SB0069

SENATE BILL 69

52nd legislature - STATE OF NEW MEXICO - second session, 2016

INTRODUCED BY

Michael Padilla

AN ACT

RELATING TO CAMPAIGN FINANCE; CREATING THE CAMPAIGN FINANCE BUREAU AND CAMPAIGN FINANCE BANK; ALLOWING CANDIDATES, POLITICAL COMMITTEES AND OTHER PERSONS WITH CAMPAIGN ACCOUNTS TO DEPOSIT ALL POLITICAL CONTRIBUTIONS IN THE CAMPAIGN FINANCE BANK; ESTABLISHING THE CAMPAIGN FINANCE BANK BOARD; AUTHORIZING THE CAMPAIGN FINANCE BANK TO IMPOSE FEES AND PROVIDE SERVICES; ALLOWING APPROVAL OF ALL EXPENDITURES FROM A CAMPAIGN FINANCE BANK ACCOUNT; MAKING AN APPROPRIATION.

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

SECTION 1. A new section of the Campaign Reporting Act is enacted to read:

"[NEW MATERIAL] CAMPAIGN FINANCE BANK CREATED--PURPOSE AND LIMITATIONS--GOVERNANCE.--

A. For the purpose of tracking political contributions and expenditures of candidates, political committees and other persons with campaign accounts, the "campaign finance bank" is created in the campaign finance bureau of the office of the secretary of state.

B. The campaign finance bank shall be governed by the campaign finance bank board, which shall operate, manage and control the bank, including creation and enforcement of rules for the transaction of the bank's business.

C. The bank is not created or organized, and its operations shall not be conducted, for the purpose of making a profit. No part of the revenues or assets of the bank shall benefit, or be distributable to, its board members or other private persons. All revenue generated by the bank shall be used to pay for operations and expenses of the bank and the campaign finance bank board.

D. The bank shall not be subject to the supervision or control of any other board, bureau, department or agency of the state except as specifically provided in this 2016 act. No use of the terms "state agency" or "instrumentality" in any other law of the state shall be deemed to refer to the bank unless the bank is specifically referred to in the law. The bank is a governmental instrumentality for purposes of the Tort Claims Act.

E. The financial transactions of the bank are limited to those expressly provided for in this 2016 act.

F. The bank's principal place of business shall be in Santa Fe, New Mexico."

SECTION 2. A new section of the Campaign Reporting Act is enacted to read:

"[NEW MATERIAL] CAMPAIGN FINANCE BANK BOARD CREATED--MEMBERSHIP--TERMS--CHAIR AND VICE CHAIR--OFFICERS.--

A. The "campaign finance bank board" is created and is administratively attached to the campaign finance bureau of the office of the secretary of state.

B. The board shall be composed of four members. The governor, chief justice of the supreme court, president pro tempore of the senate and speaker of the house of representatives shall each appoint one member of the board, who shall be a resident of the state with expertise in banking, lending and finances and who shall not hold other public office. No more than two of the board members shall be from the same political party. The board members shall select one member to serve as chair of the board for a four-year term. The members of the board shall receive no compensation for their services, but they shall be reimbursed for actual and necessary expenses at the same rate and on the same basis as provided for public officers in the Per Diem and Mileage Act.

C. Board members shall be appointed for four-year terms. To provide for staggered terms, the members of the board initially appointed, other than the chair, shall serve staggered terms from the date of their appointment as determined by lot as follows:

(1) one member for a four-year term;

(2) one member for a three-year term; and

(3) two members for two-year terms.

D. Vacancies shall be filled by the appointing entity for the remainder of the unexpired term. Board members shall be eligible for reappointment.

E. The board shall annually elect one of its members as vice chair.

F. The board shall appoint and prescribe the duties of a president of the bank and other officers as the board deems necessary. The president and other officers of the bank shall not hold other public office. The members of the board shall not be officers or employees of the bank. The board may employ accountants, financial experts, bankers and such other advisors, consultants and agents as may be necessary in its judgment. The board shall fix the compensation of officers and employees. Officers and employees of the bank are not subject to the Personnel Act."

