January 25, 2017, Introduced by Senators BIEDA and HOPGOOD and referred to the Committee on Elections and Government Reform.
A bill to regulate political activity; to regulate certain
candidates for elective office and state and local officials; to
require financial statements and reports; to prescribe the powers
and duties of certain state and local governmental officers and
agencies; to impose fees; to prescribe penalties and civil
sanctions; and to provide remedies.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"financial disclosure act".
Sec. 2. As used in this act:
(a) "Bureau of elections" means the bureau provided for by
section 32 of the Michigan election law, 1954 PA 116, MCL 168.32.
(b) "Candidate" means that term as defined in section 3 of the
Michigan campaign finance act, 1976 PA 388, MCL 169.203.
(c) "Candidate for state or local office" means a candidate
for any of the following offices:
(i) Governor.
(ii) Lieutenant governor.
(iii) Secretary of state.
(iv) Attorney general.
(v) State senator.
(vi) State representative.
(vii) Member of the state board of education.
(viii) Justice of the supreme court or judge of a court of
record.
(ix) Regent of the University of Michigan, member of the board
of trustees of Michigan State University, or member of the board of
governors of Wayne State University.
(x) An elective public office for which the compensation is
greater than 2 times the statewide median gross income as
determined under section 143(f) of the internal revenue code of
1986, 26 USC 143(f).
(d) "Earned income" means salaries, tips, or other
compensation, and net earnings from self-employment for the taxable
year.
(e) "Immediate family" means a dependent child, a spouse of an
individual, or a person claimed by that individual or that
individual's spouse as a dependent for federal income tax purposes.
(f) "Income" means money or any thing of value received, or to
be received as a claim on future services, whether in the form of a
fee, salary, expense, allowance, forbearance, forgiveness,
interest, dividend, royalty, rent, capital gain, or any other form
of recompense that is considered income under the internal revenue
code of 1986, 26 USC 1 to 9834.
(g) "Principal residence" means that term as defined under
section 7dd of the general property tax act, 1893 PA 206, MCL
211.7dd.
(h) "State or local official" means any of the following:
(i) The holder of an office described in subdivision (c).
(ii) The head of each principal department as described in
section 3 of article V of the state constitution of 1963, if the
office is filled by appointment.
(iii) A member of a board or commission heading a principal
department as described in section 3 of article V of the state
constitution of 1963, if the office is filled by appointment.
Sec. 3. (1) If an individual is a state or local official at
any time during a calendar year, that individual shall file with
the bureau of elections by May 1 of the following year a report
that meets the requirements of section 4. This subsection does not
apply to an individual who was a state or local official only on
the first day of the calendar year.
(2) If an individual is a candidate for state or local office
and has not already filed a report under subsection (1) covering
the preceding calendar year, that individual shall file with the
bureau of elections a report that meets the requirements of section
4 within 30 days after the earliest of the following events, but
not later than 11 days before the first election at which the
individual's name appears on the ballot as a candidate following
the event:
(a) If the individual files a fee, affidavit of incumbency, or
nominating petition for the state office, the deadline for filing
the fee, affidavit of incumbency, or nominating petition
established under the Michigan election law, 1954 PA 116, MCL 168.1
to 168.992.
(b) If the individual is nominated at a political party caucus
or convention, the deadline for holding the caucus or convention
established under the Michigan election law, 1954 PA 116, MCL 168.1
to 168.992.
(c) The date on which the individual first receives a
contribution, makes an expenditure, or gives consent for another
person to receive a contribution or make an expenditure with the
purpose or intent of bringing about the individual's nomination or
election to a state office.
(d) The date on which the individual forms a candidate
committee as a candidate for state or local office under section 21
of the Michigan campaign finance act, 1976 PA 388, MCL 169.221.
(3) An individual who is a candidate for the office of
governor shall file with the bureau of elections on June 15 of the
year in which the election for the office of governor will be held
a copy of the individual's federal tax returns for the 3 preceding
calendar years. A social security number on a tax return filed
under this subsection may be redacted.
Sec. 4. (1) Subject to section 5 and except as provided in
section 6, a report required under section 3 must include a
complete statement of all of the following:
(a) The full name, address, occupation of, and the state
office held or sought by, the individual filing the report.
(b) The name of each member of the immediate family of the
individual filing the report.
