Campaign Spending Commission

     A registered noncandidate committee (aka a political action committee) of an association asks for an advisory opinion regarding the propriety of an officer of the noncandidate committee, who also serves as an officer of another noncandidate committee in making a contribution to a candidate. The officer in question is the owner of a corporation with a noncandidate committee. The same officer has been appointed as the head of an association of which the corporation is a member. A responsibility of the head of the association includes an automatic seat as a voting member of the political action committee.

     Section 11-204 of the Hawaii Revised Statutes (“HRS”) provides for contribution limits by a person for various offices. In general the contribution limit to a candidate running for a two-year office is $2,000, the contribution limit for a candidate running for a four-year office is $4,000, and the contribution limit for a candidate running for a four-year statewide office is $6,000.

     The statute establishes parameters to foreclose opportunities for some individuals to circumvent the contribution limit. For example, section 11-204(h), HRS provides that: “An individual and any partnership in which the individual is a partner, or an individual and any corporation in which the individual owns a controlling interest, shall be treated as one person.” The plain language in this provision means that a contribution by the “majority owner”,1 say $4,000, to a candidate will be added to contributions made by the corporation to the same candidate. In this hypothetical case, if the contribution limit is $4,000 to a candidate, the corporation could not legally make a contribution to the same candidate for the election.

     On the other hand, if the corporation makes a $4,000 contribution to a candidate, the “majority owner” could not make a contribution to the same candidate where the contribution limit is $4,000. Both the “majority owner” and the corporation could make a combined contribution of $4,000 to the same candidate, since the statute reads that the two persons shall be treated as one person.

     Additionally, the statute at section 11-204(l), HRS reads as follows: “No committee which supports or opposes a candidate for public office shall have as officers individuals who serve as officers on any other committee which supports or opposes the same candidate. No such committee shall act in concert with, or solicit or make contributions on behalf of any other committee.” The pertinent language in the statute prohibits an individual from serving on more than one political action or noncandidate committee that supports or opposes the same candidate. In the instant hypothetical case, where the “majority owner” of a corporation makes a contribution to a candidate, the “majority owner” could not serve on another political action committee that supports or opposes the same candidate. Although this language is in the context of political contributions, expenditures for or against a candidate would also apply in a similar manner.

     The intent of the construction of this language is to prevent any circumvention of the contribution limits found in section 11-204, HRS. The Commission’s enforcement of these provisions would be in light of the intent of the law.

     This Advisory Opinion is provided by the Commission as a means of stating its current interpretation of the Hawaii Election Campaign Contributions and Expenditures laws provided under 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 Hawaii Revised Statutes or the adoption of administrative rules by the Commission.

Dated: Honolulu, Hawaii, May 12, 2004.

CAMPAIGN SPENDING COMMISSION

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A. Duane Black
Chairperson

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Mona Chock
Commissioner

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Steven Olbrich
Commissioner

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Gino L. Gabrio
Commissioner

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Paul Kuramoto
Commissioner

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^{1 “Majority owner” as used here assumes that the individual has a controlling interest as defined in section 2-14.1-8(h), Hawaii Administrative Rules.}