SECTION 3. A new section of the Campaign Reporting Act is enacted to read:

"[NEW MATERIAL] POWERS OF THE CAMPAIGN FINANCE BANK BOARD.--The campaign finance bank board shall have all the powers necessary or convenient to carry out and effectuate the banking duties of the campaign finance bureau of the office of secretary of state, including the power to:

A. sue and be sued;

B. have a seal and alter it at pleasure;

C. make and alter bylaws for its organization and internal management;

D. fix, revise from time to time, charge and collect fees and other charges in connection with the making of services rendered by the bank;

E. make and execute agreements, contracts and other instruments necessary or convenient in the exercise of the powers and functions of the board;

F. make, alter or repeal rules addressing its operations, properties and facilities;

G. do any and all things necessary to carry out its purposes and exercise the power granted in this 2016 act; provided that the bank shall only accept deposits for candidates, political committees and other persons that have established or maintain campaign accounts pursuant to the Campaign Reporting Act; and

H. review and address complaints and inquiries concerning the operations and services of the bank."

SECTION 4. A new section of the Campaign Reporting Act is enacted to read:

"[NEW MATERIAL] CAMPAIGN FINANCE BANK OPERATIONS.--

A. The campaign finance bank shall provide banking services to all candidates, political committees and other persons who establish or maintain campaign fund accounts in the bank pursuant to the provisions of the Campaign Reporting Act.

B. The bank shall accept contributions on behalf of each candidate, political committee or other person who has an account with the bank and credit each contribution to the appropriate account. The bank shall notify the account holder of each contribution received by the bank that is credited to the account holder's bank account.

C. The campaign finance bureau of the office of secretary of state shall evaluate whether each expenditure by a candidate, political committee or other person who has an account with the bank is a legal expenditure of campaign funds in accordance with the provisions of the Campaign Reporting Act and direct the bank not to approve any withdrawal of funds from an account for an expenditure that is not allowed by Section 1-19-29.1 NMSA 1978.

D. The bank shall make available for inspection by the public the current financial status of each campaign finance bank account established pursuant to the Campaign Reporting Act.

E. The bank shall make quarterly reports to the campaign finance bank board of all banking activities, including all deposits and withdrawals from each account maintained by the bank."

SECTION 5. A new section of Chapter 8, Article 4 NMSA 1978 is enacted to read:

"[NEW MATERIAL] CAMPAIGN FINANCE BUREAU CREATED.--The "campaign finance bureau" is created in the office of the secretary of state. The bureau, in conjunction with the campaign finance bank board, shall oversee operations of the campaign finance bank. The bureau shall also administer the provisions of the Campaign Reporting Act and the Voter Action Act."

SECTION 6. Section 1-19-26 NMSA 1978 (being Laws 1979, Chapter 360, Section 2, as amended by Laws 2009, Chapter 67, Section 1 and by Laws 2009, Chapter 68, Section 2) is amended to read:

"1-19-26. DEFINITIONS.--As used in the Campaign Reporting Act:

A. "advertising campaign" means an advertisement or series of advertisements used for a political purpose and disseminated to the public either in print, by radio or television broadcast or by any other electronic means, including telephonic communications, and may include direct or bulk mailings of printed materials;

B. "anonymous contribution" means a contribution the contributor of which is unknown to the candidate or the candidate's agent or the political committee or its agent who accepts the contribution;

C. "bank account" means an account in a financial institution located in New Mexico or the campaign finance bank;

D. "campaign committee" means two or more persons authorized by a candidate to raise, collect or expend contributions on the candidate's behalf for the purpose of electing the candidate to office;

E. "candidate" means an individual who seeks or considers an office in an election covered by the Campaign Reporting Act, including a public official, who either has filed a declaration of candidacy or nominating petition or:

