Campaign Spending Commission

CSC Newsletter – July 2014, Vol. 20, No. 2

2014 ELECTION OBSERVATIONS

In 2014, there are 298 candidates running for 102 seats up for election out of 128 elective seats in the state of Hawaii and its four counties. The 102 seats up for election this year are: Governor (1), Lt. Governor (1), Senate (13), House (51), Maui Mayor (1), Kauai Mayor (1), Honolulu City Council (4), Hawaii County Council (9), Maui County Council (9), Kauai County Council (7) and OHA (5). View the list of candidates running in 2014 and their organizational reports which includes their committee officers such as their appointed chairperson and treasurer.

Twelve (12) candidates are unopposed this year and eleven (11) incumbent candidates have decided not to run for their seat. 160 or 54% of the 298 candidates running this year have filed the Affidavit to voluntarily agree with the expenditure limit set for their office and 48 or 16% of the 298 candidates running this year have filed the Statement to notify the Commission of their intent to seek partial public funding. View the list of Affidavit filers and the list of Statement filers.

So far this year, three (3) candidates have received a total of $8,969 in partial public funding. Felicia Cowden running for Kauai Council has received $5,089, Michael Golojuch running for State House has received $1,720, and Rose Martinez running for State House has received $2,160. Future updates can be viewed on the “Public Funds Disbursed” page.

Also, 172 fundraisers have been held in 2014 with 49 of those fundraisers being held during the legislative session by State legislators. View a list of fundraisers held in 2014 and an interactive chart of the same information.

Good luck to all candidates this year!

REMINDER OF UPCOMING REPORTS

The following reporting schedules are provided for your convenience to track upcoming reporting deadlines:

These reports must be electronically filed on your respective filing systems (i.e., candidate filing system (CFS), noncandidate committee filing system (NCFS), and corporate reporting system (CRS)) no later than 11:59 p.m. Hawaiian standard time on the day of the deadline. Failure to file any of these reports by the deadline will result in a fine and, if you are a candidate committee, posting of your committee’s name on the Commission website under “Committees That Failed to File or Correct a Report.”

Moreover, if a fine is assessed against your committee and you fail to timely pay it, Commission staff will issue a complaint against your committee and set it for consideration at the next public Commission meeting. Be advised that at this meeting it is very possible that a higher fine may be assessed. Therefore, we encourage all committees to timely file their reports and pay any fines. As a reminder, the reporting deadline is always a few days after the reporting period is over so you can always file the report early to avoid any penalties.

NEW LEGISLATION FROM THE 2014 LEGISLATIVE SESSION

For the 2014 legislative session, the Commission submitted four proposals of which three (3) were signed into law and one which we have proposed multiple times which continues to get deferred. They are:

o House Bill 1602 & Senate Bill 2117 companion – Deferred by Senate Judiciary and Labor Committee. Sought to amend HRS §11-334(a)(4) to require supplemental reports to be filed by candidate committees on January 31st regardless of whether it is an election year or not. This comports with present practice as well as conforms this requirement with noncandidate committees.

o House Bill 1603 & Senate Bill 2118 companion – Senate Bill 2118 was signed into law as Act 140 on June 24, 2014. Act 140 amends HRS §11-426 by replacing the Chief Elections Officer with the Office of Elections as the entity who must be notified if a candidate who filed an affidavit agreeing to limit expenditures exceeds that expenditure limit. The requirement that a candidate reports to the office rather than the officer is more practical. Further, the candidate must notify his/her contributors that they have exceeded the expenditure limit. Also, deletes the reference to a tax deduction for contributions to candidates who file the affidavit because this is no longer available.

o House Bill 1604 & Senate Bill 2119 companion – House Bill 1604 was signed into law as Act 139 on June 24, 2014. Act 139 amends HRS §11-156 to clarify that certificates of election shall not be delivered to candidates who have not filed disclosure reports with the Commission and further adds the requirement that candidates must have paid all outstanding fines owed to the Commission.

o House Bill 1605 & Senate Bill 2120 companion – Senate Bill 2120 was signed into law as Act 48 on April 23, 2014. Act 48 amends subsection (b) of HRS §11-359 (Family Contributions) by replacing the reference to HRS §11-355 (Contributions by state and county contractors prohibited) with HRS §11-357 (Contributions to candidates committee; limits), as the exemption for contributions to candidates from immediate family members. This conforms HRS §11-359 with the law prior to the recodification of HRS Chapter 11 in 2010.

