Bill Text: AZ HCR2029 | 2020 | Fifty-fourth Legislature 2nd Regular | Introduced


Bill Title: Campaign finance; source disclosure

Spectrum: Partisan Bill (Democrat 39-0)

Status: (Introduced) 2020-05-19 - Assigned to House RULES Committee [HCR2029 Detail]

Download: Arizona-2020-HCR2029-Introduced.html

 

 

 

REFERENCE TITLE: campaign finance; source disclosure

 

 

 

 

State of Arizona

House of Representatives

Fifty-fourth Legislature

Second Regular Session

2020

 

 

 

HCR 2029

 

Introduced by

Representatives Jermaine: Andrade, Blanc, Butler, Cano, Chávez, DeGrazia, Engel, Epstein, Espinoza, Fernandez, Friese, Hernandez A, Hernandez D, Lieberman, Longdon, Meza, Pawlik, Peten, Powers Hannley, Rodriguez, Salman, Shah, Sierra, Teller, Terán, Tsosie, Senators Alston, Bowie, Bradley, Contreras, Dalessandro, Gonzales, Mendez, Navarrete, Peshlakai, Quezada, Rios, Steele

 

 

AN ACT

 

proposing an amendment to the constitution of Arizona; amending article VII, CONSTITUTION of Arizona, by adding section 19; relating to campaign finance DISCLOSURES.

 

 

(TEXT OF BILL BEGINS ON NEXT PAGE)

 


Be it resolved by the House of Representatives of the State of Arizona, the Senate concurring:

1.  Article VII, Constitution of Arizona, is proposed to be amended by adding section 19 as follows if approved by the voters and on proclamation of the Governor:

19.  Right to know original source of campaign expenditures; disclosure; enforcement; civil penalties; definitions

SECTION 19. A.  ARIZONA VOTERS' RIGHT TO KNOW THE ORIGINAL SOURCES OF CAMPAIGN MEDIA EXPENDITURES. THE PEOPLE OF ARIZONA HAVE THE RIGHT TO KNOW THE IDENTITY OF THE ORIGINAL SOURCES OF ALL MAJOR CONTRIBUTIONS USED TO PAY, IN WHOLE OR PART, FOR A CAMPAIGN MEDIA EXPENDITURE. THIS RIGHT REQUIRES THE PROMPT, ACCESSIBLE, COMPREHENSIBLE AND PUBLIC DISCLOSURE OF ORIGINAL SOURCES OF FUNDS USED TO INFLUENCE ARIZONA ELECTIONS.

1.  AN "ORIGINAL SOURCE" IS A PERSON WHOSE CONTRIBUTION IS FUNDED FROM WAGES, INVESTMENT INCOME, INHERITANCE OR REVENUE GENERATED FROM SELLING GOODS OR SERVICES. FUNDS DERIVED FROM CONTRIBUTIONS, DONATIONS, DUES, OR GIFTS ARE NOT ORIGINAL.

2.  "PERSON" INCLUDES BOTH NATURAL PERSONS AND ENTITIES SUCH AS CORPORATIONS, PARTNERSHIPS AND ASSOCIATIONS, REGARDLESS OF LEGAL FORM.

3.  A "MAJOR CONTRIBUTION" IS ANY PAYMENT OR AGGREGATE PAYMENT OF FUNDS, GOODS OR SERVICES, WHETHER IN THE FORM OF A CONTRIBUTION, DONATION, GIFT, LOAN, ADVANCE, DEPOSIT, OR IN-KIND SERVICE, WITH A MONETARY VALUE OF $5,000 OR MORE MADE DURING AN ELECTION CYCLE.

4.  "ELECTION CYCLE" MEANS THE TIME BEGINNING THE DAY AFTER THE GENERAL ELECTION DAY AND CONTINUING FOR TWO YEARS THROUGH THE END OF THE SUBSEQUENT GENERAL ELECTION DAY.