(1) for a nonstatewide office, has received contributions or made expenditures of one thousand dollars ($1,000) or more or authorized another person or campaign committee to receive contributions or make expenditures of one thousand dollars ($1,000) or more for the purpose of seeking election to the office; or

(2) for a statewide office, has received contributions or made expenditures of two thousand five hundred dollars ($2,500) or more or authorized another person or campaign committee to receive contributions or make expenditures of two thousand five hundred dollars ($2,500) or more for the purpose of seeking election to the office or for candidacy exploration purposes in the years prior to the year of the election;

F. "contribution" means a gift, subscription, loan, advance or deposit of money or other thing of value, including the estimated value of an in-kind contribution, that is made or received for a political purpose, including payment of a debt incurred in an election campaign, but "contribution" does not include the value of services provided without compensation or unreimbursed travel or other personal expenses of individuals who volunteer a portion or all of their time on behalf of a candidate or political committee, nor does it include the administrative or solicitation expenses of a political committee that are paid by an organization that sponsors the committee;

G. "deliver" or "delivery" means to deliver by certified or registered mail, telecopier, electronic transmission or facsimile or by personal service;

H. "election" means any primary, general or statewide special election in New Mexico and includes county and judicial retention elections but excludes municipal, school board and special district elections;

I. "election year" means an even-numbered year in which an election covered by the Campaign Reporting Act is held;

J. "expenditure" means a payment, transfer or distribution or obligation or promise to pay, transfer or distribute any money or other thing of value for a political purpose, including payment of a debt incurred in an election campaign or pre-primary convention, but does not include the administrative or solicitation expenses of a political committee that are paid by an organization that sponsors the committee;

K. "person" means an individual or entity;

L. "political committee" means two or more persons, other than members of a candidate's immediate family or campaign committee or a husband and wife who make a contribution out of a joint account, who are selected, appointed, chosen, associated, organized or operated primarily for a political purpose; and "political committee" includes:

(1) political parties, political action committees or similar organizations composed of employees or members of any corporation, labor organization, trade or professional association or any other similar group that raises, collects, expends or contributes money or any other thing of value for a political purpose;

(2) a single individual whose actions represent that the individual is a political committee; and

(3) a person or an organization of two or more persons that within one calendar year expends funds in excess of five hundred dollars ($500) to conduct an advertising campaign for a political purpose;

M. "political purpose" means influencing or attempting to influence an election or pre-primary convention, including a constitutional amendment or other question submitted to the voters;

N. "prescribed form" means a form or electronic format prepared and prescribed by the secretary of state;

O. "proper filing officer" means either the secretary of state or the county clerk as provided in Section 1-19-27 NMSA 1978;

P. "public official" means a person elected to an office in an election covered by the Campaign Reporting Act or a person appointed to an office that is subject to an election covered by that act; and

Q. "reporting individual" means every public official, candidate or treasurer of a campaign committee and every treasurer of a political committee."

SECTION 7. Section 1-19-26.1 NMSA 1978 (being Laws 1993, Chapter 46, Section 2, as amended) is amended to read:

"1-19-26.1. POLITICAL COMMITTEES--REGISTRATION--DISCLOSURES.--

A. It is unlawful for [any] a political committee that receives, contributes or expends in excess of five hundred dollars ($500) in any calendar year to continue to receive or make [any] a contribution or expenditure for a political purpose unless that political committee appoints and maintains a treasurer and registers with the secretary of state.

B. A political committee shall register with the secretary of state within ten days of receiving, contributing or expending in excess of five hundred dollars ($500) by paying a filing fee of fifty dollars ($50.00) and filing a statement of organization under oath on a prescribed form showing:

(1) the full name of the political committee, which shall fairly and accurately reflect the identity of the committee, including any sponsoring organization, and its address;

(2) a statement of the purpose for which the political committee was organized;

(3) the name, address and relationship of any connected or associated organization or entity;

(4) the names and addresses of the officers of the committee; and

(5) an identification of either the bank or the account number of the campaign finance bank account used by the committee for all expenditures or contributions made or received.

