2017 -- H 5189

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LC000133

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2017

____________

A N   A C T

RELATING TO ELECTIONS - CAMPAIGN CONTRIBUTIONS AND EXPENDITURES

REPORTING

     Introduced By: Representatives Phillips, Shanley, Hull, Morin, and Marshall

     Date Introduced: January 25, 2017

     Referred To: House Judiciary

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 17-25-3 of the General Laws in Chapter 17-25 entitled "Rhode

Island Campaign Contributions and Expenditures Reporting" is hereby amended to read as

follows:

     17-25-3. Definitions.

     As used in this chapter, unless a different meaning clearly appears from the context:

      (1) "Business entity" means any corporation, whether for profit or not for profit,

domestic corporation or foreign corporation, as defined in § 7-1.2-106, financial institution,

cooperative, association, receivership, trust, holding company, firm, joint stock company, public

utility, sole proprietorship, partnership, limited partnership, or any other entity recognized by the

laws of the United States and/or the state of Rhode Island for the purpose of doing business. The

term "business entity" shall not include a political action committee organized pursuant to this

chapter or a political party committee or an authorized campaign committee of a candidate or

office holder. The term "business entity" shall not include any exempt nonprofit as defined herein

or any organization described in § 501(c)(3) of the Internal Revenue Code of 1986, or any

subsequent corresponding internal revenue code of the United States, as amended from time to

time, for the purposes of chapter 17-25.3 of the general laws only.

      (2) "Candidate" means any individual who undertakes any action, whether preliminary or

final, which is necessary under the law to qualify for nomination for election or election to public

office, and/or any individual who receives a contribution or makes an expenditure, or gives his or

her consent for any other person to receive a contribution or make an expenditure, with a view to

bringing about his or her nomination or election to any public office, whether or not the specific

public office for which he or she will seek nomination or election is known at the time the

contribution is received or the expenditure is made and whether or not he or she has announced

his or her candidacy or filed a declaration of candidacy at that time.

      (3) "Contributions" and "expenditures" include all transfers of money, credit or debit

card transactions on-line or electronic payment systems such as "pay pal," paid personal services,

or other thing of value to or by any candidate, committee of a political party, or political action

committee or ballot question advocate. A loan shall be considered a contribution of money until it

is repaid. Credit card transactions may be conducted by a personal credit card issued to a

candidate and/or elected official provided that the credit card's use shall be restricted to lawful

expenditures relating to the candidate's campaign or election to public office, or travel and/or

accommodations while on business for said office.

      (4) "Election" means any primary, general, or special election or town meeting for any

public office of the state, municipality, or district or for the determination of any question

submitted to the voters of the state, municipality, or district.

      (5) "Election cycle" means the twenty-four (24) month period commencing on January 1

of odd number years and ending on December 31 of even number years; provided, with respect to

the public financing of election campaigns of general officers under §§ 17-25-19, 17-25-20, and

17-25-25, "election cycle" means the forty-eight (48) month period commencing on January 1 of

odd numbered years and ending December 31 of even numbered years.

      (6) "In-Kind Contributions" means the monetary value of other things of value or paid

personal services donated to, or benefiting, any person required to file reports with the board of

elections.

      (7) "Other thing of value" means any item of tangible real or personal property of a fair

market value in excess of one hundred dollars ($100).

      (8) "Paid personal services" means personal services of every kind and nature, the cost or

consideration for which is paid or provided by someone other than the committee or candidate for

whom the services are rendered, but shall not include personal services provided without

compensation by persons volunteering their time.

      (9) "Person" means an individual, partnership, committee, association, corporation,

union, charity and/or any other organization. The term "person" shall not include any exempt

nonprofit as defined herein or any organization described in § 501(c)(3) of the Internal Revenue

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Code of 1986, or any subsequent corresponding internal revenue code of the United States, as

amended from time to time, for the purposes of chapter 17-25.3 of the general laws only.

      (10) "Political action committee" means any group of two (2) or more persons that

accepts any contributions to be used for advocating the election or defeat of any candidate or

candidates. Only political action committees that have accepted contributions from fifteen (15) or

more persons in amounts of ten dollars ($10.00) or more within an election cycle shall be

permitted to make contributions, and those committees must make contributions to at least five

(5) candidates for state or local office within an election cycle.

      (11) "Public office" means any state, municipal, school, or district office or other

position that is filled by popular election, except political party offices. "Political party offices"

means any state, city, town, ward, or representative or senatorial district committee office of a

political party or delegate to a political party convention, or any similar office.

      (12) "State" means state of Rhode Island.

      (13) "Testimonial affair" means an affair of any kind or nature including, but not limited

to, cocktail parties, breakfasts, luncheons, dinners, dances, picnics, or similar affairs expressly

and directly intended to raise campaign funds in behalf of a candidate to be used for nomination

or election to a public office in this state, or expressly and directly intended to raise funds in

behalf of any state or municipal committee of a political party, or expressly and directly intended

to raise funds in behalf of any political action committee.

      (14) "Electioneering communication" means any print, broadcast, cable, satellite, or

electronic media communication not coordinated, as set forth in § 17-25-23, with any candidate,

authorized candidate campaign committee, or political party committee and which

unambiguously identifies a candidate or referendum and is made either within sixty (60) days

before a general or special election or town meeting for the office sought by the candidate or

referendum; or thirty (30) days before a primary election, for the office sought by the candidate;

and is targeted to the relevant electorate.

      (i) A communication which refers to a clearly identified candidate or referendum is

"targeted to the relevant electorate" if the communication can be received by two thousand

(2,000) or more persons in the district the candidate seeks to represent or the constituency voting

on the referendum.

