SENATE BILL 39

45th legislature - STATE OF NEW MEXICO - first session, 2001

INTRODUCED BY

Dede Feldman







AN ACT

RELATING TO ELECTIONS; PROVIDING FOR VOLUNTARY PUBLIC CAMPAIGN

FINANCING OF ELECTIONS FOR GOVERNOR, LIEUTENANT GOVERNOR, SECRETARY OF STATE, ATTORNEY GENERAL, STATE AUDITOR, STATE TREASURER, COMMISSIONER OF PUBLIC LANDS, STATE SENATORS, STATE REPRESENTATIVES AND COMMISSIONERS OF THE PUBLIC REGULATION COMMISSION; PRESCRIBING PENALTIES; MAKING AN APPROPRIATION; ENACTING CERTAIN SECTIONS OF THE NMSA 1978.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

Section 1. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] SHORT TITLE.--Sections 1 through 17 of this act may be cited as the "Public Campaign Finance Option Act"."

Section 2. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] DEFINITIONS.--As used in the Public Campaign Finance Option Act:

A. "applicant candidate" means a candidate who is running for office and who is seeking to be a certified candidate in a primary or general election;

B. "certified candidate" means a candidate running for a covered office who chooses to obtain financing pursuant to the Public Campaign Finance Option Act and is certified as a Public Campaign Finance Option Act candidate;

C. "contested election" means an election in which there are more candidates for a position than the number to be elected to that position;

D. "covered office" means the offices of governor, lieutenant governor, secretary of state, attorney general, state auditor, state treasurer, commissioner of public lands, public regulation commissioner, state senator or state representative;

E. "election cycle" means the primary and general elections for the same term of the same covered office, beginning on the day after the last general election for the office and ending with the general election; the primary election cycle begins on the first day of the election cycle and ends on the day of the primary election; the general election begins on the day after the primary election and ends on the day of the general election;

F. "fund" means the public election fund;

G. "noncertified candidate" means either a candidate running for a covered office who does not choose to participate in the Public Campaign Finance Option Act and who is not seeking to be a certified candidate or a candidate who declares his intent to participate but who fails to qualify;

H. "qualifying contribution" means a donation of five dollars ($5.00) in the form of cash or a check or money order payable to the fund in support of an applicant candidate that is:

(1) made by a registered voter who is eligible to vote for the covered office that the applicant candidate is seeking;

(2) made during the designated qualifying period and obtained through efforts made with the knowledge and approval of the applicant candidate; and

(3) acknowledged by a receipt that identifies the contributor's name and residential address on forms provided by the bureau of elections and that is signed by the contributor, one copy of which is attached to the list of contributors and sent to the bureau of elections;

I. "qualifying period" means:

(1) for applicant candidates for statewide covered offices, the period beginning October 1 immediately preceding the election year and ending at 5:00 p.m. on the second Tuesday of February of the election year;

(2) for applicant candidates for state senator, state representative and public regulation commissioner, the period beginning October 1 immediately preceding the election year and ending at 5:00 p.m. on the third Tuesday of March of the election year; and

(3) for independent candidates, the period beginning February 1 of the election year and ending that year at 5:00 p.m. on the filing date for independent candidates for the office for which the candidate is running;

J. "secretary" means the secretary of state or the office of the secretary of state; and

K. "seed money" means a contribution raised for the primary purpose of enabling applicant candidates to collect qualifying contributions."

Section 3. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] TERMS OF PARTICIPATION--DECLARATION OF INTENT.--

A. A candidate choosing to obtain financing pursuant to the Public Campaign Finance Option Act shall first file with the secretary a declaration of intent to participate in that act as an applicant candidate for a stated covered office. The declaration of intent shall be filed with the secretary prior to or during the qualifying period according to forms and procedures developed by the secretary.

B. An applicant candidate choosing to participate in the Public Campaign Finance Option Act shall submit a declaration of intent prior to collecting any qualifying contributions and make explicit in the declaration that the candidate has complied with and will continue to comply with that act's contribution and expenditure limits and all other requirements set forth in that act and rules issued by the secretary.

C. A candidate shall not be eligible to become an applicant candidate if the candidate has accepted contributions totaling five hundred dollars ($500) or more or made expenditures totaling five hundred dollars ($500) or more between the beginning of the qualifying period and filing a declaration of intent."

