CSC Newsletter – July 2023, Vol. 29, No. 2Posted in Newsletter
WRAP-UP OF THE 2023 LEGISLATIVE SESSION AND MAHALO TO THE COMMISSION TO IMPROVE STANDARDS OF CONDUCT
The 2023 legislative session was a remarkable and historic session for the Hawaii Campaign Spending Commission (“Commission”) with an unprecedented number of bills positively affecting campaign finance that were signed into law. We want to thank the House Speaker, Senate President, House and Senate Judiciary committee chairs and members, Governor Green, the members of the Commission to Improve Standards of Conduct (“CISC”) (also known as the Foley Commission), and the public who supported our efforts.
For the 2023 legislative session, the Commission submitted 11 bills to the legislature which were all supported by the CISC which was established by House Resolution No. 9 (2022) to ensure state laws and rules relating to standards of conduct of public officers and employees contain clear standards, enforcement, and penalties, and provide recommendations to increase awareness of, compliance with, and deterrent effects of the code of ethics, lobbying laws, campaign finance laws, and other relevant laws and rules.
Of the 11 Commission bills that were introduced, only 4 did not pass. Specifically, they were a bill that (1) increased the partial public funding program and established 2 full-time positions in the Commission; (2) extended the pay-to-play state and county government contractor ban to grants-in-aid recipients as well as owners, officers, and immediate family members of the government contractor/grantee; (3) prohibited candidates from using campaign funds to purchase up to 2 tickets for another candidate or committee’s fundraiser; and (4) prohibited elected officials from accepting and soliciting contributions during legislative session. The Commission will continue its efforts to advocate for these bills in the future, but is grateful to have made positive progress in the area of transparency and accountability in campaign finance.
NEW LAWS GOING INTO EFFECT
From the 2022 and 2023 legislative sessions, the following laws affecting campaign finance will be going into effect:
1 – DARK MONEY: Effective January 1, 2023, noncandidate committees who are 501(c)(4) nonprofit organizations must provide written notice to donors that their name and address will be reported to the Commission if they make a donation individually or in an aggregate of more than $10,000 and permit that donation to be used for electioneering communications, independent expenditures, or political contributions. (Act 169, SLH 2022)
2 – ELECTIONEERING COMMUNICATIONS: Effective January 1, 2023, noncandidate committees shall file an electioneering communication statement no later than 24 hours of an electioneering communication of more than $2,000 being publicly distributed within 30 days of the primary election (i.e., July 11, 2024 to August 10, 2024) and/or 60 days of the general election (i.e., September 6, 2024 to November 5, 2024). Once the $2,000 threshold is reached, noncandidate committees must continue to file all subsequent electioneering communication forms regardless of the amount. For mailers, the disclosure date means the date the mailers are first mailed. The Statement of Information for Electioneering Communications form has been updated and is available on the Commission’s website. (Act 169, SLH 2022)
3 – FUNDRAISER NOTICES: Effective January 1, 2023, elected state and county officials are prohibited from holding a fundraiser or fundraiser event to raise contributions for which any price is charged or any contribution is suggested for attendance during a regular session or special session of the state legislature. (Act 283, SLH 2022) Also, effective March 31, 2023, all candidate and noncandidate committees must file their fundraiser notices regardless of the price or suggested contribution for attending the function. (Act 4, SLH 2023)
4 – PUBLICATION OF COMMITTEE NAMES FOR COMMITTEE REGISTRATION VIOLATIONS: Effective March 31, 2023, any candidate or noncandidate committee who fails to register with the Commission or correct their organizational report will have their name published on the Commission’s website until they comply. (Act 5, SLH 2023)
5 – PUBLICATION OF THE LEGAL NAME OF CANDIDATES: Effective June 23, 2023, if the candidate name requested to be printed on the ballot is different than the candidate’s legal name, the Office of Elections and the Commission will include the candidate’s legal name wherever the name requested to be printed on the ballot is used. (Act 117, SLH 2023)
6 – LOWER THRESHOLD FOR NONCANDIDATE COMMITTEES TO REGISTER WITH THE COMMISSION: Effective June 23, 2023, noncandidate committees must register with the Commission by filing an Organizational Report within 10 days of receiving contributions or making expenditures of more than $500 (used to be $1,000), in the aggregate, in a 2-year election period. (Act 122, SLH 2023)
7 – NEW 4th PRELIMINARY PRIMARY REPORT FOR CANDIDATE COMMITTEES: Effective January 1, 2026, candidates whose name will appear on the ballot in the 2026 election, must file a preliminary primary report on February 28 of the year of a general election. (Act 119, SLH 2023)
8 – CASH CONTRIBUTION RESTRICTION: Effective March 31, 2023, a candidate, candidate committee, and noncandidate committee shall limit to $100 the total amount of cash they may accept from a single person during each election period. (Act 6, SLH 2023)