5.  A "CAMPAIGN MEDIA EXPENDITURE" IS A PAYMENT OR A PROMISE TO PAY FOR (A) A PUBLIC COMMUNICATION THAT IS SUSCEPTIBLE TO NO REASONABLE INTERPRETATION OTHER THAN AN APPEAL TO VOTE FOR OR AGAINST ONE OR MORE CLEARLY IDENTIFIED STATE OR LOCAL CANDIDATES OR BALLOT MEASURES; (B) A PUBLIC COMMUNICATION THAT CLEARLY IDENTIFIES ONE OR MORE STATE OR LOCAL CANDIDATES OR BALLOT MEASURES AND IS DISTRIBUTED WITHIN THE PERIODS BEGINNING 45 DAYS BEFORE THE PRIMARY ELECTION AND ENDING ON THE DATE OF THE PRIMARY ELECTION OR BEGINNING 90 DAYS BEFORE THE GENERAL ELECTION AND ENDING ON THE DATE OF THE GENERAL ELECTION AT WHICH VOTERS WILL CONSIDER THOSE CANDIDATES OR BALLOT MEASURES; OR (C) RESEARCH, DESIGN, PRODUCTION, POLLING, DATA ANALYTICS, MAILING OR SOCIAL MEDIA LIST ACQUISITION, OR OTHER ACTIVITIES CONDUCTED TO PRODUCE OR HELP DISSEMINATE THE PUBLIC COMMUNICATION REFERENCED IN SUBPARAGRAPHS (A) OR (B).

6.  "PUBLIC COMMUNICATION" MEANS PAID COMMUNICATION TO THE GENERAL PUBLIC BY MEANS OF BROADCAST, CABLE, SATELLITE, INTERNET OR OTHER DIGITAL METHOD, NEWSPAPER, MAGAZINE, OUTDOOR ADVERTISING, MASS MAILING, OR ANY OTHER FORM OF GENERA L, PAID DISTRIBUTION REGARDLESS OF MEDIUM.

7.  NOTWITHSTANDING THE FOREGOING, CAMPAIGN MATERIALS THAT ARE DISTRIBUTED PERSON TO PERSON THROUGH DOOR TO DOOR CANVASES, COMMUNICATIONS BETWEEN AN ORGANIZATION AND ITS MEMBERS, EMPLOYEES, OR STOCKHOLDERS, AND NON-PARTISAN ANNOUNCEMENTS OF DEBATES BETWEEN CANDIDATES OR PROPONENTS OF BALLOT PROPOSITIONS ARE NOT PUBLIC COMMUNICATIONS.

8.  "COMMISSION" MEANS THE ARIZONA CITIZENS CLEAN ELECTIONS COMMISSION.

B.  ANY PERSON THAT MAKES CAMPAIGN MEDIA EXPENDITURES TOTALING MORE THAN $20,000 FOR STATEWIDE CAMPAIGNS ONLY OR $10,000 FOR ALL OTHER CAMPAIGNS DURING AN ELECTION CYCLE SHALL PROMPTLY DISCLOSE THE AMOUNT OF THE EXPENDITURES AND THE ORIGINAL SOURCES AND AMOUNTS OF ALL MAJOR CONTRIBUTIONS USED TO FUND THOSE EXPENDITURES.

1.  THE INITIAL DISCLOSURE SHALL BE MADE WITHIN 5 DAYS OF THE DAY THE TOTAL CAMPAIGN MEDIA EXPENDITURES REACH THE DISCLOSURE THRESHOLD.

2.  IF A PERSON MAKES ADDITIONAL CAMPAIGN MEDIA EXPENDITURES DURING AN ELECTION CYCLE, THEY SHALL FILE SUPPLEMENTAL DISCLOSURES EACH TIME THE ADDITIONAL CAMPAIGN MEDIA EXPENDITURES REACH AN AGGREGATE VALUE OF $10,000 OR MORE.

3.  THE COMMISSION SHALL PROMULGATE RULES FOR FILING SUCH DISCLOSURES TO ASSURE, TO THE EXTENT POSSIBLE, DISCLOSURE BEFORE THE ELECTION.

4.  WHEN FUNDS USED FOR CAMPAIGN MEDIA EXPENDITURES COME IN WHOLE OR IN PART THROUGH INTERMEDIARY PERSONS, THE PERSON FILING THE DISCLOSURE, IN ADDITION TO DISCLOSING THE ORIGINAL SOURCES OF MAJOR CONTRIBUTIONS, MUST IDENTIFY THE INTERMEDIARY PERSONS THROUGH WHICH THE CONTRIBUTIONS PASSED ON THEIR WAY FROM THE ORIGINAL SOURCES.

5.  MAJOR CONTRIBUTORS TO THE PERSON MAKING THE DISCLOSURE MUST INFORM THAT PERSON, UPON REQUEST, OF THE IDENTITY OF AND AMOUNTS FROM THE ORIGINAL SOURCES OF ALL MAJOR CONTRIBUTIONS CONTAINED IN THE SUBJECT CONTRIBUTION WHETHER RECEIVED DIRECTLY OR THROUGH INTERMEDIARY PERSONS.