Section 4. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] QUALIFYING CONTRIBUTIONS.--Applicant candidates shall obtain qualifying contributions as follows:

A. the applicant candidate shall obtain qualifying contributions from that number of registered voters that is equal to at least one percent of the total number of registered voters in the district within which he is running or, for statewide offices, equal to one percent of the total number of registered voters in the state;

B. the calculation of one percent of registered voters shall be based on the number of registered voters as of the first day of the qualifying period. Applicant candidates may accept qualifying contributions from persons who become registered within the statutory time frame that would enable that person to vote in the primary election;

C. voters registered as independent are not excluded from making qualifying contributions but shall be registered within the statutory time frame as independent; and

D. no payment, gift or anything of value shall be given in exchange for a qualifying contribution."

Section 5. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] SEED MONEY.--

A. An applicant candidate may collect seed money from individual donors and political action committees in amounts of no more than one hundred dollars ($100) per donor or committee. An applicant candidate may contribute an amount of seed money from his own funds up to the limits specified in Subsection H of this section.

B. An applicant candidate may collect and spend seed money during the sixty days immediately preceding the qualifying period and throughout the qualifying period.

C. An applicant candidate may not collect seed money from a corporation, association or partnership formed under state law or from labor organizations.

D. An applicant candidate may not collect or spend seed money for any purpose after certification and before the end of the election cycle for which the candidate was certified, but after the election cycle may carry forward to the next election cycle any unspent seed money to be used as seed money.

E. If a certified candidate is defeated or is elected and decides not to run again as an applicant candidate, any unspent seed money shall be forfeited to the fund.

F. After becoming an applicant candidate and prior to certification, an applicant candidate shall not accept contributions, except for seed money or qualifying contributions.

G. An incumbent elected prior to 2002 who was not an applicant candidate when elected but declares his intent to become an applicant candidate in accordance with the Public Campaign Finance Option Act may transfer from his campaign fund for use as seed money up to the limits for contributions and expenditures specified in Subsection H of this section.

H. An applicant candidate shall limit seed money contributions and expenditures to the following amounts:

(1) twenty-five thousand dollars ($25,000) for a candidate for governor;

(2) ten thousand dollars ($10,000) for a candidate for lieutenant governor, secretary of state, state auditor, state treasurer or commissioner of public lands;

(3) fifteen thousand dollars ($15,000) for a candidate for attorney general;

(4) two thousand five hundred dollars ($2,500) for a candidate for public regulation commission;

(5) two thousand dollars ($2,000) for a candidate for state senator; and

(6) one thousand dollars ($1,000) for a candidate for state representative."

Section 6. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] CERTIFICATION.--

A. Upon receipt of a final submittal of qualifying contributions by an applicant candidate, the secretary shall determine whether the applicant candidate has:

(1) signed and filed a declaration of intent to obtain financing pursuant to the Public Campaign Finance Option Act in accordance with the requirements of that act;

(2) submitted the appropriate number of qualifying contributions;

(3) qualified as a candidate pursuant to other applicable state election law;

(4) complied with seed money contribution and expenditure restrictions; and

(5) otherwise met the requirements for obtaining financing pursuant to the Public Campaign Finance Option Act.

B. The secretary shall certify applicant candidates complying with the requirements of this section as certified candidates as soon as possible and no later than three days after final submittal of qualifying contributions and certification as a candidate pursuant to other applicable state election law.

C. A certified candidate shall comply with all requirements of the Public Campaign Finance Option Act after certification and throughout the primary election and general election cycles. A certified candidate who accepts public campaign finance funds for the primary election shall comply with all the requirements of the Public Campaign Finance Option Act for the remainder of the election cycle in question, even if he decides not to accept such funds for the general election."

Section 7. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] GUIDELINES AND RESTRICTIONS FOR CONTRIBUTIONS TO AND EXPENDITURES OF CERTIFIED CANDIDATES.--

A. All money distributed to certified candidates shall be used for campaign-related purposes.

B. A certified candidate shall return to the fund any amount that is unspent or unencumbered at the time that person ceases to be a candidate before a primary or general election for which the fund money was distributed.

C. A certified candidate shall limit total campaign expenditures and debts to the amount of money distributed to that candidate from the fund. A certified candidate shall not accept contributions or loans from any other source except his political party, as specified in Section 8 of the Public Campaign Finance Option Act.

D. A certified candidate shall return to the secretary, within two weeks after the primary election, any amount that is unspent or unencumbered by the date of the primary election for direct deposit into the fund.

E. A certified candidate shall return to the secretary, within two weeks after the general election, any amount that is unspent or unencumbered by the date of the general election for direct deposit into the fund."