NEW – COMMISSION RELEASES UPDATE TO CANDIDATE FILING SYSTEM EXPENDITURE AND UNPAID EXPENDITURE SCHEDULES

Effective July 3, 2014, candidate committees have a new field to complete concerning campaign expenditures in the Candidate Filing System (CFS). The new “Authorized” drop-down is a required field in the CFS that must be completed for any new expenditures or unpaid expenditures entered on Schedule B or Schedule E from the time of the updated release at 8:00 am on July 3, 2014. Any expenditure or unpaid expenditure entries entered on Schedule B or Schedule E prior to this updated release will not require the completion of this new field. However, completion of this new field will be required for any new expenditures or unpaid expenditures entered as part of an amended filing.

This modification is meant to track the campaign finance law which provides that candidates may use campaign funds for one of eight authorized uses: (1) Directly Related to Candidate’s Campaign; (2) Charitable Donations; (3) Public School or Public Library Donations; (4) Full-Time Student Scholarship Awards; (5) Two (2) Fundraiser Tickets; (6) Political Party Contributions; (7) Ordinary and Necessary Expenses as an Office Holder; and (8) Mixed Benefit Expenses. See, HRS §11-381.

Please click here for a full explanation of the eight authorized use categories.

MODIFICATIONS TO THE NONCANDIDATE COMMITTEE FILING SYSTEM

To increase transparency in the reporting of independent expenditures, the 2013 Legislature passed Senate Bill 31 which Governor Neil Abercrombie signed into law on June 14, 2013 as Act 111. This law requires noncandidate committees making independent expenditures to report the name(s) of the candidate(s) and whether an independent expenditure is in support or opposition to the candidate(s). As a result of this new reporting requirement, the Commission has modified the NCFS with the assistance from ICSD.

REPEAL OF THE CORPORATE REPORTING SYSTEM

Effective November 5, 2014 (or the day after the 2014 General Election), Act 112, Session Laws of Hawaii 2013, repealed the Corporate Reporting System. Therefore, this electronic filing system will no longer be available after the effective date. Corporations engaging in political activity regulated by the Commission will be required to register as noncandidate committees and report their activities on the noncandidate committee electronic filing system (NCFS). Please contact us for information including registering as a noncandidate committee or refer to the Guidebook for Noncandidate Committees for further information.

REMINDER OF THE COMMISSION’S DATA VISUALIZATION APP FOR CANDIDATE COMMITTEES

Are you interested in seeing candidates’ reports in a more visually attractive, user-friendly, and dynamic way? Last year, we launched the candidate data visualization app on our website which permits you to view charts of a candidate’s campaign spending data for a particular election period. You will be able to view a pie chart of a candidate’s contributions to see how much and what percentage of their contributions are funded by individuals, noncandidate committees, political parties, immediate family members, etc. You will also be able to see how much and what percentage of a candidate’s contributions are coming from in-state versus out-of-state, from which states and zip codes, as well as by geographical location. There is also a visual chart showing how much and what percentage of a candidate’s contributions are $1,000 or less and more than $1,000.

As for campaign expenditures, a pie chart will show how much and what percentage of a candidate’s spending was for advertising, food & beverage, printing, professional services, surveys/polls/voter lists, etc., as well as a chart showing in-state versus out-of-state spending. The data is derived from the candidates’ reports which are filed electronically with the Commission from the last 6 years. This application was conceived to provide greater transparency and accountability in government and to enable the public to follow the money of candidates running for state and county offices in Hawaii.

NEW – DATA VISUALIZATION APP FOR NONCANDIDATE COMMITTEES

The Commission will soon be announcing the launch of the noncandidate committee data visualization app. In partnership with the State’s Office of Information Management & Technology (OIMT), Information and Communication Services Division (ICSD), and Socrata, you will be able to view charts of a noncandidate committee’s campaign spending data for a particular election period. Similar to the candidate app, this app will permit you to view pie charts, a geo-map and a bar chart from data derived from the noncandidate committees’ reports which are filed electronically with the Commission from the last six (6) years.

New charts include a chart for fundraiser notices, a chart showing noncandidate committee contributions to candidates categorized by office, and a chart showing noncandidate committee contributions to candidates categorized by party. This application was conceived to provide greater transparency and accountability in government and to enable the public to follow the money of noncandidate committees’ participation in the elections in Hawaii.

NEW – CYBER-LEARNING VIDEOS

We have launched new cyber-learning videos for the 2014 election so that you have a resource 24/7 to learn how to file your disclosure reports electronically using your filing system. These videos were created as a companion to the Candidate Filing System (CFS) Manual to help you learn how to use the CFS. The videos therefore cross-reference the table of contents in the CFS Manual (also available on our website) and can be used simultaneously with the manual (or by themselves). We believe that viewing the short videos by specific subject matter can speed up your learning by giving you a visual of how certain tasks are completed in the CFS. View the cyber-learning videos.

