S.B. 140

1

PERSONAL USE OF CAMPAIGN FUNDS
2 2005 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: Karen Hale
5
6 LONG TITLE
7 General Description:
8 This bill modifies the Election Code by enacting provisions governing the personal use
9 and disposition of campaign funds.
10 Highlighted Provisions:
11 This bill:
12 . establishes requirements for the disposition or transfer of monies remaining in
13 campaign accounts;
14 . prohibits owners of campaign accounts from expending campaign monies for
15 personal use; and
16 . provides a civil penalty for a violation of the requirements.
17 Monies Appropriated in this Bill:
18 None
19 Other Special Clauses:
20 None
21 Utah Code Sections Affected:
22 AMENDS:
23 20A-11-101, as last amended by Chapter 90, Laws of Utah 2004
24 20A-11-201, as last amended by Chapter 355, Laws of Utah 1997
25 20A-11-301, as last amended by Chapter 355, Laws of Utah 1997
26 20A-11-402, as last amended by Chapter 355, Laws of Utah 1997
27 20A-11-1301, as enacted by Chapter 355, Laws of Utah 1997

28
29 Be it enacted by the Legislature of the state of Utah:
30 Section 1. Section 20A-11-101 is amended to read:
31 20A-11-101. Definitions.
32 As used in this chapter:
33 (1) "Address" means the number and street where an individual resides or where a
34 reporting entity has its principal office.
35 (2) "Ballot proposition" includes initiatives, referenda, proposed constitutional
36 amendments, and any other ballot propositions submitted to the voters that are authorized by
37 the Utah Code Annotated 1953.
38 (3) "Candidate" means any person who:
39 (a) files a declaration of candidacy for a public office; or
40 (b) receives contributions, makes expenditures, or gives consent for any other person to
41 receive contributions or make expenditures to bring about the person's nomination or election
42 to a public office.
43 (4) "Chief election officer" means:
44 (a) the lieutenant governor for state office candidates, legislative office candidates,
45 officeholders, political parties, political action committees, corporations, political issues
46 committees, and state school board candidates; and
47 (b) the county clerk for local school board candidates.
48 (5) "Continuing political party" means an organization of voters that participated in the
49 last regular general election and polled a total vote equal to 2% or more of the total votes cast
50 for all candidates for the United States House of Representatives.
51 (6) (a) "Contribution" means any of the following when done for political purposes:
52 (i) a gift, subscription, donation, loan, advance, or deposit of money or anything of
53 value given to the filing entity;
54 (ii) an express, legally enforceable contract, promise, or agreement to make a gift,
55 subscription, donation, unpaid or partially unpaid loan, advance, or deposit of money or
56 anything of value to the filing entity;
57 (iii) any transfer of funds from another reporting entity or a corporation to the filing
58 entity;

59 (iv) compensation paid by any person or reporting entity other than the filing entity for
60 personal services provided without charge to the filing entity;
61 (v) remuneration from any organization or its directly affiliated organization that has a
62 registered lobbyist to compensate a legislator for a loss of salary or income while the
63 Legislature is in session;
64 (vi) salaries or other remuneration paid to a legislator by any agency or subdivision of
65 the state, including school districts, for the period the Legislature is in session; and
66 (vii) goods or services provided to or for the benefit of the filing entity at less than fair
67 market value.
68 (b) "Contribution" does not include:
69 (i) services provided without compensation by individuals volunteering a portion or all
70 of their time on behalf of the filing entity; or
71 (ii) money lent to the filing entity by a financial institution in the ordinary course of
72 business.
73 (7) (a) "Corporation" means a domestic or foreign, profit or nonprofit, business
74 organization that is registered as a corporation or is authorized to do business in a state and
75 makes any expenditure from corporate funds for:
76 (i) political purposes; or
77 (ii) the purpose of influencing the approval or the defeat of any ballot proposition.
78 (b) "Corporation" does not mean:
79 (i) a business organization's political action committee or political issues committee; or
80 (ii) a business entity organized as a partnership or a sole proprietorship.
81 (8) "Detailed listing" means:
82 (a) for each contribution or public service assistance:
83 (i) the name and address of the individual or source making the contribution or public
84 service assistance;
85 (ii) the amount or value of the contribution or public service assistance; and
86 (iii) the date the contribution or public service assistance was made; and
87 (b) for each expenditure:
88 (i) the amount of the expenditure;
89 (ii) the person or entity to whom it was disbursed;