Section 8. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] POLITICAL PARTY EXPENDITURES--CONTRIBUTIONS TO CERTIFIED CANDIDATES.--

A. A certified candidate may accept monetary or in-kind contributions from a political party; provided that the aggregate amount of such contributions from all political party committees combined does not exceed the equivalent of ten percent of the value of that candidate's aggregate public financing per election cycle.

B. All in-kind contributions from a political party distributed to certified candidates shall be used for campaign-related purposes.

C. In-kind contributions by a political party made during the general election campaign period on behalf of a group of the party's candidates shall not be considered an improper party contribution or count against the ten percent limit mentioned in Subsection A of this section if such group includes all of the candidates for a particular office who are candidates of that party.

D. Nothing in this section shall prevent political party funds from being used for: general operating expenses of the party; conventions; nominating and endorsing candidates; identifying, researching and developing the party's position on issues; party platform activities; noncandidate-specific voter registration; noncandidate-specific get-out-the-vote drives; travel expenses for noncandidate party leaders and staff; and other noncandidate-specific party building activities."

Section 9. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] CANDIDATE REPORTING REQUIREMENTS.--

A. The secretary shall publish guidelines outlining permissible campaign-related expenditures.

B. Applicant candidates shall file a report listing seed money contributions and expenditures with their application for certification.

C. Applicant candidates shall file qualifying contributions with the secretary during the qualifying period according to procedures developed by the secretary. In developing these procedures, the secretary shall use existing campaign reporting procedures and deadlines whenever practicable.

D. Certified candidates shall report expenditures according to the campaign reporting requirements specified in the Election Code.

E. In addition to the campaign contribution and expenditure reports specified in the Election Code, all noncertified candidates who have as an opponent a certified candidate shall report to the secretary ten days before the primary and general elections the amount of money spent by that noncertified candidate. This report shall include all previously unreported transactions through 5:00 p.m. two days before the report is due.

F. A person or political committee that makes expenditures to influence a race involving a certified candidate shall report to the secretary the amount that person or political committee has spent. These reports shall include all previously unreported transactions through 5:00 p.m. two days before the report is due, and shall be submitted as follows:

(1) for the primary election, by 5:00 p.m. on the second Monday in May, by 5:00 p.m. on the eleventh day before the election and by 5:00 p.m. on the Thursday before the election; and

(2) for the general election, by 5:00 p.m. the first Tuesday in October, by 5:00 p.m. on the eleventh day before the election and by 5:00 p.m. on the Thursday before the election."

Section 10. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] PUBLIC ELECTION FUND--CREATION--USE.--

A. There is created in the state treasury the "public election fund" solely for the purposes of:

(1) financing the election campaigns of certified candidates for covered offices;

(2) paying administrative and enforcement costs of the Public Campaign Finance Option Act; and

(3) carrying out all other specified provisions of the Public Campaign Finance Option Act.

B. The state treasurer shall invest the funds as other state funds are invested, and all income derived from the fund shall be credited directly to the fund. Remaining balances at the end of a fiscal year shall remain in the election fund and not revert to the general fund.

C. Money received from the following sources shall be deposited directly into the fund:

(1) qualifying contributions that have been submitted to the secretary;

(2) any recurring balance of unspent fund money distributed to a certified candidate who does not remain a candidate through the primary or general election period for which the money was distributed;

(3) money that remains unspent or unencumbered by a certified candidate following the date of the primary election;

(4) money that remains unspent or unencumbered by a certified candidate following the date of the general election;

(5) money from an optional tax checkoff that dedicates the following amounts of an individual's income tax payment to the fund pursuant to the Income Tax Act, effective beginning in taxable year 2001:

(a) five dollars ($5.00) for a single individual, married individuals filing separately and heads of household; or

(b) ten dollars ($10.00) for married individuals filing jointly;

(6) voluntary donations made directly to the fund, of which up to two hundred fifty dollars ($250) for an individual return or five hundred dollars ($500) for a joint return are tax deductible as specified in Section 20 of this act;

(7) unspent seed money that cannot be used for any other purpose; and

(8) money appropriated by the legislature from the general fund."

Section 11. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] DETERMINATION OF FUND AMOUNT.--

A. By January 1, 2002, and every two years thereafter, the secretary of state shall prepare and provide to the legislature a report documenting, evaluating and making recommendations relating to the administration, implementation and enforcement of the Public Campaign Finance Option Act.

B. In the report, the secretary shall set out the revenues received to date, the expected costs to the fund for the next election cycle and the amount of the annual appropriation from the legislature that will be required to meet this need."

