81R2358 CAE-D
By: Shapleigh S.B. No. 613
A BILL TO BE ENTITLED
AN ACT
relating to political contributions and expenditures; providing
civil and criminal penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 251.001, Election Code, is amended by
amending Subdivisions (2) and (8) and adding Subdivisions (21)
through (33) to read as follows:
(2) "Contribution" means a direct or indirect transfer
of money, goods, services, or any other thing of value and includes
an agreement made or other obligation incurred, whether legally
enforceable or not, to make a transfer. The term:
(A) includes:
(i) a loan or extension of credit, other
than those expressly excluded by this subdivision;
(ii) [, and] a guarantee of a loan or
extension of credit, including a loan described by Subparagraph
(i);
(iii) a coordinated expenditure; or
(iv) the provision of in-kind professional
political services, including legal advice, polling, media
consulting, direct mailing, and fund-raising to a candidate,
officeholder, political party, or political committee; and
(B) [this subdivision. The term] does not
include:
(i) [(A)] a loan made in the due course of
business by a corporation that is legally engaged in the business of
lending money and that has conducted the business continuously for
more than one year before the loan is made; or
(ii) [(B)] an expenditure required to be
reported under Section 305.006(b), Government Code.
(8) "Direct campaign expenditure" means an [a
campaign] expenditure by a person for a communication that is
express advocacy or an electioneering communication and that is not
a coordinated expenditure with a candidate, officeholder,
political committee, or agent of a candidate, officeholder, or
political committee [that does not constitute a campaign
contribution by the person making the expenditure].
(21) "Membership organization" means a trade
association, cooperative, or corporation without capital stock
that:
(A) is composed of members, some or all of whom
are vested with the authority to operate or administer the
organization according to the organization's articles, bylaws,
constitution, or other formal organizational documents;
(B) expressly states the qualifications and
requirements for membership in its articles, bylaws, constitution,
or other formal organizational documents;
(C) makes its articles, bylaws, constitution, or
other formal organizational documents available to its members upon
request;
(D) solicits persons to become members;
(E) expressly acknowledges the acceptance of
membership by sending a membership card, including the member's
name on a membership newsletter list, or using another means; and
(F) is not organized primarily for the purpose of
influencing the nomination for election, or election, of an
individual to public office.
(22) "Member" means a person who:
(A) satisfies the requirements for membership in
a membership organization;
(B) affirmatively accepts the membership
organization's invitation to become a member;
(C) has a significant financial attachment to,
including a significant investment or ownership interest in, the
membership organization or pays membership dues, other than
payments to a separate segregated fund, at least annually to the
organization;
(D) has a significant organizational attachment
to the membership organization that includes affirmation of
membership on at least an annual basis; and
(E) has an opportunity to participate in any part
of the organization's decision-making.
(23) "Connected organization" means a corporation,
labor organization, or membership organization other than a
political committee, that directly or indirectly establishes or
administers a separate segregated fund.
(24) "Establishment or administration expense" means
an expenditure incurred in the normal course of business by an
organization, regardless of whether the organization engages in
political activity. An expenditure is an establishment or
administration expense if the expenditure:
(A) is for:
(i) office space;
(ii) phones;
(iii) salaries for routine clerical and
administrative assistance;
(iv) utilities;
(v) general office supplies;
(vi) legal and accounting fees for the
organization's compliance with this title;
(vii) office equipment; or
(viii) routine administrative expenses
incurred in setting up and administering a separate segregated
fund; and
(B) is not for political activity, including:
(i) political consulting;
(ii) telephone banks;
(iii) issue advocacy;
(iv) electioneering brochures and direct
mail;
(v) voter registration and
get-out-the-vote drives;
(vi) broadcast issue advertising or
electioneering communications;
(vii) other political advertising;
(viii) political fund-raising;
(ix) voter identification, lists, or
databases; and
(x) any other expenditure directly or
indirectly connected with an election or campaign for public
office.
