Campaign Spending Commission

     This Advisory Opinion rescinds Advisory Opinion No. 99-07; and provides guidance regarding reporting by political parties and committees “financed, maintained, or controlled” by the parties.

     The Campaign Spending Commission (Commission), in Advisory Opinion No. 99-07, determined that:

• “(C)ounty, District, or local party organizations may choose to register and file reports separately or combine their reports with the state or central committee (of a political party);”
• The political party and its committees “shall not collectively accept more than $25,000 from any single person or entity in a two-year election period;” and
• The “political party and its committees” may contribute per election period not more than: $2,000 to a candidate for a two-year office; $4,000 for a four-year office; and $6,000 for a statewide office.

     The Commission made an accommodation in Advisory Opinion No. 99-07 to allow a party’s state central committee and county/district committees to be registered with the Commission and to allow separate reporting because of difficulties encountered in timely reporting.

     However, there no longer is a reason for allowing separate reporting by a party’s state central committee and the county/district committees because the Commission’s web-based filing system for noncandidate committees, including political parties, will soon be implemented. The system will allow persons throughout the State to enter data simultaneously.

     The Commission, therefore, rescinds Advisory Opinion 99-07.

     Effective with the supplementary report due on July 28, 2005 (for the period from January 1 through June 30, 2005), a political party’s1 state central committee, county committees,2 and any other committees “financed, maintained or controlled”3 by the party’s state central committee shall file a combined report.

     A single $25,000 contribution cap is applicable to donors to a party’s state central committee, county committees, and any committee “financed, maintained, or controlled” by the party.4Moreover, the party, county committees and any committee “financed, maintained, or controlled” by the party are subject to a single contribution cap of $2,000 to a candidate for a two-year office; $4,000 for a four-year office; and $6,000 for a statewide office.5

     However, if a noncandidate committee is not “financed, maintained, or controlled” by the party:

• The committee is not required to file a combined report with the party;
• A donor may contribute an aggregate amount that is not more than $1,000 per election6 to the committee and those amounts are not combined with the donor’s contribution to the party; and
• The committee’s contributions to a candidate are not combined with the party’s contribution to the same candidate.7

     While the term “financed, maintained, or controlled” is not defined in the Commission’s laws or rules, the Federal Election Commission (FEC) has a similar standard. If a committee is “established or financed or maintained or controlled”8 (“affiliated”) with another committee the federal contribution limit is shared.9 The FEC’s rules provide the following guidelines to determine whether a committee is “affiliated”10.

• Whether a sponsoring organization owns a controlling interest in the voting stock or securities of the sponsoring organization of another committee;

• Whether a sponsoring organization or committee has the authority or ability to direct or participate in the governance of another sponsoring organization or committee through provisions of constitutions, bylaws, contracts, or other rules, or through formal or informal practices or procedures;
• Whether a sponsoring organization or committee has the authority or ability to hire, appoint, demote or otherwise control the officers, or other decision making employees or members of another sponsoring organization or committee;
• Whether a sponsoring organization or committee has a common or overlapping membership with another sponsoring organization or committee which indicates a formal or ongoing relationship between the sponsoring organizations or committees;
• Whether a sponsoring organization or committee has common or overlapping officers or employees with another sponsoring organization or committee which indicates a formal or ongoing relationship between the sponsoring organizations or committees;
• Whether a sponsoring organization or committee has any members, officers or employees who were members, officers or employees of another sponsoring organization or committee which indicates a formal or ongoing relationship between the sponsoring organizations or committees, or which indicates the creation of a successor entity;
• Whether a sponsoring organization or committee provides funds or goods in a significant amount or on an ongoing basis to another sponsoring organization or committee, such as through direct or indirect payments for administrative, fundraising, or other costs;
• Whether a sponsoring organization or committee causes or arranges for funds in a significant amount or on an ongoing basis to be provided to another sponsoring organization or committee;
• Whether a sponsoring organization or a committee or its agent had an active or significant role in the formation of another sponsoring organization or committee; and
• Whether the sponsoring organizations or committees have similar patterns of contributions or contributors which indicates a formal or ongoing relationship between the sponsoring organizations or committees.

     The Commission has previously relied upon the FEC’s rules for guidance.11 The Commission, therefore, will consider all the circumstances, including the factors in the FEC’s rules, to determine whether a committee is “financed, maintained, or controlled” by the party.

     The Commission provides this Advisory Opinion 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, March 9, 2005.

CAMPAIGN SPENDING COMMISSION

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Paul Kuramoto
Vice-Chair

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Steven E. Olbrich
Commissioner

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Gino L. Gabrio
Commissioner

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Dean Robb
Commissioner

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1 “Political party” means any party which has qualified as a political party under sections 11-62 and 11-64 and has not been disqualified by this section. A political party shall be an association of voters united for the purpose of promoting a common political end or carrying out a particular line of political policy and which maintains a general organization throughout the State, including a regularly constituted central committee and county committees in each county other than Kalawao.See section 11-61, Hawaii Revised Statutes (HRS).

2 The Commission reiterates its presumption that the county committees are “financed, maintained or controlled” by the party’s state central committee.

3 Section 11-204(f), HRS.

4 Section 11-204(k), HRS.

5 Section 11-204(a), HRS.

6 Section 11-204(b), HRS; Advisory Opinion No. 99-8.

7 All requirements of Hawaii’s campaign spending law must be met. See, for example, section 11-204(j), HRS. ” 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.”

8 2 U.S.C. 441a(a)(5); Title 11 of the Code of Federal Regulations, Section 100.5(g).

9 The Federal Election Commission may “examine the relationship between organizations that sponsor committees, between the committees themselves, or between one sponsoring organization and a committee established by another organization to determine whether committees are affiliated.” Title 11 of the Code of Federal Regulations, Section 110.3(a)(1).

10 Title 11 of the Code of Federal Regulations, Section 110.3(a)(3)(ii).

11 Advisory Opinion No. 2004-05; and Advisory Opinion No. 98-15.