      (ii) Exceptions: The term "electioneering communication" does not include:

      (A) A communication appearing in a news story, commentary, or editorial distributed

through the facilities of any broadcasting station, unless such facilities are owned or controlled by

any political party, political committee, or candidate;

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      (B) A communication which constitutes a candidate debate or forum conducted pursuant

to regulations adopted by the board of elections or which solely promotes such a debate or forum

and is made by or on behalf of the person sponsoring the debate or forum; or

      (C) A communication made by any business entity to its members, owners, stockholders,

or employees;

      (D) A communication over the Internet, except for (I) Communications placed for a fee

on the website of another person, business entity, or political action committee; and (II) Websites

formed primarily for the purpose, or whose primary purpose is, to expressly advocate the election

or defeat of a clearly identified candidate or the passage or defeat of a referendum; or

      (E) Any other communication exempted under such regulations as the board of elections

may promulgate (consistent with the requirements of this paragraph) to ensure the appropriate

implementation of this paragraph.

      (15) "Independent expenditure" means an expenditure which, when taken as a whole,

expressly advocates the election or defeat of a clearly identified candidate, or the passage or

defeat of a referendum, or amounts to the functional equivalent of such express advocacy, and is

in no way coordinated, as set forth in § 17-25-23, with any candidate's campaign, authorized

candidate committee, or political party committee. An expenditure amounts to the functional

equivalent of express advocacy if it can only be interpreted by a reasonable person as advocating

the election, passage, or defeat of a candidate or referendum, taking into account whether the

communication mentions a candidate or referendum and takes a position on a candidate's

character, qualifications, or fitness for office. An independent expenditure is not a contribution to

that candidate or committee.

      (i) Exceptions: The term "independent expenditure" does not include:

      (A) A communication appearing in a news story, commentary, or editorial distributed

through the facilities of any broadcasting station, unless such facilities are owned or controlled by

any political party, political committee, or candidate;

      (B) A communication which constitutes a candidate debate or forum conducted pursuant

to regulations adopted by the board of elections or which solely promotes such a debate or forum

and is made by or on behalf of the person sponsoring the debate or forum;

      (C) A communication made by any business entity to its members, owners, stockholders,

or employees;

      (D) A communication over the Internet, except for (I) Communications placed for a fee

on the website of another person, business entity, or political action committee; and (II) Websites

formed primarily for the purpose, or whose primary purpose is, to expressly advocate the election

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or defeat of a clearly identified candidate or the passage or defeat of a referendum; or

      (E) Any other communication exempted under such regulations as the board of elections

may promulgate (consistent with the requirements of this paragraph) to ensure the appropriate

implementation of this paragraph.

      (16) "Covered transfer" means any transfer or payment of funds by any person, business

entity or political action committee to another person, business entity, or political action

committee if the person, business entity, or political action committee making the transfer: (i)

Designates, requests, or suggests that the amounts be used for independent expenditures or

electioneering communications or making a transfer to another person for the purpose of making

or paying for such independent expenditures or electioneering communications; (ii) Made such

transfer or payment in response to a solicitation or other request for a transfer or payment for the

making of or paying for independent expenditures or electioneering communications or making a

transfer to another person for the purpose of marking or paying for such independent expenditures

or electioneering communications; (iii) Engaged in discussions with the recipient of the transfer

or payment regarding independent expenditures or electioneering communications or making a

transfer to another person for the purpose of marking or paying for such independent expenditures

or electioneering communications; or (iv) Made independent expenditures or electioneering

communications in an aggregate amount of five thousand dollars ($5,000) or more during the two

(2) year period ending on the date of the transfer or payment, or knew or had reason to know that

the person receiving the transfer or payment made such independent expenditures or

electioneering communications in such an aggregate amount during that two (2) year period.

      (A) Exceptions: The term "covered transfer" does not include:

      (I) A transfer or payment made by a person, business entity or political action committee

in the ordinary course of any trade or business conducted by the person, business entity or

political action committee or in the form of investments made by the person, business entity or

political action committee; or

      (II) A transfer or payment made by a person, business entity or political action

committee if the person, business entity or political action committee making the transfer

prohibited, in writing, the use of such transfer or payment for independent expenditures,

electioneering communications, or covered transfers and the recipient of the transfer or payment

agreed to follow the prohibition and deposited the transfer or payment in an account which is

segregated from any account used to make independent expenditures, electioneering

communications, or covered transfers.

      (17) For the purposes of chapter 17-25.3 of the general laws, "donation" means all

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transfers of money, credit or debit card transactions on-line or electronic payment systems such as

"pay pal," paid personal services, or other thing of value to or by any person, business entity, or

political action committee. A loan shall be considered a donation of money until it is repaid.

      (18) For the purposes of chapter 17-25.3 of the general laws, "donor" means a person,

business entity, or political action committee that makes a donation.

      (19) "Exempt nonprofit" means any organization described in § 501(c)(4) of the Internal

Revenue Code that spends an aggregate annual amount of no more than ten percent (10%) of its

annual expenses or no more than fifteen thousand dollars ($15,000), whichever is less, on

independent expenditures, electioneering communications, and covered transfers as defined

herein and certifies the same to the board of elections seven (7) days before and after a primary

election and seven (7) days before and after a general or special election.

      (20) For purposes of chapter 17-25.3 of the general laws, "referendum" means the same

as the definition set forth in § 17-5-1 of the general laws.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO ELECTIONS - CAMPAIGN CONTRIBUTIONS AND EXPENDITURES

REPORTING

***

     This act would permit candidates and/or elected officials to possess and use a personal

credit card for use only for lawful expenditures relating to the candidate's campaign or election,

or for travel and/or accommodations while on business for the elected official's public office.

     This act would take effect upon passage.

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