82R673 CAE-F

By: Strama H.B. No. 226

A BILL TO BE ENTITLED

AN ACT

relating to limits on political contributions and expenditures in connection with certain legislative and executive offices; providing civil and criminal penalties.

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

SECTION 1. Chapter 253, Election Code, is amended by adding Subchapter G to read as follows:

SUBCHAPTER G. TEXAS CAMPAIGN FAIRNESS ACT

Sec. 253.201. APPLICABILITY OF SUBCHAPTER. This subchapter applies only to a political contribution or political expenditure in connection with:

(1) a statewide office in the executive branch;

(2) the office of state senator;

(3) the office of state representative; or

(4) the office of member, State Board of Education.

Sec. 253.202. DEFINITIONS. In this subchapter:

(1) "Complying candidate" or "complying officeholder" means a candidate who files a declaration of compliance under Section 253.207(a)(1).

(2) "Election cycle" means the period beginning on January 1 of an odd-numbered year and ending on December 31 of the following even-numbered year.

(3) "Noncomplying candidate" means a candidate who:

(A) files a declaration of intent to exceed the limit on expenditures or the use of personal funds under Section 253.207(a)(2);

(B) files a declaration of compliance under Section 253.207(a)(1) but later exceeds the limit on expenditures or the use of personal funds;

(C) fails to file a declaration of compliance under Section 253.207(a)(1) or a declaration of intent under Section 253.207(a)(2); or

(D) violates Section 253.216 or 253.217.

Sec. 253.203. CONTRIBUTION LIMITS. (a) A candidate or officeholder may not, except as provided by Subsection (c), knowingly accept political contributions from a person that in the aggregate exceed the limits prescribed by Subsection (b) in an election cycle.

(b) The contribution limits are:

(1) for a statewide office, $2,000;

(2) for the office of state senator, $1,000;

(3) for the office of state representative, $500; or

(4) for the office of member, State Board of Education, $1,500.

(c) If a candidate has an opponent in the primary election, the limits prescribed by Subsection (b) are doubled, except that a person may not make political contributions that in the aggregate exceed the applicable limit prescribed by Subsection (b):

(1) during the period beginning on the first day of the election cycle and ending on the day of the primary election; or

(2) during the period beginning on the day after the day of the primary election and ending on the last day of the election cycle.

(d) This section does not apply to a political contribution made by an out-of-state political committee.

(e) Notwithstanding Section 254.034, a person who receives a political contribution that violates Subsection (a) shall return the contribution to the contributor not later than the later of:

(1) the last day of the reporting period in which the contribution is received; or

(2) the fifth day after the date the contribution is received.

(f) A person who violates this section is liable for a civil penalty not to exceed three times the amount of the political contributions accepted in violation of this section.

Sec. 253.204. CONTRIBUTION BY CHILD CONSIDERED TO BE CONTRIBUTION BY INDIVIDUAL. (a) For purposes of Section 253.203, a contribution by the child of an individual is considered to be a contribution by the individual.

(b) In this section, "child" means a person under 18 years of age who is not and has not been married or who has not had the disabilities of minority removed for general purposes.

Sec. 253.205. RESTRICTIONS ON REIMBURSEMENT OF PERSONAL FUNDS AND PAYMENTS ON CERTAIN LOANS. (a) A noncomplying candidate or officeholder who makes political expenditures from the person's personal funds may not reimburse the personal funds from political contributions in amounts that in the aggregate exceed $50,000 in an election cycle.

(b) A candidate or officeholder who accepts one or more political contributions in the form of loans, including an extension of credit or a guarantee of a loan or extension of credit, from one or more persons related to the candidate or officeholder within the second degree by consanguinity, as determined under Subchapter B, Chapter 573, Government Code, may not use political contributions to repay the loans.

(c) A person who is both a candidate and an officeholder may reimburse the person's personal funds only in one capacity.

(d) This section does not apply to a candidate for or holder of a statewide office.

(e) A person who violates this section is liable for a civil penalty not to exceed three times the amount by which the reimbursement made in violation of this section exceeds the applicable limit prescribed by Subsection (a).

Sec. 253.206. NOTICE REQUIRED FOR CERTAIN POLITICAL EXPENDITURES. (a) A person other than a candidate, an officeholder, or the principal political committee of the state executive committee or a county executive committee of a political party may not make political expenditures that in the aggregate exceed the applicable limits prescribed by Section 253.213 for the purpose of supporting or opposing a candidate or assisting a candidate as an officeholder unless the person files with the commission a written declaration of the person's intent to make expenditures that exceed the limit prescribed by Section 253.213.