Section 12. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] TIMING OF FUND DISTRIBUTION.--

A. Beginning with the election cycle ending with the general election in 2002, the secretary shall distribute money from the fund to certified candidates.

B. For a primary election certified candidate, the secretary shall distribute the amount due to that certified candidate for that covered office within one week of certification.

C. For a candidate certified for the general election, the secretary shall distribute the amount due to that certified candidate for that covered office within one week after the primary election."

Section 13. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] AMOUNT OF FUND DISTRIBUTION.--

A. By January 1, 2002, the secretary shall determine the amount of money to be distributed to each certified candidate for the election cycle ending with the general election in 2002, based on the type of election and the particular covered office for which the candidate is running.

B. For contested primary elections, the amount of money to be distributed is equal to eighty percent of the average amount of campaign expenditures made by all candidates receiving ten percent or greater of votes cast in all contested primary election races for the immediately preceding two primary elections for that covered office.

C. For uncontested primary elections, the amount of money to be distributed is equal to fifty percent of the average amount of campaign expenditures made by each candidate during all uncontested primary election races, or for contested races if the amount is lower, for the immediately preceding two primary elections for that covered office.

D. For contested general elections, the amount of money to be distributed is equal to eighty percent of the average amount of campaign expenditures made by all candidates receiving thirty percent or greater of votes cast in all uncontested general election races for the immediately preceding two general elections for that covered office.

E. For uncontested general elections, the amount of money to be distributed is equal to fifty percent of the average amount of campaign expenditures made by all candidates receiving thirty percent or greater of votes cast in all uncontested general election races for the immediately preceding two general elections for that covered office. If a general election race that is initially uncontested later becomes contested because of the qualification of an independent candidate to appear on the ballot for that race, an additional amount of money will be distributed to the certified candidate to make that candidate's total distribution amount equal to the amount distributed pursuant to Subsection D of this section.

F. Once the certification for candidates for the primary election has been completed, the secretary shall calculate the total amount of money to be distributed in the primary election cycle, based on the number of certified candidates and the allocations specified in this section. The secretary shall increase the total amount by twenty percent to provide funds for additional matching funds in the primary election as outlined in Section 14 of the Public Campaign Finance Option Act. The secretary shall also prepare an estimate of the total amount of money that might be distributed in the general election cycle. This estimate shall be increased by twenty percent to provide funds for additional matching funds in the general election as provided in Section 14 of the Public Campaign Finance Option Act. If the total amount to be distributed in the primary election cycle, plus the added twenty percent and the estimated total amount to be distributed in the general election cycle, plus the added twenty percent, all taken together, exceed the amount expected to be available in the fund, the secretary shall allocate the amount available between the primary and general election cycles. This allocation shall be based on the ratio of the two total amounts.

G. If the allocation specified in Subsection E of this section is needed, then the amounts to be distributed to individual candidates, specified in Subsections B through D of this section, shall each be reduced by the same percentage as the reduction in the total amount needed has been reduced relative to the total amount available.

H. If the immediately preceding two election cycles do not contain sufficient data for the secretary to determine the amount to be distributed for an office, the secretary shall use data from the most recent applicable elections for that office. If no applicable elections for that office contain sufficient data, the secretary shall set an amount based on data from elections for comparable offices.

I. At least every two years after January 1, 2002, the secretary shall evaluate and modify as necessary the dollar values originally determined by Subsections B through D and Subsection H of this section and shall consider and account for inflation in the evaluations."

Section 14. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] MATCHING FUNDS.--When a noncertified candidate has one or more opponents who are certified candidates and his campaign finance report or group of reports shows that the sum of the noncertified candidate's expenditures and obligations made, or funds raised or borrowed, whichever is greater, alone or in conjunction with expenditures made independently of the candidate to influence the election on behalf of the candidate, exceeds the amount distributed to the certified candidate, the secretary shall issue immediately to any opposing certified candidate an additional amount equivalent to the excess amount reported by the non-participating opposing candidate. Total matching funds to a certified candidate in an election are limited to twice the amount originally distributed to that candidate pursuant to Section 13 of the Public Campaign Finance Option Act."

Section 15. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] ADMINISTRATION--SECRETARY OF STATE--DUTIES.--

A. The secretary shall adopt rules to ensure effective administration of the Public Campaign Finance Option Act.

B. The rules shall include procedures for:

(1) qualifications, certification and disbursement of revenues and return of unspent fund revenues;

(2) obtaining qualifying contributions;

(3) certification of candidates;

(4) collection of revenues; and

(5) return of fund disbursements and other money to fund."