9 – LOBBYIST CONTRIBUTIONS PROHIBITED DURING SESSION: Effective June 23, 2023, lobbyists who are actively registered with a State or county ethics board or commission are prohibited from contributing to an elected official, candidate, candidate committee, noncandidate committee, or any other individual required to file an Organizational Report with the Commission, or making an expenditure on behalf of these persons, during any regular or special session of the legislature, and for 5 calendar days before and after a session. Any prohibited contribution shall escheat to the Hawaii Election Campaign Fund. (Act 128, SLH 2023)
10 – INCREASED FINES FOR NONCANDIDATE COMMITTEE VIOLATIONS – ORGANIZATIONAL REPORTS AND ADVERTISEMENTS: Effective July 1, 2023, a noncandidate committee who: (1) fails to comply with Organizational Report requirements is subject to a minimum fine of $1,000 per violation; (2) fails to have the proper advertisement disclaimer is subject to a fine of no less than $150 for each advertisement; and (3) fails to identify the top 3 contributors to advertisements paid by Super PACS is subject to a fine of $1,000 per violation. (Act 127, SLH 2023)
11 – INCREASED FINES FOR SUPER PAC VIOLATIONS: Effective June 23, 2023, the fine for noncandidate committees making only independent expenditures (Super PACs) that have received at least one contribution of more than $10,000, or spent more than $10,000 in an election period, is increased to an amount not to exceed $5,000 for each occurrence or an amount not to exceed three times the amount of the unlawful contribution or expenditure for a campaign finance violation. Further, if the noncandidate committee cannot pay, the Commission may order that the fine be paid from the personal funds of the candidate or officers of the noncandidate committee (i.e., chairperson and/or treasurer). (Act 121, SLH 2023)
12 – CAMPAIGN SPENDING COMMISSION COMPLAINTS: Effective June 23, 2023, there is a rebuttable presumption that a campaign finance violation has occurred for respondents who fail to explain or otherwise respond to complaints alleging campaign spending violations within 30 days from the mailing of the complaint. (Act 118, SLH 2023)
13 – CAMPAIGN SPENDING COMMISSION’S PRELIMINARY DETERMINATION OF PROBABLE CAUSE ORDERS: Effective June 7, 2023, service of the Commission’s preliminary determination of probable cause orders will be done by first class mail rather than certified mail and a courtesy copy will be sent by email (if the email address is known by the Commission). Further, there shall be a presumption that the committee received the order within 7 business days of the order being mailed. (Act 69, SLH 2023) Effective June 23, 2023, a person waives the right to a contested case hearing if they fail to request a contested case hearing within 30 days of receipt of the Commission’s preliminary determination of probable cause order. Further, a final order of the Commission may be filed in First Circuit Court for confirmation as a civil judgment, enforceable and collectible as any other judgment issued in the circuit courts. (Act 120, SLH 2023)
14 – NEW CRIMINAL OFFENSE OF OFFICIAL MISCONDUCT: Effective June 23, 2023, it shall be a class C felony for the offense of official misconduct which prohibits a public servant from acting or refraining from performing an official duty with the intent to obtain a benefit other than the person’s lawful compensation, or submitting or inviting reliance on any false statement, document, or record. The adoption of the felony offense of official misconduct gives law enforcement/prosecutorial authorities an important tool to combat public corruption. (Act 130, SLH 2023)
15 – NEW CRIMINAL OFFENSE OF FALSE, FICTITIOUS, OR FRAUDULENT CLAIMS AGAINST THE STATE/COUNTY: Effective June 29, 2023, there are 3 new felonies: (1) A class B felony for the offense of fraud if, with the intent to defraud, the person executes or attempts to execute any scheme or artifice to defraud or for the purpose of obtaining money or property by means of false or fraudulent pretenses, representations, or promises including to deprive another of the intangible right of honest services; (2) A class C felony for the offense of making a false, fictitious, or fraudulent claim against the State or county if the person makes or presents to any agent of the State, counties, or any department or agency thereof any claim upon or against the State, county, department, or agency that the person knows to be false, fictitious, or fraudulent; and (3) A class C felony for the offense of using false statements or entries in matters within the jurisdiction of the executive, legislative, or judicial branches of the State. The adoption of the offense of honest services fraud gives law enforcement/prosecutorial authorities an important tool to combat public corruption. The felony offense of the use of false statements or entries may be applicable to reports filed with the Commission. (Act 131, SLH 2023)
16 – NEW CRIMINAL OFFENSE OF OBSTRUCTION OF JUSTICE: Effective June 29, 2023, it shall be a class B felony for the offense of obstruction of justice if a person intentionally influences, obstructs, impedes, or endeavors to influence, obstruct, or impedes the due administration of justice by means of force, threat of force, coercion, fraud, or deception. The adoption of the offense of obstruction of justice gives law enforcement/prosecutorial authorities an important tool to combat public corruption. The felony offense of obstruction of justice may be applicable to deceptive statements made to the Commission. (Act 137, SLH 2023)
REMINDER TO ALL COMMITTEES TO FILE THE SUPPLEMENTAL REPORT – DUE ON JULY 31, 2023
The next report for all candidate committees and noncandidate committees is the Supplemental Report covering the period January 1, 2023 to June 30, 2023. This report must be electronically filed on your respective filing systems (i.e., candidate filing system (CFS) or noncandidate committee filing system (NCFS)) no later than 11:59 p.m. Hawaiian standard time on Monday, July 31, 2023.