(c) The name and address of each employer of the individual
filing the report during the calendar year covered by the report.
(d) Both of the following, as applicable:
(i) The source, type, and amount or value of earned income
received during the preceding calendar year by the individual
filing the report if the total earned income from that source
equals $1,000.00 or more during that calendar year.
(ii) The source and type of earned income received during the
preceding calendar year by the spouse of the individual filing the
report if the total earned income from that source equals $1,000.00
or more during that calendar year.
(e) The source, type, and amount or value of all other income
not reported under subdivision (d) that is received during the
preceding calendar year by the individual filing the report or a
member of the immediate family of that individual if the total
income from that source equals $1,000.00 or more during that
calendar year.
(f) The identity and value of each asset held during the
preceding calendar year by the individual filing the report or a
member of the immediate family of that individual, including real
or personal property or cash, if the asset had a fair market value
of $10,000.00 or more at any time the asset was held during the
preceding calendar year. However, if the individual filing the
report owns or has an interest in all or a portion of a farm or
business, he or she is not required to report the identity and
value of each asset held during the preceding year that is used in
the operation of the farm or business under this subdivision if the
report includes a complete statement of the identity and value of
the farm or business.
(g) The identity and value of each liability owed during the
preceding calendar year by the individual filing the report or a
member of the immediate family of that individual if the amount of
the liability was $10,000.00 or more at any time during the
preceding calendar year. This subdivision does not apply to loans
secured by the principal residence of the individual filing the
report or by a personal motor vehicle, household furniture, or
appliance, if the loans do not exceed the greater of the purchase
price or the market value of the item that secures the liability.
(h) A brief description and value of a purchase, sale, or
exchange of real property, other than real property used solely as
a principal residence by the individual filing the report and his
or her immediate family, or of stocks, bonds, commodities, futures,
or other forms of securities during the preceding calendar year by
the individual filing the report or a member of the immediate
family of that individual, if the value is $1,000.00 or more. This
subdivision does not require a description of each purchase, sale,
or exchange of stocks, bonds, commodities, or other forms of
securities if those items are part of a mutual fund and if the
identity and value of the mutual fund is otherwise reported under
this act.
(i) Except as otherwise provided under this subdivision, the
identity of all positions held by the individual filing the report
during the preceding calendar year as an officer, director, member,
trustee, partner, proprietor, representative, employee, or
consultant of a corporation, limited liability company, limited
partnership, partnership, or other business enterprise; of a
nonprofit organization; of a labor organization; or of an
educational or other institution other than this state. If an
individual filing the report is required to have a license to
practice or engage in a particular occupation or profession, he or
she is not required to identify a position held as a consultant of
a corporation unless the corporation is a publicly held corporation
that has shares that are listed or traded over the counter or on an
organized exchange or has gross revenues over $4,000,000.00. This
subdivision does not require the reporting of a position held in a
religious, social, fraternal, or political entity, or of a position
solely of an honorary nature.
(j) If the individual filing the report has an agreement or
has made an arrangement with respect to future employment, a leave
of absence during that individual's term of office, continuation of
payments by a former employer, or continuation of participation in
an employee benefit plan maintained by a former employer, a
description of the agreement or arrangement, including the dates,
parties, and terms.
(2) Information an individual is required to report under this
section includes information with respect to the holdings of and
the income from a trust or other financial arrangement from which
income is received by, or with respect to which a beneficial
interest in principal or income is held by, an individual required
to file a report under this section or an immediate family member
of the individual.
Sec. 5. (1) An amount or value reported under section 4(d),
(e), (f), or (h) must be reported by category as follows:
(a) $1,000.00 or more but less than $10,000.00.
(b) $10,000.00 or more but less than $50,000.00.
(c) $50,000.00 or more but less than $100,000.00.
(d) $100,000.00 or more but less than $500,000.00.
(e) $500,000.00 or more.
(2) An amount or value reported under section 4(g) must be
reported by category as follows:
(a) $10,000.00 or more but less than $50,000.00.
(b) $50,000.00 or more but less than $100,000.00.
(c) $100,000.00 or more but less than $500,000.00.
(d) $500,000.00 or more.
(3) Instead of specifying the category of the amount or value
of an item in a report under this act, an individual may indicate
the exact amount or value of the item.