(25) "Restricted class" means the group of individuals
who:
(A) for a corporation, are the stockholders,
employees, and families of the stockholders and employees of the
corporation or the corporation's subsidiaries, branches,
divisions, affiliates, or departments;
(B) for a labor organization, are the members,
employees, and families of the members and employees of the labor
organization; or
(C) for a membership organization:
(i) are the members, employees, and
families of employees of the organization; or
(ii) with respect to a solicitation for a
campaign contribution, are the stockholders, employees, and
families of stockholders and employees of a corporate member of a
membership organization that separately and specifically approves
the solicitation and does not approve a solicitation by any other
membership organization for the same calendar year.
(26) "Executive or administrative personnel" means
individuals employed by a corporation, labor organization, or
membership organization who are paid on a salary or commission
basis and who have policymaking, managerial, professional, or
supervisory responsibilities. The term includes officers,
executives, managers of a plant, division, or section of the
corporation or organization, lawyers, and engineers. The term does
not include professionals who are represented by a labor
organization, salaried foremen or supervisors having direct
supervision over hourly employees, former or retired personnel who
are not stockholders, or individuals who are not employees for the
purpose of income withholding tax on employee wages under the
Internal Revenue Code.
(27) "Separate segregated fund" means a fund
established under Section 253.1001.
(28) "Coordinated expenditure" means an expenditure
described by Section 251.010.
(29) "Electioneering communication" means a
communication that:
(A) is disseminated by a broadcast, cable, or
satellite communication, a mass mailing, or a telephone bank;
(B) refers to a clearly identified candidate;
(C) is publicly distributed:
(i) on or after the 60th day before a
general, special, or runoff election for the identified candidate;
or
(ii) on or after the 30th day before a
primary election;
(D) is targeted to the identified candidate's
relevant electorate; and
(E) is not:
(i) a public communication that refers to a
clearly identified candidate appearing in a news story, commentary,
editorial, or work intended for entertainment distributed through
the facilities of a bona fide broadcasting station, newspaper,
magazine, or other publication, unless such facilities are owned or
controlled by a political party, political committee, or candidate;
or
(ii) a communication to the restricted
class of the person making the communication.
(30) A communication is "targeted to the relevant
electorate" if it can be received by at least the lesser of 50,000
people or two percent of those eligible to vote for the candidate,
as specified by the secretary of state. Notwithstanding this
subdivision, a communication is not "targeted to the relevant
electorate" if it can only be received by fewer than 500 people.
(31) "Mass mailing" means the mailing or facsimile
transmission of more than 500 identical or substantially similar
documents within a 30-day period.
(32) A communication is made by a "telephone bank" if
more than 500 telephone calls with an identical or substantially
similar message are made within a 30-day period.
(33) "Express advocacy" means a communication that
refers to a clearly identified candidate and that expressly
advocates for or against the candidate, regardless of the words
contained in the communication. The term "express advocacy" does
not include:
(A) a communication that refers to a clearly
identified candidate appearing in a news story, commentary,
editorial, or work intended for entertainment distributed through
the facilities of a bona fide broadcasting station, newspaper,
magazine, or other publication, unless such facilities are owned or
controlled by a political party, political committee, or candidate;
or
(B) a communication to the restricted class of
the person making the communication.