Failure to file this report by the deadline will result in a fine and, if you are a candidate committee or noncandidate committee, your committee’s name will be posted on the Commission website under “Candidate Committees That Failed to File or Correct a Report” or “Noncandidate 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. Therefore, we encourage all committees to timely file their reports.
As a reminder, committees do not have to wait until the July 31st deadline to file the report. The reporting period for the Supplemental Report ended on June 30th so the report can be filed as early as July 1st, but no later than July 31st.
New reporting schedules have been posted on our website and are provided via the link below for your convenience to track upcoming reporting deadlines. The reporting schedules are also available in the Commission’s downloadable calendar and can be downloaded to your digital calendar on your computer or mobile device.
The Commission will add the necessary reports to your reporting schedule in your respective electronic filing system (CFS and NCFS). These reports must be electronically filed no later than 11:59 p.m. Hawaiian standard time on the day of the deadline. You may also want to consider filing the reports early to avoid penalties because the reporting deadline is always a few days or weeks after the reporting period has closed.
Failure to file any report by the deadline will result in a fine and the name of your committee will be posted on the Commission’s website under “Candidate Committees That Failed to File or Correct a Report” or “Noncandidate Committees That Failed to File or Correct a Report.” Further, 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. Therefore, we encourage all committees to timely file their reports and pay any fines.Lastly, please remember that when you electronically file your reports with the Commission, candidates, treasurers, and chairpersons (for noncandidate committees) are certifying that the information contained in the filed reports are true, complete, and accurate. Therefore, it is strongly advised that you verify and validate your reports before you file them since the Commission will rely on the electronically filed information which could generate an inquiry/investigation if inaccurate.
UPDATING ORGANIZATIONAL REPORTS
As of July 1, 2023, candidate committees that login to the candidate filing system (CFS) and noncandidate committees that login to the noncandidate committee filing system (NCFS) will be presented with their Organizational Report. Please take the time to review your Organizational Report and make any needed changes.
Hawaii Revised Statutes (“HRS”) §§11-322(b) and 11-323(b) provide that any change in information previously reported in the organizational report shall be electronically filed with the commission within 10 days of the change being brought to the attention of the committee chairperson or treasurer. Failure to do so may result in a fine as well as prevent the Commission from communicating with you.
Also, if you are a candidate who intends to run for office in the next election and would like to carry over surplus campaign funds, you must file an amended Organizational Report on the CFS. This applies to candidates who failed to be elected to office who will be running again and candidates who are elected to office who will be running again for a different office to which they were elected and includes term-limited candidates.
TERM LIMITED CANDIDATES
If you are a candidate who is term limited for the office for which you presently occupy, contributions may be sought only if the committee has no surplus and has debt, unpaid expenses, or unpaid loans. See, Hawaii Administrative Rules (“HAR”) §3-160-31(b)(2). If this does not apply and you intend to seek contributions to run for elective office in the next subsequent election, then you must amend your Organizational Report to notify the Commission and the public of the office you intend to run for within 10 days of receiving contributions or making or incurring expenditures of more than $100 for that office. The contribution limits of the 2024 or 2026 election period will apply to these contributors.
TERMINATION OF COMMITTEE REGISTRATION WITH THE COMMISSION
If you are a candidate who does not anticipate running in a future State or county election, or you are a noncandidate committee that does not intend to participate in future State or county elections, and your committee has no surplus or deficit in campaign funds, you may want to consider terminating your registration with the Commission. If so, you will need to complete and submit the following documents: (1) A “Request for Termination of Registration” form for candidate committees or “Request for Termination of Registration” form for noncandidate committees; and (2) A closing bank statement verifying that your committee’s bank account has been closed. If your committee had receipts or expenditures after the disclosure period of the most recent report filed by your committee, you will need to electronically report those receipts and expenditures. Further, you must not have any outstanding fines or unresolved matters with the Commission. Assuming everything is in order, the Commission will approve your termination request and you will no longer be required to electronically file reports with the Commission.
