Advisory Opinion 06-01
This Advisory Opinion rescinds Advisory Opinion No. 05-05 and responds to a person who asked the Campaign Spending Commission (“Commission”) to reconsider who is the “donor” to a noncandidate committee (“Committee”) when signatory employers to a collective bargaining agreement make payments to the Labor-Management Cooperation Fund (“Sponsoring Organization”)1 which then makes payments to its Committee.
The Commission responds that the Sponsoring Organization is the “donor” to the Committee.2
We understand that signatory employers make payments to the Sponsoring Organization based upon an hourly rate in the collective bargaining agreement multiplied by the number of hours worked by employees of signatory employers. The signatory employers send payments monthly to the Sponsoring Organization and a transmittal listing each employee and the number of hours worked by each employee.
The Sponsoring Organization is a tax-exempt trust which is administered by a board of trustees (half of the trustees are appointed by the union and the other half are appointed by the employers). The payments received by the Sponsoring Organization are used to promote the industry as a whole, including making payments to the Committee.
The Committee registered with the Commission by filing an organizational report.3 The Committee also must file preliminary, final, and supplemental reports with the Commission, which disclose, among other things, “the amount and date of deposit of the contribution and the name and address of each donor who contributes an aggregate of more than $100 during an election period.”4(Emphasis added)
- The signatory employers are not donors because their payments to the Sponsoring Organization are not contributions. A “contribution” includes any gift, deposit of money, or anything of value made by any person for the purpose of influencing an election for a Hawaii elective public or constitutional office.5 The employers’ payments are made pursuant to the collective bargaining agreement, rather than for the purpose of influencing an election.
- The employees are not donors because the employees did not “donate” or “contribute” the employers’ payments. The employees have no rights in the employers’ payments to the Sponsoring Organization. The payments are not the employees’ wages, subject to withholding tax.
- The Sponsoring Organization is the donor because the Sponsoring Organization, rather than the employers or employees, makes payments to the Committee for the purpose of influencing an election for a Hawaii elective public or constitutional office.6
The Commission provides this Advisory Opinion as a means of stating its current interpretation of the Hawaii Campaign Spending laws provided under Hawaii Revised Statutes (HRS) section 11-191, et seq. and the administrative rules of the Commission provided in chapter 2-14, Hawaii Administrative Rules. The Commission may adopt, revise, or revoke this Advisory Opinion upon the enactment of amendments to the statue or the adoption of rules by the Commission.
Dated: Honolulu, Hawaii, June 14, 2006.
CAMPAIGN SPENDING COMMISSION
Steven E. Olbrich
Michael E. Weaver
1 The Sponsoring Organization is a §501(c)(6), Internal Revenue Code trust. This section provides an income tax exemption for business leagues, chambers of commerce, real estate board, boards of trade, and professional football leagues, which are not organized for profit and no part of the net earnings of which inures to the benefit of any private shareholder or individual.
2 In Advisory Opinion No. 05-02, the Commission determined that the employers were the donors to the Committee.
3 Sections 11-194 and 11-196.5, Hawaii Revised Statutes (HRS).
4 Sections 11-212(b) and 11-213(b), HRS.
5 “Contribution” means:
(1) A gift, subscription, deposit of money or anything of value, or cancellation of a debt or legal obligation and includes the purchase of tickets to fundraisers for the purpose of:
(A) Influencing the nomination for election, or election, of any person to office:
(B) Influencing the outcome of any question or issue that appears or is reasonably certain to appear on the ballot at the next applicable election described in subparagraph (A); or
(C) Use by any party or committee for the purposes set out in subparagraph (A) or (B);
(2) The payment, by any person political party, or any other entity other than a candidate or committee, of compensation for the personal services or services of another person that are rendered to the candidate or committee without charge or at an unreasonably low charge for the purposes set out in paragraph (1)(A), (1)(B), or (1)(C);
(3) A contract, promise, or agreement to make a contribution; provided that notwithstanding this paragraph and paragraphs (1) and (2), the term “contributions” shall not include services or portions thereof voluntarily provided without reasonable compensation by individuals to or in behalf of a candidate or committee; or
(4) Notwithstanding paragraphs (1), (2), and (3), a candidate’s expenditure of the candidate’s own Sponsoring Organizations or the making of a loan or advance in the pursuit of the candidate’s campaign shall not be a contribution for the purpose of this subpart but shall nevertheless be reportable as a campaign receipt. See section 11-191, HRS.
6 If the employers were to make payments directly to the noncandidate committee, our answer would differ. Since we find, in this set of facts, that signatory employers are not donors, we do not need to address the issue of preemption of Hawaii’s campaign spending law by the Federal Labor Management Relations Act that was raised by the person requesting reconsideration of Advisory Opinion No. 05-05.