SECTION 2. Subchapter A, Chapter 251, Election Code, is
amended by adding Section 251.010 to read as follows:
Sec. 251.010. COORDINATED EXPENDITURES. An expenditure is
coordinated with a candidate, officeholder, political party, or
political committee if the expenditure is made:
(1) in cooperation, consultation, or concert with, at
the request or suggestion of, or under an understanding with the
candidate, officeholder, political party, or political committee
or an agent acting on behalf of the candidate, officeholder, party,
or committee;
(2) wholly or partly for the production,
dissemination, distribution, or publication of political
advertising or a campaign communication prepared by the candidate,
officeholder, or political committee or an agent acting on behalf
of the candidate, officeholder, or committee;
(3) by a person based on information that the
candidate, officeholder, or political committee or an agent acting
on behalf of the candidate, officeholder, or committee provides to
the person about a candidate's, officeholder's, or committee's
plans, projects, or needs to the person making the expenditure with
the intent that the expenditure be made;
(4) by a person who, in the same semiannual reporting
period as that in which the expenditure is made, is serving or has
served in an executive or policymaking position as a member,
employee, fund-raiser, or agent of the candidate, officeholder, or
political committee or an agent acting on behalf of the candidate,
officeholder, or committee;
(5) by a person who retains the professional advisory
or consulting services of another person who has provided or is
providing campaign-related services in the same semiannual
reporting period as that in which the expenditure is made to the
candidate or officeholder, including services relating to the
candidate's or officeholder's decision to seek the office;
(6) for fund-raising activities with or for the
candidate, officeholder, or political committee or an agent acting
on behalf of the candidate, officeholder, or committee, or for the
solicitation or receipt of political contributions on behalf of the
candidate, officeholder, or political committee or an agent acting
on behalf of the candidate, officeholder, or committee; or
(7) for a communication that clearly identifies a
candidate if the person making the expenditure informs the
candidate, officeholder, or political committee or an agent acting
on behalf of the candidate, officeholder, or committee about the
communication's contents, intended audience, timing, location,
mode, or frequency of dissemination, and the candidate,
officeholder, committee, or agent approves the communication.
SECTION 3. Section 253.002(a), Election Code, is amended to
read as follows:
(a) A person may not knowingly make, [or] authorize, or aid
the making of a direct campaign expenditure.
SECTION 4. Section 253.061, Election Code, is amended to
read as follows:
Sec. 253.061. DIRECT EXPENDITURE OF $1,000 [$100] OR LESS.
Except as otherwise provided by law, an individual not acting in
concert with another person may make one or more direct campaign
expenditures in an election from the individual's own property if:
(1) the total expenditures on any one or more
candidates or measures do not exceed $1,000 [$100]; and
(2) the individual receives no reimbursement for the
expenditures.
SECTION 5. The heading to Section 253.062, Election Code,
is amended to read as follows:
Sec. 253.062. DIRECT EXPENDITURE EXCEEDING $1,000 [$100].
SECTION 6. Section 253.062(a), Election Code, is amended to
read as follows:
(a) Except as otherwise provided by law, an individual not
acting in concert with another person may make one or more direct
campaign expenditures in an election from the individual's own
property that exceed $1,000 [$100] on any one or more candidates or
measures if:
(1) the individual complies with Chapter 254 as if the
individual were a campaign treasurer of a political committee; and
(2) the individual receives no reimbursement for the
expenditures.
SECTION 7. The heading to Subchapter D, Chapter 253,
Election Code, is amended to read as follows:
SUBCHAPTER D. CORPORATIONS, [AND] LABOR ORGANIZATIONS, AND
MEMBERSHIP ORGANIZATIONS
SECTION 8. Section 253.091, Election Code, is amended to
read as follows:
Sec. 253.091. CORPORATIONS COVERED. This subchapter
applies only to:
(1) corporations that are organized under the Texas
Business Corporation Act, the Texas For-Profit Corporation Law, the
Texas Non-Profit Corporation Act, the Texas Nonprofit Corporation
Law, federal law, or law of another state or nation; and
(2) an entity with a parent, subsidiary, division, or
affiliate described by Subdivision (1).
SECTION 9. Section 253.095, Election Code, is amended to
read as follows:
Sec. 253.095. PUNISHMENT OF AGENT. An officer, director,
representative, or other agent of or a person who aids a corporation
or labor organization that [who] commits an offense under this
subchapter is punishable for the grade of offense applicable to the
corporation or labor organization.
SECTION 10. The heading to Section 253.098, Election Code,
is amended to read as follows:
Sec. 253.098. COMMUNICATION WITH RESTRICTED CLASS
[STOCKHOLDERS OR MEMBERS].
SECTION 11. Section 253.098(a), Election Code, is amended
to read as follows:
(a) A corporation, [or] labor organization, or membership
organization may make one or more direct campaign expenditures from
its own property for the purpose of communicating directly with its
restricted class [stockholders or members, as applicable, or with
the families of its stockholders or members].