VIOLATIONS OF THE CAMPAIGN FINANCE LAWS
The following candidate committees violated the Hawaii campaign finance laws and have failed to comply with the Commission’s orders by refusing to file required disclosure reports and/or pay assessed fines. Pursuant to HRS §11-410(d), the Commission has been pursuing enforcement actions with the assistance from the Attorney General’s Office – Civil Recoveries Division. Furthermore, pursuant to HRS §11-156, a candidate who has unfiled disclosure reports or unpaid fines will not receive a certificate of election should that candidate win in a subsequent election.
- Thomas Belekanich, Friends of Tom Belekanich
- Henry Cho
- Shaena Hoohuli, Hoohuli Headquarters
- Kukana Kama-Toth, Friends of Kukana Kama-Toth
- Mela Kealoha-Lindsey, Friends of Mela Kealoha-Lindsey
- Candace Linton
- Lono Mack, MACK
- Ryan Malish, 808Ryan4Senate
- Frederick Nava, Rick Nava, Friends of Rick Nava
- Chris Toafili, Chris Toafili
- Daniel Wade, Friends of Dan Wade
- Laurent Zahnd, Team Mr L – Laurent R.B. Zahnd (L) for Mayor
MAHALO TO COMMISSIONERS BRYAN LUKE AND MARYELLEN MARKLEY; WELCOME NEW COMMISSIONERS DAVID CHEE
The Commission is composed of five volunteers representing the general public who are appointed by the governor from a list of ten nominees submitted by the judicial council. Having served two 4-year terms from July 1, 2015 to June 30, 2023, Commissioner Bryan Luke who also served as Chair from May 2016 to September 2021, completed his final term on June 30, 2023. Also, Commissioner Maryellen Markley who served as Vice-Chair from September 2021 to November 2022 resigned effective November 30, 2022. We extend our warmest gratitude to Commissioners Luke and Markley for their many years of service, guidance, stewardship, and dedication in ensuring transparency in campaign finance in several elections in the State of Hawaii.
We also extend our warmest welcome to our new Commissioner. In March 2023, David Chee was selected to serve on the Commission for the remainder of Commissioner Markley’s term which expires on June 30, 2025. David Chee was born and raised in Honolulu. In 1988, he received a B.S. in Civil Engineering from the University of Washington, and in 1992, a J.D. from the William S. Richardson School of Law at the University of Hawaii. He has a small law firm that concentrates on real estate litigation. He enjoys traveling and spending time with his family.
WELCOME NEW ELECTIONS ASSISTANT TERENCE LAU AND ADMINISTRATIVE ASSISTANT KARIN GILL
The Commission would like to welcome new Elections Assistant Terence Lau who started with the Commission in May 2023. Terence was born and raised in Hong Kong, China, then immigrated to Hawaii in 2001 with his parents and elder sister. He graduated from the University of Hawai’i at Manoa in Accounting with a strong focus on Japanese Literature. He was formerly a Testimony Coordinator for the Hawaii State Legislature during the legislative sessions in 2021, 2022, and 2023, where he coordinated, monitored public hearings, and provided live IT support on Zoom. He also served as an Adjudicator for the Unemployment Insurance Claims Office in 2021 to help relieve the overflowing claim issues resulting from the COVID-19 pandemic. In his spare time, he enjoys competing and organizing video game tournaments, as well as watching movies at home with his pet bird and fish. He is the Elections Assistant at the Commission to provide support in analyzing and reporting on data relating to election campaign spending.
The Commission would also like to welcome new Administrative Assistant Karin Gill who started with the Commission in June 2023. Karin graduated from the University of Hawai’i at Hilo and is a long-term resident of Hawai’i. She has held paralegal positions with the Office of the U. S. Attorney, District of Hawaii, the State of Hawai’i Department of the Attorney General, and in the private and non-profit sectors. She also served as Legislative Office Manager at the State of Hawai’i House of Representatives. She was born in Helsinki, Finland, and spent her childhood in Latin America during the time her parents worked for UNESCO and the World Health Organization. She enjoys time with her family, ocean sports, travel, and cooking. She serves as the office manager providing assistance in budgetary, financial, procurement, government, legislative, legal, and other matters related to the daily operations of the Commission. She is also secretary to the Commission and manages all Commission records and files.
The Commission is grateful to have its team on board and encourage everyone to welcome them.