Enacts the New York State clean election campaign finance reform act; repealer

Summary and description of provisions

This bill contains two distinct parts. part A of the bill makes various amendments to Article fourteen of the election law. Part B of the bill establishes a voluntary system of public financing of state campaigns.

The enforcement provisions (Part A) would provide for the first comprehensive and effective system for the enforcement of campaign finance law in modern New York history. An independent Office of Campaign Finance Enforcement would be created within the state Board of Elections, whose head officer would be nominated by the governor from a list of nominees prepared by a bipartisan Board of Elections advisory committee on which the public would be represented. The Office would have relevant investigatory and enforcement authority, with procedures to ensure fairness, due process, appropriate time to recognize and cure violations, and then rigorous enforcement against violators. The office would also be responsible for policing the public financing system to ensure all candidates are complying with the law.

The voluntary system of public financing (Part B) would provide for New York's first comprehensive and effective system of voluntary clean money public financing of state campaigns, seeking to untether politics from the grip of special interests. Modeled on best practices nationwide, the system would provide for a qualifications process based on a designated number of small contributions, and then public funds to provide qualifying candidates with meaningful resources for clean campaigns. Funds would be subject to strict controls on personal use and recordkeeping requirements to ensure proper use of public funds, consistent with this act.

PART A PROVISIONS

Section one:

- Repeals (7) of section 3-102 of the election law.

- Section 3-102(3)of the election law is amended to provide the office of campaign finance enforcement, established pursuant to section 14-132 of this act with jurisdiction to carry out investigations of both article 14 (existing campaign finance law) and article 14-A (added to govern public financing).

- Section 3-102(6) of the election law provides the office of campaign finance enforcement with the power to investigate alleged offenses, prosecute said offenses, and collect civil penalties.

Section 2:

- Amends election law section 3-104(1) to provide the state campaign finance board, established pursuant to section 3-101 of the election law, with the jurisdiction to oversee the public financing system. Additionally, the office of campaign finance enforcement, established pursuant to section 14-132 is granted jurisdiction over all of Article fourteen, including the public financing system.

Section 3:

- A new section 3-201 is added to the election law creating an advisory committee. Said committee shall be comprised of nine members all of whom serve renewable terms of five years. The advisory committee shall be charged with assisting the state board, including the campaign finance unit. Additionally, they are charged with assisting with nominating a chief campaign finance enforcement officer.

Section four:

- Section 14-126 of the election law is replaced with a new section strengthening penalties for violations.

Section five:

- Amends section 14-127 of the election law regarding the powers of the campaign finance enforcement unit when candidates fail to file or provide requested information.

Section six:

- Amends election law 14-128 and provides for the disposition of anonymous contributions into the clean election campaign fund.

Section seven:

- Adds four new sections to the election law. Section 14-132 establishes within the state board of elections an actual office of campaign finance enforcement, headed by a chief campaign finance enforcement officer. Said officer shall be appointed by the campaign finance advisory board and serve for a renewable term of five years. Said officer shall be charged with enforcing the campaign finance provisions contained in Articles 14 and 14-A.

- Section 14-134 establishes procedures for random audits. Such audits are to be done in a manner where the identity, political affiliation and address of the committee remain anonymous.

- Section 14-136 provides for enforcement in the event the law is amended and the aforementioned powers are transferred to a different enforcement agency.

- Section 14-138 provides for official communication to be sent via email should a candidate so elect.

Section eight:

- A new subdivision (5)is added to section 16-114 to allow the office of campaign finance enforcement to collect fines without having to go to court.

Section nine:

- Amends the executive law to add a new section 63-e to provide the attorney general with concurrent jurisdiction to enforce Articles 14 and 14-A of the election law.

Section ten:

- Adds a new paragraph j-1 to executive law section 94 to provide require the names of lobbyists be filed with the office of campaign finance enforcement.

Part b

Establishes a new Article 14-A within the election law establishing voluntary system of campaign finance.

SECTION 14-150 DEFINITIONS Many of these definitions are already a part of the election law. Others are new and/or different for a full public funding system.