6.  THE COMMISSION SHALL ESTABLISH SPECIFIC AND, WHERE NECESSARY, ENHANCED, DUE DILIGENCE POLICIES AND PROCEDURES THAT ARE REASONABLY DESIGNED TO DETERMINE THE ORIGINAL SOURCE OF MAJOR CONTRIBUTIONS USED FOR CAMPAIGN MEDIA EXPENDITURES. AFTER FOLLOWING SUCH PROCEDURES, THE PERSON MAKING THE DISCLOSURE SHALL REPORT (A) THE IDENTITY OF ALL MAJOR CONTRIBUTORS WHO WERE THE ORIGINAL SOURCES OF FUNDS USED FOR THE REPORTED CAMPAIGN MEDIA EXPENDITURES, AND THE AMOUNT OF THEIR CONTRIBUTIONS; (B) TO THE EXTENT THE FUNDS REPORTED IN SUBPARAGRAPH (A) AS ATTRIBUTABLE TO REPORTED CAMPAIGN MEDIA EXPENDITURES, PLUS THE AMOUNT OF ANY NON-MAJOR CONTRIBUTIONS ATTRIBUTABLE TO THOSE EXPENDITURES, ARE LESS THAN THOSE EXPENDITURES, THE DISCLOSURE REPORT SHALL PROVIDE THE ORIGINAL SOURCES AND AMOUNTS OF THE LAST MAJOR CONTRIBUTIONS RECEIVED BY THE PERSON MAKING THE EXPENDITURES.

7.  NOTWITHSTANDING THE FOREGOING, IF AN ORIGINAL SOURCE OR INTERMEDIARY PERSON REQUESTS IN WRITING THAT THEIR FUNDS NOT BE USED FOR CAMPAIGN MEDIA EXPENDITURES, AND THE FUNDS ARE NOT USED FOR CAMPAIGN MEDIA EXPENDITURES, THE DISCLOSURE REPORT SHALL NOT IDENTIFY THE SOURCE OR INTERMEDIARY FOR SUCH FUNDS.

8.  THIS AMENDMENT DOES NOT REQUIRE PUBLIC DISCLOSURE OF THE IDENTITY OF AN ORIGINAL SOURCE THAT CONTRIBUTES LESS THAN $5,000 IN THE AGGREGATE DURING AN ELECTION CYCLE FOR CAMPAIGN MEDIA EXPENDITURES TO THE REPORTING PERSON, DIRECTLY OR THROUGH INTERMEDIARIES.

9.  NOTWITHSTANDING THE FOREGOING, POLITICAL COMMITTEES MAY SATISFY THE REPORTING REQUIREMENTS HEREIN BY FILING THE PERIODIC CAMPAIGN FINANCE REPORTS REQUIRED BY LAW FOR SUCH COMMITTEES, PROVIDED THAT THE INFORMATION REQUIRED BY THIS AMENDMENT TO BE DISCLOSED IS INCLUDED IN THOSE PERIODIC REPORTS AND IDENTIFIES THE ORIGINAL SOURCES OF ALL MAJOR CONTRIBUTIONS.

10.  THE IDENTITY OF ORIGINAL SOURCES WHO ARE OTHERWISE PROTECTED FROM DISCLOSURE BY LAW OR COURT ORDER OR WHO DEMONSTRATE TO THE COMMISSION THAT PUBLIC KNOWLEDGE OF THEIR IDENTITY WOULD SUBJECT THEM OR THEIR FAMILY TO SERIOUS RISK OF PHYSICAL HARM SHALL NOT BE DISCLOSED.

11.  ALL DISCLOSURE REPORTS SHALL BE MADE SUBJECT TO PENALTY OF PERJURY AND SHALL BE MADE TO THE SECRETARY OF STATE, UNLESS OTHERWISE DIRECTED BY LAW OR BY THE COMMISSION.

c.  THE ARIZONA CITIZENS CLEAN ELECTION COMMISSION SHALL BE THE PRIMARY AGENCY AUTHORIZED TO IMPLEMENT THIS CONSTITUTIONAL AMENDMENT.

1.  THE COMMISSION SHALL PROMULGATE AND ENFORCE RULES AND REGULATIONS; ISSUE CIVIL SUBPOENAS; CONDUCT FACT FINDING HEARINGS AND INVESTIGATIONS; IMPOSE FINES FOR NONCOMPLIANCE, INCLUDING PENALTIES FOR LATE DISCLOSURES; AND SEEK LEGAL AND EQUITABLE RELIEF IN COURT AS NECESSARY.