SECTION 12. Section 253.099(a), Election Code, is amended
to read as follows:
(a) A corporation, [or] labor organization, or membership
organization may make one or more expenditures from its own
property to finance nonpartisan voter registration and
get-out-the-vote campaigns aimed at its restricted class
[stockholders or members, as applicable, or at the families of its
stockholders or members].
SECTION 13. Subchapter D, Chapter 253, Election Code, is
amended by adding Sections 253.1001 and 253.1002 to read as
follows:
Sec. 253.1001. EXPENDITURES FOR SEPARATE SEGREGATED FUND.
(a) A corporation, labor organization, or membership organization,
other than a political committee, may make political expenditures
from its own treasury funds and property to finance the
establishment or administration expenses of not more than one
separate segregated fund.
(b) For purposes of this section, all parents,
subsidiaries, branches, divisions, and affiliates of a corporation
or membership organization count as a single entity.
(c) A corporation or labor organization may make a political
expenditure from its own treasury funds or property for
establishment or administration expenses of one membership
organization of which it is a member.
(d) Money in a separate segregated fund from corporate,
labor organization, or membership organization treasury funds
shall be kept in a separate account and may not be commingled with
any other funds. A person who knowingly violates this subsection
commits an offense. An offense under this subsection is a Class A
misdemeanor.
(e) A separate segregated fund shall be treated as a
general-purpose committee and shall comply with the provisions of
this title applicable to a general-purpose committee as if the
separate segregated fund were a general-purpose committee.
Sec. 253.1002. SOLICITATION FOR SEPARATE SEGREGATED FUNDS.
(a) Subject to Subsection (c), a connected organization may make a
political expenditure from its own treasury funds for expenses to
solicit or facilitate political contributions from its restricted
class for the organization's separate segregated fund.
(b) A connected organization may facilitate a political
contribution from its restricted class under Subsection (a) by
enabling a contribution to be made by a payroll deduction, checking
a form to indicate a contribution is authorized, instituting a
periodic payment plan, or enclosing a return envelope in a
solicitation request. A connected organization may solicit a
voluntary political contribution from its restricted class under
Subsection (a) by mailings, oral requests, pamphlets, and other
means.
(c) A corporation or labor organization may not make more
than two written solicitations for contributions to the separate
segregated fund in a calendar year to employees who are not
stockholders, executive or administrative personnel, or the
families of stockholders or executive or administrative personnel.
SECTION 14. The heading to Section 253.101, Election Code,
is amended to read as follows:
Sec. 253.101. UNLAWFUL CONTRIBUTION OR EXPENDITURE [BY
COMMITTEE].
SECTION 15. Section 253.101, Election Code, is amended by
amending Subsection (a) and adding Subsections (a-1) and (a-2) to
read as follows:
(a) A person, including a connected [political committee
assisted by a corporation or labor] organization, [under Section
253.100] may not make a political contribution or political
expenditure in whole or part from money that is known by the person
or a member or officer of the person [political committee] to be
dues, fees, or other money required as a condition of employment or
promotion or condition of membership in a labor organization.
(a-1) A person, including a connected organization, may not
use the establishment, administration, and solicitation process as
a means of exchanging treasury money for voluntary contributions.
(a-2) A person, including a connected organization, may
not, through a bonus, expense account, or another form of direct or
indirect compensation or reimbursement, pay another person for
making a political contribution.
SECTION 16. Sections 253.102(a) and (b), Election Code, are
amended to read as follows:
(a) A stockholder's, employee's or labor organization
member's contribution must be voluntary. A corporation, [or] labor
organization, membership organization, or other person [or a
political committee assisted by a corporation or labor organization
under Section 253.100] commits an offense if the person [it] uses or
threatens to use physical force, job discrimination, or financial
reprisal or gain against an employee or labor organization member
to obtain money or any other thing of value to benefit a candidate,
officeholder, political committee, or separate segregated fund or
to be used to influence the result of an election or to assist an
officeholder.