Sec. 6. A person filing a report under section 3 may omit any
of the following:
(a) Information a person is required to report under the
Michigan campaign finance act, 1976 PA 388, MCL 169.201 to 169.282.
(b) A liability owed to the individual filing the report or a
relative within the third degree of consanguinity to that
individual if lent by the individual filing the report or a
relative within the third degree of consanguinity to that
individual.
(c) An item otherwise required to be reported under section
4(f), (g), or (h) if all of the following apply:
(i) The item represents the sole financial interest and
responsibility of a member of the immediate family of the
individual filing the report about which the individual filing the
report does not have actual knowledge.
(ii) The item is not in any way, past or present, derived from
the income, assets, or activities of the individual filing the
report.
(iii) The individual filing the report does not derive, or
expect to derive, financial benefit from the item.
(d) An item that concerns a spouse who is living separate and
apart from the individual filing the report with the intention of
terminating the marriage or maintaining a legal separation.
(e) An item that concerns income or obligations of the
individual filing the report arising from dissolution of his or her
marriage or a permanent legal separation from his or her spouse.
(f) Compensation from a publicly held corporation that has
shares that are listed or traded over the counter or on an
organized exchange paid to a business owned by the individual
filing the report or in which the individual filing the report has
an interest, if the report under section 4 includes a complete
statement of the identity and value of that business and the
individual filing the report is required to have a license as
described in section 4(i).
(g) Benefits received under the social security act, chapter
531, 49 Stat. 620.
Sec. 7. The bureau of elections shall do all of the following:
(a) Prepare and make available appropriate forms and
instructions for the reports required by this act.
(b) Receive reports required by this act.
(c) As soon as practicable, but not later than the end of the
business day on which a report required to be filed under this act
is received, make the report or all of the contents of the report
available without charge to the public on the internet at a single
website established and maintained by the secretary of state, and
not later than the third business day following the day on which
the report is received, make the report available for public
inspection and reproduction during regular business hours.
(d) Promulgate rules and issue declaratory rulings to
implement this act under the administrative procedures act of 1969,
1969 PA 306, MCL 24.201 to 24.328.
(e) Conduct investigations as necessary to determine whether
there is reason to believe that a violation of this act occurred.
The bureau of elections shall conduct an investigation under the
administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to
24.328.
Sec. 8. (1) A citizen of this state may file a complaint with
the bureau of elections alleging a violation of this act. If it
receives a complaint, the bureau of elections shall investigate the
allegations as provided in section 7.
(2) If the bureau of elections determines after an
investigation that there is reason to believe a violation of this
act occurred, the bureau of elections shall forward the results of
that investigation to the attorney general for enforcement of this
act, if the attorney general is not the subject of the complaint.
If the bureau of elections determines after an investigation that
there is reason to believe that the attorney general violated this
act, the bureau of elections shall forward the results of the
investigation to the prosecuting attorney for Ingham county for
enforcement of this act.
(3) The attorney general or, if the attorney general is the
individual who is alleged to have violated this act, the
prosecuting attorney for Ingham County shall enforce this act
against an individual who violates this act.
Sec. 9. (1) An individual who fails to file a report as
required under this act shall pay a late filing fee of not more
than $1,000.00, determined as follows:
(a) Twenty-five dollars for each of the first 3 business days
that the report remains unfiled.
(b) Fifty dollars for each of the next 7 business days after
the first 3 business days that the report remains unfiled.
(c) One hundred dollars for each business day after the first
10 business days that the report remains unfiled.
(2) If an individual required to file a report under this act
knowingly files an incomplete or inaccurate report, the individual
is guilty of a misdemeanor punishable by imprisonment for not more
than 90 days or a fine of not more than $1,000.00, or both.
(3) If an individual required to file a report under this act
fails to file 2 reports and if both of the reports remain unfiled
for more than 30 days, the individual is guilty of a misdemeanor
punishable by imprisonment for not more than 90 days or a fine of
not more than $1,000.00, or both.
(4) A default in the payment of a fee or civil fine due or
ordered under this act, or an installment of the fee or fine, may
be remedied by any means available under the revised judicature act
of 1961, 1961 PA 236, MCL 600.101 to 600.9947.
Enacting section 1. This act takes effect 90 days after the
date it is enacted into law.