2.  IN IMPLEMENTING AND ENFORCING THIS CONSTITUTIONAL AMENDMENT, THE COMMISSION SHALL BE AN INDEPENDENT AGENCY WHICH DOES NOT REQUIRE THE APPROVAL OF THE GOVERNOR'S REGULATORY REVIEW COUNCIL OR ANY OTHER BODY OR OFFICIAL TO PROMULGATE RULES OR TAKE NECESSARY ACTIONS.

3.  THE COMMISSION SHALL ESTABLISH DISCLAIMER REQUIREMENTS FOR PUBLIC COMMUNICATIONS IN A MANNER IT DETERMINES TO BE IN THE PUBLIC INTEREST.

4.  THE COMMISSION SHALL PROMULGATE RULES ESTABLISHING THE RECORDS REQUIRED TO VERIFY THE TRANSACTIONS REFERENCED IN OR UNDERLYING DISCLOSURES.

5.  THE COMMISSION SHALL PROMULGATE RULES PROVIDING THAT ANY PERSON WHO, FOR THE PURPOSE OF EVADING THE DISCLOSURE REQUIREMENTS OF THIS AMENDMENT OR ANY IMPLEMENTING STATUTE OR REGULATION, SHALL STRUCTURE, OR ATTEMPT TO STRUCTURE, ANY SOLICITATION, CONTRIBUTION, EXPENDITURE, DISBURSEMENT, OR OTHER TRANSACTION IS IN VIOLATION OF THIS AMENDMENT.

6.  IF THE COMMISSION OR A COURT DETERMINES THAT A PERSON FAILED TO MAKE A DISCLOSURE OR PROVIDE INFORMATION AS REQUIRED BY SUBSECTION B OR VIOLATED RULES PROMULGATED PURSUANT TO SUBSECTION (C)(5), A CIVIL FINE OF NOT LESS THAN THE AMOUNT OF THE UNDISCLOSED OR IMPROPERLY DISCLOSED MAJOR CONTRIBUTIONS AND NOT MORE THAN THREE TIMES THAT AMOUNT MAY BE IMPOSED.

7.  ANY FINES OR PENALTIES COLLECTED SHALL BE DEPOSITED INTO THE CLEAN ELECTIONS FUND AND USED FIRST TO DEFRAY THE COSTS OF ENFORCING THIS CONSTITUTIONAL AMENDMENT. ANY REMAINING FUNDS MAY BE USED BY THE COMMISSION TO SUPPORT ITS WORK.

8.  THE COMMISSION MAY ALSO USE OTHER MONIES IN THE CLEAN ELECTIONS FUND TO ENFORCE THIS CONSTITUTIONAL AMENDMENT.

9.  IF THE COMMISSION DETERMINES THAT IT REQUIRES ADDITIONAL FUNDS TO ADMINISTER THIS CONSTITUTIONAL AMENDMENT, A SURCHARGE OF NOT TO EXCEED ONE PERCENT ON CIVIL AND CRIMINAL FINES AND PENALTIES SHALL BE COLLECTED AND DEPOSITED INTO THE CLEAN ELECTIONS FUND.

D.  ANY ELIGIBLE ARIZONA VOTER OR ORGANIZATION REPRESENTING THEM MAY FILE A COMPLAINT WITH THE COMMISSION AGAINST A PERSON WHO FAILS TO COMPLY WITH THE REQUIREMENTS OF THIS CONSTITUTIONAL AMENDMENT OR ITS IMPLEMENTING STATUTES OR REGULATIONS.

1.  THE COMPLAINT MUST BE VERIFIED AND STATE GROUNDS FOR BELIEVING THAT THERE HAS BEEN A VIOLATION OF THIS CONSTITUTIONAL AMENDMENT OR ITS IMPLEMENTING STATUTES OR REGULATIONS.

2.  IF THE COMPLAINT STATES A COLORABLE VIOLATION OF THIS CONSTITUTIONAL AMENDMENT OR ITS IMPLEMENTING STATUTES OR REGULATIONS, THE COMMISSION SHALL TAKE REASONABLE STEPS TO INVESTIGATE THE ALLEGATIONS, INCLUDING PROVIDING THE RESPONDENT WITH NOTICE AND AN OPPORTUNITY TO BE HEARD.