SECTION 14-152 ELIGIBILITY AND OTHER REQUIREMENTS This section explains what a candidate must do in order to be eligible to be a part of the public financing system and what is required of them. It includes how many qualifying contributions are required for each office and some of the guidelines the candidate must abide by:

To be eligible for participation, candidates must meet 10 requirements:

1. Satisfy legal requirements to get their name on the ballot that already exist in the election law (petitions, etc.); 2. Run an office that will be covered under the full public financing system (governor, lieutenant governor, comptroller, attorney general, state senate or assembly in a primary, general or special election); 3. Officially sign up to run as a clean elections candidate using the forms created by the state campaign finance board; 4. Give any financial information about contributions or expenditures, etc. that the board may ask for; 5. Notify the board, and agree that the candidate will only have one committee that will be used for the campaign;

6. Agree that this committee will maintain records of receipts and expenditures for the covered election(s); 7. Agree that the candidate and/or principle committee will not spend more money than authorized by the program; 8. Agree not to accept political party contributions in excess of the amount allowed in the program; 9. Agree to participate in at least two public debates prior to the primary or special election, and at least three public debates prior to the general election; and 10. Agree to pay any outstanding fees to the board of elections if the candidate has them.

The section also explains that the qualifying period for clean elections candidates starts the first day of January of the year in which the election or elections for which the candidate seeks to qualify will be held and ends no later than sixty days before the date of the primary election in that same year.

For special elections, the qualifying period begins the date the special election is announced and the candidate has 14 days to collect the qualifying contributions. In the case of a special election, the number of qualifying contributions shall be half the number required in the general election. Public funds would be given within three days of submission of qualifying contributions for a special election.

Requirements to receive public funds and requirements once a candidate has received funds:

1. Candidates for State Senate: Must collect at least 1,000 qualifying contributions, half of which must come from persons registered to vote in the state senate district. The total amount of qualifying contributions collected by a candidate for state senate shall not exceed $125,000. Any amounts in excess of this limit shall be donated to the New York State clean election campaign finance fund.

2. Candidates for State Assembly: Must collect 400 qualifying contributions, half of which must come from persons registered to vote in the state assembly district. The total amount of qualifying contributions collected by a candidate for state assembly shall not exceed $50,000. Any amounts in excess of this limit shall be donated to the New York State clean election campaign finance fund.

3. Candidates for Governor: Must collect 20,000 qualifying contributions, including at least 500 contributions from persons registered to vote in each of a majority of the congressional districts of the state. The total amount of qualifying contributions collected by a candidate for Governor shall not exceed an amount equal to $2.5 million dollars. Any amounts in excess of this limit shall be donated to the New York State clean election campaign finance fund.

4. Candidates for Lieutenant Governor, Attorney General and Comptroller: Must collect 10,000 qualifying contributions, including at least 250 contributions from persons registered to vote from a majority of the congressional districts of the state. The total amount of qualifying contributions collected by a candidate for governor, attorney general

or comptroller shall not exceed an amount equal to $1.25 million dollars. Any amounts in excess of this limit shall be donated to the New York State clean election campaign finance fund.

Section 14-154 qualified campaign expenditures

Funds may be used for anything on behalf of a candidate to further the candidate's nomination for election during the calendar year in which the election is being held. In addition, this section also outlines what the public funds may NOT be used for, including:

1. Anything that violates current election law;

2. Payments to the candidate or a spouse, child, grandchild, parent, grandparent, brother or sister of the candidate or spouse of such child, grandchild, parent, grandparent, brother or sister, or to a business entity in which the candidate or any such person has an ownership interest or serves as an employee, officer or member of the board of directors;

3. Payments for anything that exceeds the fair market value;

4. Any payments made after a candidate has been disqualified or has his or her petitions finally declared invalid except otherwise permitted in the law;

5. Payments in cash except those prescribed in this article;

6. Any contribution, transfer or loan made to another candidate or political committee;

7. Gifts, except brochures, buttons, signs, and other printed campaign material.

Section 14-156 campaign contributions

Qualified candidates must furnish complete campaign records to the administrative agency on a quarterly basis or upon request.

SECTION 14-158 OPTIONAL CLEAN ELECTION CAMPAIGN FINANCING Outlines who should receive clean elections campaign financing (candidates that qualify) and gives the schedule of payments.

- If a candidate qualifies for public funds prior to reaching ballot status, they will receive only 25% of the primary allotment, until they gain ballot status. Once status is gained, they will receive the other 75% of the primary allotment, unless they are unopposed, in which case they will only receive the initial 25%. A candidate who receives a party nomination for the general election or who is nominated for the general election ballot by independent nominating petition and who qualifies for clean elections funds for the general election shall receive the grant of public funds for the general election within three days after the date of the primary election.