NEW – GUIDEBOOKS & MANUALS

We rewrote our committee guidebooks and manuals for the 2014 election. These resources are intended to assist you in understanding campaign finance laws and rules as well as how to file your disclosure reports electronically using the candidate filing system (CFS) and the noncandidate committee filing system (NCFS). View the candidate guidebooks & manual and the noncandidate committee guidebooks and manual.

CIVIC*CELERATOR APPLICATIONS

Recently, coders, designers, developers, entrepreneuers, students, civic innovators, and engaged citizens converged in a Civic*Celerator competition to showcase apps they created using campaign finance open data to show how state and local candidates are being funded as well as how candidates are spending campaign funds. This event was sponsored by Common Cause and Hawaii Open Data to bring together people from all aspects of the community to create applications to equip voters with tools to help them understand who is funding political campaigns. Go to https://civic.celerator.org/apps to view these apps. A warm mahalo to all those who participated at this competition and to Common Cause and Hawaii Open Data for their support and interest in campaign finance.

HAWAII COUNTY COUNCIL COMPREHENSIVE PUBLIC FUNDING

Pursuant to Act 244, SLH 2008, the Hawaii Election Campaign Fund has insufficient funds to provide comprehensive public funding to Hawaii County Council candidates in the 2014 election. Hawaii County Council candidates may however seek partial public funding options.

REVISING HAWAII ADMINISTRATIVE RULES FOR THE COMMISSION

The Commission is seeking the approval from the Governor to conduct a public hearing on proposed amendments to Chapter 3-160 (Election Campaign Contributions and Expenditures) and Chapter 3-161 (Administrative Practice and Procedures Before the Commission) of the Hawaii Administrative Rules. The proposed amendments for the most part updates obsolete references to the HRS and makes technical and grammatical corrections. It also proposes a new section that implements section 2 of Act 112, Haw. Sess. Laws 2013, which requires noncandidate committees only making independent expenditures (also called SuperPacs) to identify its top contributors in their advertisements. The proposed rules will be posted on the Commission’s website once the Commission receives approval from the Governor to proceed with a public hearing.

McCUTCHEON v. FEC – NEW U.S. SUPREME COURT CASE

In McCutcheon v. FEC, 572 U.S. ___ (2014), a case decided on April 2, 2014, the Court struck down the biennial aggregate limit on individual contributions to federal candidates and national parties. The Federal Election Campaign Act of 1971 (FECA), as amended by the Bipartisan Campaign Reform Act of 2002, mandated a contribution ceiling for an individual (during the 2011-2012 election cycle) of $46,200 for federal candidates and $70,800 for national parties. In addition to the aggregate limits, FECA also has contribution limits that applies per candidate and per party. Only the aggregate limits were at issue in McCutcheon. The Court, in a 5-4 vote, ruled that the aggregate limits violated the First Amendment. Hawaii’s Campaign Finance Law, HRS §11-301, et seq., does not provide for aggregate limits on an individual’s contributions to state and local candidates or parties. Although the decision in McCutcheon does not have a direct effect on Hawaii law, it is interesting to note that Justice Thomas, in a concurring opinion, would abolish all contribution limits (by subjecting them to strict scrutiny), not just aggregate limits.

REMEMBER TO CHECK OFF $3 ON YOUR TAX RETURN

The Commission operates from a trust fund called the Hawaii Election Campaign Fund. This fund depends on Hawaii taxpayers checking off the box on their state income tax form which permits $3 from state funds (or $6 if married and filing a joint return) to be allocated to our trust fund. Tax filers are informed that participation is voluntary and does not increase their tax or reduce their refund. Monies in this campaign fund help to provide accountability, transparency, and integrity by providing public funding to candidates as well as pays for the operational expenses of the Commission.

UPCOMING EVENTS

Be on the lookout for the following events which we will post on our website and Facebook accounts, e-blast to subscribers, and tweet when they are available. 1 – The Commission’s Annual Online Survey for 2014 – We are planning to post our annual online survey on our website in July/August 2014. Please take a moment to complete this survey as it will help us improve our services and give us a chance to hear from you. The results of the online survey will then be posted on our website. 2 – FY 2014 Annual Report – We will post and publish our annual report for fiscal year 2014 once we have obtained Commissioners’ approval in September 2014.