(b) A declaration under Subsection (a) must be filed not later than the earlier of:

(1) the date the person makes the political expenditure that causes the person to exceed the limit prescribed by Section 253.213; or

(2) the 60th day before the date of the election in connection with which the political expenditures are intended to be made.

(c) The commission shall file a declaration received under Subsection (a) with the records of each candidate or officeholder on whose behalf the person filing the declaration intends to make political expenditures. If the person intends to make only political expenditures opposing a candidate, the commission shall file the declaration with the records of each candidate for the office.

(d) An expenditure made by a political committee or other association that consists only of costs incurred in contacting the committee's or association's membership may be made without the declaration required by Subsection (a).

(e) For purposes of this section, a person who makes a political expenditure benefiting more than one candidate or officeholder shall, in accordance with commission rule, allocate a portion of the expenditure to each candidate or officeholder whom the expenditure benefits in proportion to the benefit received by that candidate or officeholder. For purposes of this subsection:

(1) a political expenditure for supporting candidates or assisting officeholders benefits each candidate or officeholder supported or assisted; and

(2) a political expenditure for opposing a candidate benefits each opponent of the candidate.

(f) A person who violates this section is liable for a civil penalty not to exceed three times the amount of the political expenditures made in violation of this section.

Sec. 253.207. VOLUNTARY COMPLIANCE. (a) When a person becomes a candidate for office, the person shall file with the commission:

(1) a sworn declaration of compliance stating that the person voluntarily agrees to comply with the applicable limits on expenditures and the use of personal funds prescribed by this subchapter; or

(2) a written declaration of the person's intent to make expenditures that exceed the applicable limit prescribed by this subchapter or use of personal funds in an amount exceeding the limit prescribed by this subchapter.

(b) The limits on contributions prescribed by this subchapter apply to complying candidates unless suspended as provided by Section 253.208 or 253.213. The limits on contributions and on reimbursement of personal funds prescribed by this subchapter apply to noncomplying candidates regardless of whether the limits on contributions, expenditures, and the use of personal funds are suspended for complying candidates.

(c) A candidate may not knowingly accept a campaign contribution or make or authorize a campaign expenditure before the candidate files a declaration under Subsection (a).

(d) A person who violates Subsection (c) is liable for a civil penalty not to exceed three times the amount of the political contributions or political expenditures made in violation of this section.

Sec. 253.208. EFFECT OF NONCOMPLYING CANDIDATE. (a) A complying candidate or a specific-purpose committee for supporting a complying candidate is not required to comply with the applicable limits on contributions, expenditures, and the use of personal funds prescribed by this subchapter if another person becomes a candidate for the same office and:

(1) files a declaration of intent to exceed the applicable limit on expenditures under Section 253.207(a)(2);

(2) fails to file a declaration of compliance under Section 253.207(a)(1) or a declaration of intent under Section 253.207(a)(2);

(3) files a declaration of compliance under Section 253.207(a)(1) but later exceeds the applicable limit on expenditures or the use of personal funds; or

(4) violates Section 253.216 or 253.217.

(b) The executive director of the commission shall issue an order suspending the limits on contributions, expenditures, and the use of personal funds for a specific office not later than the fifth day after the date the executive director determines that:

(1) a person has become a candidate for that office and:

(A) has filed a declaration of intent to exceed the applicable limits on expenditures and the use of personal funds under Section 253.207(a)(2); or

(B) has failed to file a declaration of compliance under Section 253.207(a)(1) or a declaration of intent under Section 253.207(a)(2);

(2) a complying candidate for that office has exceeded the applicable limit on expenditures or the use of personal funds prescribed by this subchapter; or

(3) a candidate for that office has violated Section 253.216 or 253.217.

Sec. 253.209. BENEFIT TO COMPLYING CANDIDATE. (a) A complying candidate is entitled to state on political advertising as provided by Section 255.009 that the candidate complies with the Texas Campaign Fairness Act, regardless of whether the limits on contributions, expenditures, and the use of personal funds are later suspended.

(b) A noncomplying candidate is not entitled to the benefit provided by this section.