Section 16. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] APPEALS.--The procedure for challenging a certification decision by the secretary is as follows:

A. a person aggrieved by a certification decision or a decision regarding the distribution of matching funds may appeal to the secretary within three days of the decision. The appeal shall be in writing and shall set forth the reasons for appeal;

B. within five days after an appeal is properly made, and after due notice is given to the parties in dispute, the secretary shall hold a hearing whereby:

(1) the appellant has the burden of providing evidence to demonstrate that the secretary's decision was improper; and

(2) the secretary shall rule on the appeal within three days after the completion of the hearing;

C. the parties in dispute may appeal the decision of the secretary by commending an action in district court; and

D. certified candidates whose certification is revoked on appeal shall return to the secretary any unspent money distributed from the fund. If the secretary or court finds that an appeal was made frivolously or to result in delay or hardship, the secretary or court may sanction the moving party by requiring the party to pay costs of the administrative hearing, the court hearing and the opposing parties."

Section 17. A new section of the Election Code is enacted to read:

"[NEW MATERIAL] PENALTIES.--

A. In addition to other penalties that may be applicable, a person who violates a provision of the Public Campaign Finance Option Act is subject to a civil penalty of up to ten thousand dollars ($10,000) per violation. In addition to a fine, a certified candidate found in violation of that act may be required to return to the fund all amounts distributed to the candidate from the fund. If the secretary makes a determination that a violation of that act has occurred, the secretary shall impose a fine or transmit the finding to the attorney general for prosecution. In determining whether a certified candidate is in violation of the expenditure limits of that act, the secretary may consider as a mitigating factor any circumstances out of the candidate's control.

B. A person who willfully or knowingly violates the provisions of the Public Campaign Finance Option Act or rules of the secretary or knowingly makes a false statement in a report required by that act is guilty of a fourth degree felony and, if he is a certified candidate, shall return to the fund all money distributed to that candidate."

Section 18. A new section of the Tax Administration Act is enacted to read:

"[NEW MATERIAL] DISTRIBUTION--PUBLIC ELECTION FUND.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the public election fund of all amounts designated as contributions to that fund according to the provisions of the Income Tax Act."

Section 19. A new Section of the Income Tax Act is enacted to read:

"[NEW MATERIAL] OPTIONAL DESIGNATION OF TAX PAYMENT--PUBLIC ELECTION FUND.--

A. Single individuals, married individuals filing separately and heads of household may designate that five dollars ($5.00) of their income tax payment due be paid into the public election fund. In the case of married individuals filing jointly, the couple may designate that either five dollars ($5.00) or ten dollars ($10.00) of the couple's income tax due be paid into the public election fund.

B. The secretary shall revise the state income tax form to allow the designation by individual taxpayers of contributions to the public election fund in substantially the following form:

"YES NO

New Mexico Public Election Fund Contribution--

Check YES if you want five dollars of your tax

payment to go to the Public Election Fund. If filing jointly, check YES if your spouse

also wants five dollars to go the Public

Election Fund.

Checking YES will not change your tax bill nor will it decrease the amount of your tax refund."."

Section 20. A new section of the Income Tax Act is enacted to read:

"[NEW MATERIAL] DEDUCTION--PAYMENTS INTO THE PUBLIC ELECTION FUND.--A taxpayer may claim a deduction from net income for the amount of contributions made to the public election fund of up to two hundred fifty dollars ($250) for individuals or five hundred dollars ($500) for married individuals filing jointly for the taxable year in which the deduction was made. A husband and wife who file separate returns may each claim only one-half of the deduction that would have been allowed on a joint return. Individuals having income both within and without this state shall apportion this deduction in accordance with rules of the secretary."

Section 21. APPROPRIATION.--One hundred fifty thousand dollars ($150,000) is appropriated from the general fund to the public election fund for the purpose of carrying out the administrative duties of the secretary of state on election practices pursuant to the provisions of the Public Campaign Finance Option Act in fiscal year 2002 and subsequent fiscal years. One million nine hundred thousand dollars ($1,900,000) is appropriated from the general fund to the public election fund for disbursement by the secretary to certified candidates. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund.

Section 22. SEVERABILITY.--If any part of or application of the Public Campaign Finance Option Act is held invalid, the remainder of its provisions or its application to other situations or persons shall not be affected.

Section 23. APPLICABILITY.--The provisions of Sections 18 through 20 of this act apply to taxable years beginning on or after January 1, 2001.

Section 24. EFFECTIVE DATE.--The effective date of the provisions of this act is July 1, 2001.

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