- Even if a candidate is nominated in more than one party, he/she can only receive funding as one candidate.

SECTION 14-160 GRANT AMOUNTS FOR PRIMARY AND GENERAL ELECTION CAMPAIGNS This section explains how much candidates for each office would receive for primary and general elections:

OFFICE PRIMARY GENERAL

Governor $1.00 per enrolled $7,500,000 voter in party.

Lt. Governor $.75 per enrolled $4,000,000 Attorney General voter in party. Comptroller

Senate $2.00 per enrolled $ 300,000 voter in party.

Assembly $2.00 per enrolled $ 100,000 voter in party. Every four years the amounts are adjusted using the consumer price index.

- This section also explains the triggering of additional funds when a participating clean elections candidate is outspent by a non-participating opponent or an independent expenditure:

o Additional funds from the fund shall be awarded to a qualified candidate when the total of campaign expenditures by nonparticipating candidates who oppose a qualified candidate and independent expenditures directed against the qualified candidate, or in support of the qualified candidate's opponent, exceeds one hundred percent of the public grant awarded to the candidate. The additional funds, dollar for dollar, would be given, but limited to four times the initial amount of public funds given to the CE candidate. The administrative agency would be responsible for coming up with the method of distributing these funds. These additional funds would need to be available to the clean elections candidate within 24 hours of the time when it was triggered.

- In order to do this, non-participating candidates and persons and entities making independent expenditures would need to comply with new reporting requirements.

- In addition, 21 days before the date of a covered elections, those same entities would need to report any new spending (either by the nonparticipating opponent or from independent expenditures that are against the CE candidate) within 24 hours of making the expenditure. This would also be true if the non-participating candidate or independent expenditure agent made a commitment to pay later. Reporting would be mandated even if a commitment to spend was made. So, for example, if a mail house is called to do a mailing for Monday, with the promise to pay on Wednesday, the expenditure would need to be reported within 24 hours of the Monday call.

SECTION 14-162 OPTIONAL PUBLIC FUNDING FOR PARTIES Provides an option for political parties to receive public funds if the party refuses to

accept private contributions of more than $5,000. Parties that abide by the $5,000 limit will receive a 2SCRIPT match for contributions up to $250. A party may receive up to a maximum of $2.5 million public dollars per year under this section.

SECTION 14-164 OFFICE HOLDER ACCOUNTS The office holder accounts give candidates a way to have some funding in the off season in a way that keeps them in the spirit of the Clean Election system instead of reverting back to receiving campaign contributions the traditional way to cover these campaign related expenses. Funds for the office holder accounts would come from unspent Clean Elections funds or new contributions of $5 to $125 from voters in the candidate's district. Funding in office holder accounts could only be spent during off-years. The limits for each on an annual basis would be as follows:

Governor: $ 100,000 Lieutenant Governor, Attorney-General, Comptroller: $ 50,000 State Senate: $ 25,000 State Assembly: $ 10,000

SECTION 14-166 POWER OF THE BOARD (ADMINISTRATIVE AGENCY) The State Campaign Finance Board regulates the public financing system pursuant to election law section 3-101. The board shall also create all the rules and regulations needed to administer the program.

SECTION 14-168 NEW YORK STATE CLEAN ELECTIONS CAMPAIGN FINANCE FUND This section establishes the "New York state clean elections fund." The fund houses the monies needed to fund only qualified clean elections candidates.

SECTION 14-170 DISBURSAL OF REVENUE FOR CLEAN ELECTIONS CAMPAIGN FINANCING - Upon certification the board transfers the public funding allotment to the clean elections candidate;

- Expenses of the campaign can only be pa.id using public funds, or the funding collected through the qualifying period;

- A petty cash fund can be set up to cover daily expenses like food, newspapers and other minor necessities, guidelines for petty cash will be established by the board;

- All cash expenditures over $25 need to have a recipe that includes item, cost and place of purchase.