(b) A political committee assisted by a corporation or labor
organization [under Section 253.100] commits an offense if it
accepts or uses money or any other thing of value that is known by a
member or officer of the political committee to have been obtained
in violation of Subsection (a).
SECTION 17. Section 253.104(b), Election Code, is amended
to read as follows:
(b) A corporation or labor organization may not knowingly
make a contribution authorized by Subsection (a) during a period
beginning on the 60th day before the date of a general election for
state and county officers or a primary election and continuing
through the day of the election.
SECTION 18. Section 254.031(a), Election Code, is amended
to read as follows:
(a) Except as otherwise provided by this chapter, each
report filed under this chapter must include:
(1) the amount of political contributions from each
person that in the aggregate equal or exceed $100 [$50] and that are
accepted during the reporting period by the person or committee
required to file a report under this chapter, the full name and
address of the person making the contributions, and the dates of the
contributions;
(2) the amount of loans that are made during the
reporting period for campaign or officeholder purposes to the
person or committee required to file the report and that in the
aggregate equal or exceed $100 [$50], the dates the loans are made,
the interest rate, the maturity date, the type of collateral for the
loans, if any, the full name and address of the person or financial
institution making the loans, the full name and address, principal
occupation, and name of the employer of each guarantor of the loans,
the amount of the loans guaranteed by each guarantor, and the
aggregate principal amount of all outstanding loans as of the last
day of the reporting period;
(3) the amount of political expenditures that in the
aggregate equal or exceed $100 [$50] and that are made during the
reporting period, the full name and address of the persons to whom
the expenditures are made, and the dates and purposes of the
expenditures;
(4) the amount of each payment made during the
reporting period from a political contribution if the payment is
not a political expenditure, the full name and address of the person
to whom the payment is made, and the date and purpose of the
payment;
(5) the total amount or a specific listing of the
political contributions of [$50 or] less than $100 accepted and the
total amount or a specific listing of the political expenditures of
[$50 or] less than $100 made during the reporting period;
(6) the total amount of all political contributions
accepted and the total amount of all political expenditures made
during the reporting period;
(7) the name of each candidate or officeholder who
benefits from a direct campaign expenditure made during the
reporting period by the person or committee required to file the
report, and the office sought or held, excluding a direct campaign
expenditure that is made by the principal political committee of a
political party on behalf of a slate of two or more nominees of that
party; and
(8) as of the last day of a reporting period for which
the person is required to file a report, the total amount of
political contributions accepted, including interest or other
income on those contributions, maintained in one or more accounts
in which political contributions are deposited as of the last day of
the reporting period.
SECTION 19. Section 254.151, Election Code, is amended to
read as follows:
Sec. 254.151. ADDITIONAL CONTENTS OF REPORTS. In addition
to the contents required by Section 254.031, each report by a
campaign treasurer of a general-purpose committee must include:
(1) the committee's full name and address;
(2) the full name, residence or business street
address, and telephone number of the committee's campaign
treasurer;
(3) the identity and date of the election for which the
report is filed, if applicable;
(4) the name of each identified candidate or measure
or classification by party of candidates supported or opposed by
the committee, indicating whether the committee supports or opposes
each listed candidate, measure, or classification by party of
candidates;
(5) the name of each identified officeholder or
classification by party of officeholders assisted by the committee;
(6) the principal occupation of each person from whom
political contributions that in the aggregate equal or exceed $100
[$50] are accepted during the reporting period;
(7) the amount of each political expenditure in the
form of a political contribution made to a candidate, officeholder,
or another political committee that is returned to the committee
during the reporting period, the name of the person to whom the
expenditure was originally made, and the date it is returned;
(8) on a separate page or pages of the report, the
identification of any contribution from a corporation or labor
organization made and accepted under Subchapter D, Chapter 253; and
(9) on a separate page or pages of the report, the
identification of the name of the donor, the amount, and the date of
any expenditure made by a corporation or labor organization to:
(A) establish or administer the political
committee; or
(B) finance the solicitation of political
contributions to the committee [under Section 253.100].