Sec. 253.210. EXPENDITURE LIMITS. (a) In each election cycle, a complying candidate may not knowingly make or authorize political expenditures that in the aggregate exceed:

(1) for a statewide office, $5 million;

(2) for the office of state senator, $1 million;

(3) for the office of state representative, $500,000; or

(4) for the office of member, State Board of Education, $1 million.

(b) A person who violates this section is liable for a civil penalty not to exceed three times the amount by which the political expenditures made in violation of this section exceed the applicable limit prescribed by Subsection (a).

Sec. 253.211. EXPENDITURE BY CERTAIN COMMITTEES CONSIDERED EXPENDITURE BY CANDIDATE. (a) For purposes of Section 253.210, an expenditure by a specific-purpose committee for the purpose of supporting a candidate, opposing the candidate's opponent, or assisting the candidate as an officeholder is considered to be an expenditure by the candidate unless the candidate, in an affidavit filed with the commission, states that the candidate's campaign, including the candidate, an aide to the candidate, a campaign officer, or a campaign consultant of the candidate, has not directly or indirectly communicated with the committee in regard to a strategic matter, including polling data, advertising, or voter demographics, in connection with the candidate's campaign.

(b) This section applies only to an expenditure of which the candidate or officeholder has notice.

(c) An affidavit under this section shall be filed with the next report the candidate or officeholder is required to file under Chapter 254 following the receipt of notice of the expenditure.

Sec. 253.212. LIMITS ON USE OF PERSONAL FUNDS. (a) In each election cycle, a complying candidate may not knowingly make or authorize political expenditures from the candidate's personal funds that in the aggregate exceed:

(1) for a statewide office, $100,000; or

(2) for an office other than a statewide office, $50,000.

(b) A person who violates this section is liable for a civil penalty not to exceed three times the amount by which the political expenditures made in violation of this section exceed the applicable limit prescribed by Subsection (a).

Sec. 253.213. EFFECT OF CERTAIN POLITICAL EXPENDITURES. (a) A complying candidate or a specific-purpose committee for supporting a complying candidate is not required to comply with the applicable limits on contributions, expenditures, and the use of personal funds prescribed by this subchapter if a person makes political expenditures supporting the candidate's opponent, assisting the candidate's opponent as an officeholder, or opposing the candidate that in the aggregate exceed the following amounts:

(1) for a statewide office, $100,000;

(2) for the office of state senator, $50,000;

(3) for the office of state representative, $25,000; or

(4) for the office of member, State Board of Education, $50,000.

(b) The executive director of the commission shall issue an order suspending the limits on contributions, expenditures, and the use of personal funds for a specific office not later than the fifth day after the date the executive director determines that:

(1) a declaration of intent to make expenditures that exceed the limit prescribed by Subsection (a) is filed in connection with the office as provided by Section 253.206; or

(2) a political expenditure that exceeds the limit prescribed by Subsection (a) has been made.

(c) The limits prescribed by Subsection (a) do not apply to:

(1) an expenditure made by the complying candidate's opponent;

(2) an expenditure made by the principal political committee of the state executive committee or a county executive committee of a political party; or

(3) an expenditure made by a political committee or other association that consists only of costs incurred in contacting the committee's or association's membership.

Sec. 253.214. CONTRIBUTION FROM OR DIRECT CAMPAIGN EXPENDITURE BY POLITICAL PARTY. (a) Except as provided by Subsection (b), a political contribution to or a direct campaign expenditure on behalf of a complying candidate that is made by the principal political committee of the state executive committee or a county executive committee of a political party is considered to be a political expenditure by the candidate for purposes of the expenditure limits prescribed by Section 253.210.

(b) Subsection (a) does not apply to a political expenditure for a generic get-out-the-vote campaign or for a written list of two or more candidates that:

(1) identifies the party's candidates by name and office sought, office held, or photograph;

(2) does not include any reference to the political philosophy or positions on issues of the party's candidates; and

(3) is not broadcast, cablecast, published in a newspaper or magazine, or placed on a billboard.

Sec. 253.215. RESTRICTION ON EXCEEDING EXPENDITURE LIMITS. (a) A candidate who files a declaration of compliance under Section 253.207(a)(1) and who later files a declaration of intent to exceed the applicable limits on expenditures and the use of personal funds under Section 253.207(a)(2) or a specific-purpose committee for supporting such a candidate may not make a political expenditure that causes the person to exceed the applicable limit on expenditures prescribed by Section 253.210 before the 60th day after the date the candidate files the declaration of intent to exceed the limits on expenditures and the use of personal funds.