SECTION 14-172 EXAMINATIONS AND REPAYMENTS This section explains the campaign finance board's power to examine all matters relating to participating and non-participating candidates,

their authorized committees and persons or entities making independent expenditures. It also states:

- If a participating candidate receives more money from the clean elections fund than it was suppose to receive, it must return the excess funding;

- If the participating candidate or committee makes an expenditure that doesn't fall into the guidelines of a qualified expenditure, it must return that amount to the fund;

- If there is excess funding after the election period, it must be either put into an office holder account, up to the limit allowed, or be returned to the fund by December 31 of the election year;

- If a candidate is disqualified because of fraud, the candidate or his or her principle committee is required to pay back all money that was spent out of the clean elections fund.

Section 14-174

ENFORCEMENT & PENALTIES If a candidate/committee, treasurer or agent, fails to file any required reports, statements, etc. in the time specified in the law or the rules formulated by the board, or fails to do anything else administratively required by the board, they will be subject to the penalties outlined in sections 14-132 and 14-136 of this chapter respectively.

SECTION 14-176 CAMPAIGNS FOR OFFICE NOT SUBJECT TO THIS ARTICLE Any elections that are not covered by the Clean Elections system are not subject to the requirements and limitations of this article.

SECTION 14-178 REPORTS Requires the board/administrative agency review and evaluate the clean elections program and submit a report to the governor and legislature by the first of September in the calendar year after the first election covered and any other time it is requested or the board thinks it necessary.

This section also amends the tax law to put a check off contribution box on state income tax forms of $100. If checked on the form, the money would be deposited into the Clean Elections Fund.

STATE CAMPAIGN FINANCE BOARD Section three of Part B establishes a new Election Law section 3-101. Said section creates the State Campaign Finance Board within the New York State Board of Elections, consisting of five members. It shall be the duty of said board to regulate and administer the public financing system. The board shall have the power to promulgate rules and regulations, as it sees fit to fulfill their duties.

Justification

"Clean Money, Clean Elections" stands for the simple notion that votes are more important than dollars. The current system in which political campaigns are privately financed diminishes the meaning of

the right to vote by allowing large contributions to have a damaging influence on the political process. AS the U.S. Supreme Court recognized in BUCKLEY V. VALEO, 424 US 1 (1976), states have a compelling interest in "reducing the deleterious effect of large contributions on our political process."

The current system of campaign finance also violates the rights of all citizens to equally and meaningfully participate in the democratic political process. It diminishes the free-speech rights of non-wealthy voters and candidates, whose voices are muffled by those who can afford to monopolize political communications. This undoubtedly broken system also fuels the public perception that special interests "pay to play." That perception undermines the electorate's confidence in the democratic process and gives rise to citizen apathy and cynicism.

The current system of campaign finance also makes it difficult for qualified candidates without access to large contributors or personal fortunes to mount competitive campaigns. It places challengers at a distinct disadvantage, inhibiting the free exchange of ideas and communication with the electorate.

Providing a voluntary "Clean Money, Clean Elections" campaign finance system in New York State will improve our democratic process by eliminating the deleterious influence of large contributions on the political process, removing access to wealth as a major determinant of a citizen's influence within the political process, and restoring the meaning of the principle of "one person, one vote."

By providing for a Clean Money Clean Elections system, this act also addresses the genuine concern about the amount of time and effort that a candidate must devote to raising campaign funds.

Finally, an independent enforcement system can give New yorkers meaningful assurance that candidates for public office are complying with the law, that public funds leveraged for campaigns are used lawfully, transparently and accountably, and that the abuses of public trust that make this act so vital to enact will be addressed swiftly and to the fullest extent of the law.

Legislative history

2009: Introduced to Elections 2008: S.7175A (Smith) Died in Elections. 2007: Sim. Bill (S.4434) Died in Elections. 2006: Sim. Bill (S.2401) Died in Elections.

Fiscal implications

There will be no cost in 2011. In 2012, there will be costs associated with participating candidates seeking election to the office of state comptroller. In 2014, all statewide candidates and state legislative and candidates will be eligible to participate. Other states that have public financing systems in place have had very low participation rates at first with increasing participation in later elections. The long term cost of the system in New York is unknown.

Effective date

This act shall take effect immediately; provided, however, that candidates for state comptroller will be eligible to participate in the voluntary clean elections financing system, as established pursuant to article fourteen-A of the election law, as added by this act, beginning with the 2013 primary election; and candidates for governor, lieutenant governor, attorney-general beginning in 2017 and legislature will be eligible to participate therein beginning with the 2015 primary election.