is the obligation of the committee or individual to file reports with the appropriate filing officer within 24 hours of making such a disbursement, if the disbursement is made less than 15 days before a primary or election and if the cumulative amount of such disbursements exceeds $20.

This bill:

1. Revises the current disbursement levels applicable to candidates for the offices shown in the following chart: - See PDF for table

2. Increases the total disbursement limitation for a candidate for partisan office at a general or special election whose name appears on the ballot at a primary election, who receives less than twice as many votes at that election as another candidate for the same office within the same party, and who has an opponent at the general or special election who received at least 6% of the votes cast for all candidates for that office at the primary election. Under the bill, the increased disbursement limitation is 120% of the amount provided for the candidate receiving the greatest number of votes for that office.

3. Creates a biennial cost-of-living adjustment that causes the statutory disbursement levels to be adjusted biennially, beginning in 2004, in accordance with a formula tied to the "consumer price index" determined by the U.S. department of labor.

4. Replaces the provision requiring reports of cumulative independent disbursements exceeding $20 made later than 15 days prior to a primary or election with a provision that requires cumulative independent disbursements or obligations exceeding $20 during that period to be so reported.

5. Increases the disbursement limitation of any candidate who accepts a public grant by: a) an amount equal to any independent disbursements or independent expenditures other than disbursements made by special interest committees in close proximity to the election for the purpose of making certain mass communications that are made to oppose that candidate, or to support that candidate's opponent, if that amount exceeds 10% of the disbursement limitation for the office that the candidate seeks; and b) the total amount of disbursements exceeding the amount of the disbursement limitation for that office made by any opposing candidate who does not accept a public grant.

6. Repeals the procedure by which a candidate who would not otherwise be subject to statutory disbursement limitations may voluntarily agree to comply with these limitations.

7. Repeals the exemption from disbursement limitations that currently applies to any candidate who accepts a grant from the Wisconsin election campaign fund and who is opposed by a major opponent who could have qualified for a grant but declines to accept one. Under the bill, the candidate accepting the grant remains bound by the applicable disbursement limitations.

Contribution limitations

Under current law, committees other than political party committees and legislative campaign committees are subject to limitations on the amount of contributions made cumulatively to a particular candidate. A committee may contribute up to $43,238 to a candidate for statewide office. Current law also limits the cumulative amount of contributions that a committee may make annually to a particular political party, limits the cumulative amount of contributions that a political party may accept annually from a particular committee, and limits the aggregate total of contributions that a political party may accept during any biennium from all committees. Currently, a committee may annually contribute up to $6,000 to a particular political party, a political party may annually accept up to $6,000 from a particular committee, and a political party may accept up to $150,000 in contributions from all committees during any biennium.

This bill establishes specified limitations on committee contributions to candidates for statewide office as follows: a) candidates for governor, $45,000; b) candidates for lieutenant governor, $15,000; c) candidates for attorney general, $25,000; and d) candidates for secretary of state, state treasurer, superintendent of public instruction, or justice of the supreme court, $10,000. Under the bill, the limitation on committee contributions to a particular political party, and on the annual amount that a political party may accept from a particular committee, is increased to $18,000, and the aggregate limitation on contributions that a political party may accept during a biennium from all committees is increased to $450,000.

Under current law, the aggregate contributions accepted by a candidate for state or local office from all committees, when combined with any grant received from the Wisconsin election campaign fund, may not exceed 65% of the disbursement level or limitation for the office that the candidate seeks. In addition, the contributions received by a candidate for state or local office from all committees other than political party or legislative campaign committees, when combined with any grant received from the Wisconsin election campaign fund, may not exceed 45% of the disbursement level or limitation for the office that the candidate seeks. This bill provides instead that the aggregate contributions accepted by a candidate for state or local office from all political party committees may not exceed the following: - See PDF for table

In addition, the bill provides that the aggregate contributions received by a candidate for state or local office from all committees other than political party committees may not exceed the following: - See PDF for table

Treatment of legislative campaign committees

Currently, the adherents of any political party in either house of the legislature may organize a "legislative campaign committee" to support the candidacy of members of their party for legislative office. Committees other than legislative campaign committees and political party committees are generally subject to a limitation upon the contributions that they may make to candidates for legislative office or to political parties. Legislative campaign committees are subject only to overall limitations on the aggregate contributions that may be accepted by a candidate from entities other than individuals.

This bill eliminates the special status of legislative campaign committees, thus causing them to be treated in the same manner as other special interest committees for the purpose of contribution limitations.

Other contribution restrictions

This bill creates the following new prohibitions on contributions:

1. It prohibits contributions to incumbents who are seeking reelection to a partisan state office from the first Monday in January of each odd-numbered year through the enactment of the biennial budget act. The prohibition does not apply to contributions made to an incumbent who is subject to a recall election from the date on which the petition for a recall election is filed until the date of the recall election.

2. It prohibits any committee from making a contribution to any special interest committee. The prohibition does not apply to a committee that is affiliated with a labor organization that transfers a contribution to another committee that is affiliated with the same labor organization.

3. It prohibits an elective state official or personal campaign committee of an elective state official from soliciting a lobbyist or principal (person who employs a lobbyist) to arrange for another person to make a contribution to that official or personal campaign committee or to another elective state official or the personal campaign committee of that official.

Currently, if a registrant receives a contribution, the registrant must deposit the contribution in its campaign depository account no later than the end of the fifth business day commencing after receipt, unless the registrant returns the contribution before that time. A registrant must report the occupation and principal place of employment of any individual who makes any contribution or contributions to a registrant exceeding $100 in amount or value cumulatively within a calendar year. This bill provides that whenever a registrant receives a contribution in the form of money the registrant must obtain this information from a contributor, if required, before depositing the contributor's contribution in its campaign depository account. Under the bill, if the registrant does not obtain the required information within the period prescribed for making deposits, the registrant must return the contribution.

Contributions through conduits

Currently, if an individual or organization receives a political contribution consisting of money and transfers the contribution to another individual or organization without exercising discretion as to the amount to be transferred and the individual to whom or the organization to which the transfer is made, the contribution is considered to be made by the original contributor for purposes of reporting by the ultimate recipient. The contribution is also treated as an individual contribution for purposes of determining compliance with contribution limitations and qualifying contributions for public grants. The individual or organization making the transfer is called a "conduit" under the law. In most cases, a conduit is required to register and file campaign finance reports unless the conduit does not transfer any contributions to candidates or to personal campaign, legislative campaign, or political party committees.

This bill treats a contribution of money transferred by a conduit as a contribution from the conduit rather than from the individuals contributing to the conduit and applies the same limitations on the amounts of conduit contributions to candidates as apply to committee contributions to candidates. The change does not affect aggregate limitations on the amounts of contributions that candidates may accept from committees.

Disposition of residual or excess funds

Under current law, residual funds remaining when a person who is required to register under the campaign financing law disbands or ceases incurring obligations, making disbursements, or accepting contributions or excess funds received by a registrant that may not be legally expended may generally be used for any lawful political purpose, returned to the original contributors, or donated to a charitable organization or the common school fund.