(b) A person who violates this section is liable for a civil penalty not to exceed three times the amount of political expenditures made in violation of this section.

Sec. 253.216. AGREEMENT TO EVADE LIMITS PROHIBITED. (a) A complying candidate may not:

(1) solicit a person to campaign as a noncomplying candidate opposing the complying candidate; or

(2) enter into an agreement under which a person campaigns as a noncomplying candidate opposing the complying candidate.

(b) A candidate who violates this section is considered to be a noncomplying candidate.

Sec. 253.217. MISREPRESENTATION OF OPPONENT'S COMPLIANCE WITH OR VIOLATION OF SUBCHAPTER PROHIBITED. (a) A candidate may not knowingly misrepresent that an opponent of the candidate:

(1) is a noncomplying candidate; or

(2) has violated this subchapter.

(b) A candidate who violates this section is considered to be a noncomplying candidate.

Sec. 253.218. CIVIL PENALTY. (a) The commission may impose a civil penalty under this subchapter against a person as provided by Subchapter E, Chapter 571, Government Code.

(b) The commission shall base the amount of the penalty on:

(1) the seriousness of the violation;

(2) the history of previous violations;

(3) the amount necessary to deter future violations; and

(4) any other matter that justice may require.

(c) A penalty paid under this subchapter shall be deposited in the general revenue fund to the credit of the commission. The commission may use amounts representing penalties paid under this subchapter only for purposes of enforcing this subchapter.

SECTION 2. Chapter 255, Election Code, is amended by adding Section 255.009 to read as follows:

Sec. 255.009. DISCLOSURE ON POLITICAL ADVERTISING FOR LEGISLATIVE OR EXECUTIVE OFFICE. (a) This section applies only to a candidate or political committee covered by Subchapter G, Chapter 253.

(b) Political advertising by a candidate who files a declaration of intent to comply with the applicable limits on expenditures and the use of personal funds under Subchapter G, Chapter 253, or a specific-purpose committee for supporting such a candidate may include the following statement: "Political advertising paid for by (name of candidate or committee) in compliance with the voluntary limits of the Texas Campaign Fairness Act."

(c) Political advertising by a candidate who files a declaration of intent to comply with the applicable limits on expenditures and the use of personal funds under Subchapter G, Chapter 253, or a specific-purpose committee for supporting such a candidate that does not contain the statement prescribed by Subsection (b) must comply with Section 255.001.

(d) Political advertising by a candidate who files a declaration of intent to exceed the applicable limits on expenditures and the use of personal funds under Subchapter G, Chapter 253, or a specific-purpose committee for supporting such a candidate must include the following statement: "Political advertising paid for by (name of candidate or committee), (who or which) has rejected the voluntary limits of the Texas Campaign Fairness Act."

(e) The commission shall adopt rules providing for:

(1) the minimum size of the disclosure required by this section in political advertising that appears on television or in writing; and

(2) the minimum duration of the disclosure required by this section in political advertising that appears on television or radio.

(f) A person who violates this section or a rule adopted under this section is liable for a civil penalty not to exceed:

(1) $15,000, for a candidate for a statewide office or a specific-purpose committee for supporting such a candidate;

(2) $10,000, for a candidate for the office of state senator or a specific-purpose committee for supporting such a candidate;

(3) $5,000, for a candidate for the office of state representative or a specific-purpose committee for supporting such a candidate; or

(4) $10,000, for a candidate for the office of member, State Board of Education, or a specific-purpose committee for supporting such a candidate.

(g) Section 253.218 applies to the imposition and disposition of a civil penalty under this section.

SECTION 3. Subchapter G, Chapter 253, Election Code, as added by this Act, applies only to a political contribution accepted or political expenditure made on or after the effective date of this Act. A political contribution accepted or political expenditure made before the effective date of this Act is governed by the law in effect on the date the contribution was accepted or the expenditure was made and is not aggregated with political contributions accepted or political expenditures made on or after the effective date of this Act.

SECTION 4. Sections 253.206, 253.207, 253.208, 253.209, 253.210, 253.211, 253.212, 253.213, 253.214, 253.215, 253.216, and 253.217, Election Code, as added by this Act, are not severable, and none would have been enacted without the others. If any one of those provisions is held invalid, each of those provisions is invalid.

SECTION 5. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2011.