3.  IF THE COMMISSION TAKES NO SUBSTANTIVE ENFORCEMENT ACTION WITHIN THIRTY (30) DAYS OF RECEIVING THE COMPLAINT OR WITHIN TEN (10) DAYS IF THE COMPLAINT IS FILED WITHIN TWENTY (20) DAYS OF THE NEXT ELECTION, THE COMPLAINANT MAY INITIATE A LEGAL ACTION AGAINST THE COMMISSION TO COMPEL SUCH ACTION.

4.  IF THE COMMISSION UNDULY DELAYS ACTION ON OR DISMISSES THE COMPLAINT, THE COMPLAINANT MAY INITIATE (WITHIN 90 DAYS IN THE CASE OF A DISMISSAL) A LEGAL ACTION AGAINST THE COMMISSION, AND THE COURT SHALL REVIEW DE NOVO WHETHER THE COMMISSION'S DISMISSAL OR FAILURE TO ACT WAS REASONABLE. IF THE COMPLAINANT PREVAILS, THE COMPLAINANT MAY BRING IN ITS OWN NAME A CIVIL ACTION TO REMEDY THE VIOLATION ALLEGED IN THE ORIGINAL COMPLAINT.

5.  SHOULD THE COMPLAINANT PREVAIL ON THE MERITS AGAINST THE VIOLATOR, THE COURT SHALL AWARD THE COMPLAINANT REASONABLE ATTORNEY'S FEES AND COSTS.

E.  NOTHING IN THIS CONSTITUTIONAL AMENDMENT SHALL PREVENT THE LEGISLATURE, A COUNTY BOARD OF SUPERVISORS OR A MUNICIPAL GOVERNMENT FROM ENACTING MORE STRINGENT DISCLOSURE PROVISIONS THAN THOSE CONTAINED IN THIS CONSTITUTIONAL AMENDMENT.

F.  THE COMMISSION MAY ADJUST THE AMOUNTS ESTABLISHED HEREIN TO REFLECT THE COST OF LIVING.

Sec. 2.  Title

This Constitutional Amendment shall be known as the "Voters' Right to Know Amendment."

Sec. 3.  Purpose and intent

A.  This Constitutional Amendment is intended to secure the right of the People of Arizona to know the original source of all major contributions used to influence Arizona elections, to prevent corruption and to assist Arizona voters in making informed election decisions.

B.  To secure this right, this Constitutional Amendment requires public disclosure of all contributors who give $5,000 or more used to influence Arizona elections in an election cycle, regardless of whether their contributions passed through any intermediaries.

C.  By adopting this Constitutional Amendment, the People of Arizona affirm their desire to stop the practice of laundering political contributions through multiple intermediaries to hide the original source.

D.  Both individual citizens and the Arizona Citizens Clean Elections Commission will have the ability to enforce these disclosure requirements. Violators will be subject to significant civil penalties.

Sec. 4.  Severability

The People of Arizona declare their intention that the provisions of this Constitutional Amendment are severable. If any provision of this Constitutional Amendment is held to be invalid for any reason by a court, the remaining provisions of this Amendment will be severed from the void portion and given the fullest possible force and application.

Sec. 5.   Submission to voters

The Secretary of State shall submit this Constitutional Amendment to the voters at the next general election as provided by Article XXI, Section 1, Constitution of Arizona.

Sec. 6.   Effective date and implementation

A.  If approved by the voters, this Constitutional Amendment shall be effective pursuant to Article IV, Part 1, Section 1(5), Constitution of Arizona, and shall apply to all elections occurring after January 1, 2022, and to all major contributions made after the effective date of this Amendment.

B.  The Legislature, Secretary of State, Citizens Clean Elections Commission and state and local election officials shall promptly make such changes in and additions to state statutes, regulations and elections procedures as are necessary to fully implement the provisions of this Constitutional Amendment in time for the elections occurring in 2022 and every election thereafter.

C.  The Secretary of State and local elections officials shall publicize the requirements of these provisions.

D.  The rights established by this Constitutional Amendment shall be construed broadly.

Sec. 7.   Legal defense

The People of Arizona desire that this Constitutional Amendment be defended if it is challenged in court. They therefore declare that the political committee registered to circulate petitions in support of this Constitutional Amendment, or any of its members or the Citizens Clean Elections Commission shall have standing to defend this Constitutional Amendment on behalf of and as the agent of the People of Arizona in any legal action brought to challenge the validity of this Constitutional Amendment or any of its provisions.

2.  The Secretary of State shall submit this proposition to the voters at the next general election as provided by article XXI, Constitution of Arizona.

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