SECTION 20. Subchapter F, Chapter 254, Election Code, is
amended by adding Section 254.1511 to read as follows:
Sec. 254.1511. REPORTING OF EXPENDITURES BY SEPARATE
SEGREGATED FUND. A separate segregated fund shall report
expenditures made under Sections 253.098, 253.099, 253.1001, and
253.1002 on a separate schedule.
SECTION 21. Section 254.156, Election Code, is amended to
read as follows:
Sec. 254.156. CONTENTS OF MONTHLY REPORTS. Each monthly
report filed under this subchapter must comply with Sections
254.031 and 254.151 except that the maximum amount of a political
contribution, expenditure, or loan that is not required to be
individually reported is[:
[(1) $10 in the aggregate; or
[(2)] $20 in the aggregate [for a contribution
accepted by a general-purpose committee to which Section 254.1541
applies].
SECTION 22. Section 257.001, Election Code, is amended to
read as follows:
Sec. 257.001. PRINCIPAL POLITICAL COMMITTEE OF POLITICAL
PARTY. The state or county executive committee of a political party
may designate not more than one [a] general-purpose committee as
the principal political committee for that party in the state or
county, as applicable.
SECTION 23. Section 257.002, Election Code, is amended to
read as follows:
Sec. 257.002. REQUIREMENTS RELATING TO CORPORATE OR LABOR
UNION CONTRIBUTIONS. (a) A political party that accepts a
contribution authorized by Section 253.104 may use the contribution
only [to]:
(1) for its own establishment or administrative
expenses [defray normal overhead and administrative or operating
costs incurred by the party]; [or]
(2) to administer a primary election;
(3) for the establishment or administrative expenses
of a [or] convention held by the party; or
(4) for expenses related to redistricting.
(b) A political party that accepts contributions authorized
by Section 253.104 shall maintain the contributions in a separate
account and shall pay all allowable expenditures under Subsection
(a) owed to a third-party vendor or contractor directly from the
separate account. A political party may not transfer a contribution
authorized by Section 253.104 to a political committee or another
entity directly or indirectly under the party's direction or
control.
SECTION 24. Section 257.003, Election Code, is amended by
adding Subsection (e) to read as follows:
(e) Sections 254.153 and 254.154 govern the reporting
schedule for a report required by this section.
SECTION 25. Section 257.004, Election Code, is amended by
amending Subsection (a) and adding Subsection (c) to read as
follows:
(a) Beginning on the 60th day before the date of the general
election for state and county officers and continuing through the
day of the election, a political party may not knowingly accept a
contribution authorized by Section 253.104 or make an expenditure
from the account required by Section 257.002. Beginning on the 60th
day before the date of a primary election, a political party may not
knowingly accept a contribution authorized by Section 253.104.
(c) A contribution is accepted under this section when it is
received by or on behalf of the party, unless the contribution is
returned to the contributor not later than the fifth day after the
date the contribution is received. An expenditure is made from the
account established under Section 257.002 when any funds are
expended or obligated, whichever is earlier.
SECTION 26. Section 257.007, Election Code, is amended to
read as follows:
Sec. 257.007. RULES. The commission shall adopt rules to
implement this chapter and ensure that corporate or labor
organization funds are not used for political activity in
circumvention of this chapter.
SECTION 27. Sections 253.098(b), 253.099(b), 253.100, and
257.003(d), Election Code, are repealed.
SECTION 28. The changes in law made by this Act apply only
to a contribution or expenditure made on or after September 1, 2009.
A contribution or expenditure made before September 1, 2009, is
governed by the law in effect immediately before that date, and the
former law is continued in effect for that purpose.
SECTION 29. The amendment by this Act of Subdivision (2),
Section 251.001, Election Code, by the addition of Paragraph
(A)(iv) to that subdivision is intended to clarify rather than
change existing law.
SECTION 30. This Act takes effect September 1, 2009.