C. The provisions of this section do not apply to a political committee that is located in another state and is registered with the federal election commission if the political committee reports on federal reporting forms filed with the federal election commission all expenditures for and contributions made to reporting individuals in New Mexico and files with the secretary of state, according to the schedule required for the filing of forms with the federal election commission, a copy of either the full report or the cover sheet and the portions of the federal reporting forms that contain the information on expenditures for and contributions made to reporting individuals in New Mexico."

SECTION 8. Section 1-19-34 NMSA 1978 (being Laws 1979, Chapter 360, Section 10, as amended) is amended to read:

"1-19-34. CANDIDATES--POLITICAL COMMITTEES--TREASURER--BANK ACCOUNT--ANONYMOUS CONTRIBUTIONS--CONTRIBUTIONS FROM SPECIAL EVENTS.--

A. It is unlawful for the members of any political committee or any candidate to make any expenditure or solicit or accept any contribution for a political purpose unless:

(1) a treasurer has been appointed and is constantly maintained; provided, however, when a duly appointed treasurer is unable for any reason to continue as treasurer, the candidate or political committee shall appoint a successor; and provided further that a candidate may serve as the candidate's own treasurer;

(2) all disbursements of money and receipts of contributions are authorized by and through the candidate or treasurer;

(3) a separate bank account has been established and all receipts of money contributions and all expenditures of money are deposited in and disbursed from the one bank account maintained by the treasurer in the name of the candidate or political committee; provided that nothing in this section shall prohibit investments from the bank account to earn interest as long as the investments and earnings are fully reported. All disbursements except for disbursements made from a petty cash fund of one hundred dollars ($100) or less shall be made in a form such that the date, amount and payee of the transaction are automatically recorded or by check made payable to the person or entity receiving the disbursement and not to "cash" or "bearer"; and

(4) the treasurer upon disbursing or receiving money or other things of value immediately enters and thereafter keeps a proper record preserved by the treasurer, including a full, true and itemized statement and account of each sum disbursed or received, the date of such disbursal or receipt, to whom disbursed or from whom received and the object or purpose for which it was disbursed or received.

B. Each person that has established an account with the campaign finance bank shall inform potential contributors to make all contributions directly to the campaign finance bank for credit to the person's bank account.

[B.] C. No anonymous contributions may be accepted in excess of one hundred dollars ($100). The aggregate amount of anonymous contributions received by a reporting individual during a primary or general election or a statewide special election shall not exceed two thousand dollars ($2,000) for statewide races and five hundred dollars ($500) for all other races.

[C.] D. Cash contributions received at special events that are unidentifiable as to specific contributor but identifiable as to the special event are not subject to the anonymous contribution limits provided for in this section so long as no single special event raises, after expenses, more than one thousand dollars ($1,000) in such cash contributions. For those contributions, due diligence and best efforts shall be made to disclose on a special prescribed form the sponsor, date, place, total amount received, expenses incurred, estimated number of persons in attendance and other identifiable factors that describe the special event. For purposes of this subsection, "special event" includes an event such as a barbecue or similar fundraiser where tickets costing fifteen dollars ($15.00) or less are sold or an event such as a coffee, tea or similar reception.

[D.] E. Any contributions received pursuant to this section in excess of the limits established in [Subsections B and] Subsection C or D of this section shall be donated to the state general fund or an organization to which a federal income tax deduction would be available under Subparagraph (A) of Paragraph (1) of Subsection (b) of Section 170 of the Internal Revenue Code of 1986, as amended."

SECTION 9. APPROPRIATION.--Five hundred thousand dollars ($500,000) is appropriated from the general fund to the office of secretary of state for expenditure in fiscal year 2017 to carry out the purposes of this act. Any unexpended or unencumbered balance remaining at the end of fiscal year 2017 shall revert to the general fund.

SECTION 10. EFFECTIVE DATE.--The effective date of the provisions of this act is November 9, 2016.

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