90 (iii) the specific purpose, item, or service acquired by the expenditure; and
91 (iv) the date the expenditure was made.
92 (9) "Election" means each:
93 (a) regular general election;
94 (b) regular primary election; and
95 (c) special election at which candidates are eliminated and selected.
96 (10) (a) "Expenditure" means:
97 (i) any disbursement from contributions, receipts, or from the separate bank account
98 required by this chapter;
99 (ii) a purchase, payment, donation, distribution, loan, advance, deposit, gift of money,
100 or anything of value made for political purposes;
101 (iii) an express, legally enforceable contract, promise, or agreement to make any
102 purchase, payment, donation, distribution, loan, advance, deposit, gift of money, or anything of
103 value for political purposes;
104 (iv) compensation paid by a corporation or filing entity for personal services rendered
105 by a person without charge to a reporting entity;
106 (v) a transfer of funds between the filing entity and a candidate's personal campaign
107 committee; or
108 (vi) goods or services provided by the filing entity to or for the benefit of another
109 reporting entity for political purposes at less than fair market value.
110 (b) "Expenditure" does not include:
111 (i) services provided without compensation by individuals volunteering a portion or all
112 of their time on behalf of a reporting entity;
113 (ii) money lent to a reporting entity by a financial institution in the ordinary course of
114 business; or
115 (iii) anything listed in Subsection (10)(a) that is given by a corporation or reporting
116 entity to candidates for office or officeholders in states other than Utah.
117 (11) "Filing entity" means the reporting entity that is filing a report required by this
118 chapter.
119 (12) "Financial statement" includes any summary report, interim report, or other
120 statement disclosing contributions, expenditures, receipts, donations, or disbursements that is

121 required by this chapter.
122 (13) "Governing board" means the individual or group of individuals that determine the
123 candidates and committees that will receive expenditures from a political action committee.
124 (14) "Incorporation" means the process established by Title 10, Chapter 2, Part 1,
125 Incorporation, by which a geographical area becomes legally recognized as a city or town.
126 (15) "Incorporation election" means the election authorized by Section 10-2-111 .
127 (16) "Incorporation petition" means a petition authorized by Section 10-2-109 .
128 (17) "Individual" means a natural person.
129 (18) "Interim report" means a report identifying the contributions received and
130 expenditures made since the last report.
131 (19) "Legislative office" means the office of state senator, state representative, speaker
132 of the House of Representatives, president of the Senate, and the leader, whip, and assistant
133 whip of any party caucus in either house of the Legislature.
134 (20) "Legislative office candidate" means a person who:
135 (a) files a declaration of candidacy for the office of state senator or state representative;
136 (b) declares himself to be a candidate for, or actively campaigns for, the position of
137 speaker of the House of Representatives, president of the Senate, or the leader, whip, and
138 assistant whip of any party caucus in either house of the Legislature; and
139 (c) receives contributions, makes expenditures, or gives consent for any other person to
140 receive contributions or make expenditures to bring about the person's nomination or election
141 to a legislative office.
142 (21) "Newly registered political party" means an organization of voters that has
143 complied with the petition and organizing procedures of this chapter to become a registered
144 political party.
145 (22) "Officeholder" means a person who holds a public office.
146 (23) "Party committee" means any committee organized by or authorized by the
147 governing board of a registered political party.
148 (24) "Person" means both natural and legal persons, including individuals, business
149 organizations, personal campaign committees, party committees, political action committees,
150 political issues committees, labor unions, and labor organizations.
151 (25) "Personal campaign committee" means the committee appointed by a candidate to

152 act for the candidate as provided in this chapter.
153 (26) (a) "Personal use" means an expenditure that provides a benefit of any kind to a
154 candidate, legislative office candidate, or officeholder that is not reasonably related to political
155 purposes or to fulfilling the duties of the office to which the candidate, legislative office
156 candidate, or officeholder was elected.
157 (b) "Personal use" does not mean an expenditure for political purposes.
158 [(26)] (27) (a) "Political action committee" means an entity, or any group of
159 individuals or entities within or outside this state, that solicits or receives contributions from
160 any other person, group, or entity or makes expenditures for political purposes. A group or
161 entity may not divide or separate into units, sections, or smaller groups for the purpose of
162 avoiding the financial reporting requirements of this chapter, and substance shall prevail over
163 form in determining the scope or size of a political action committee.
164 (b) "Political action committee" includes groups affiliated with a registered political
165 party but not authorized or organized by the governing board of the registered political party
166 that receive contributions or makes expenditures for political purposes.
167 (c) "Political action committee" does not mean:
168 (i) a party committee;
169 (ii) any entity that provides goods or services to a candidate or committee in the regular
170 course of its business at the same price that would be provided to the general public;
171 (iii) an individual;
172 (iv) individuals who are related and who make contributions from a joint checking
173 account;
174 (v) a corporation; or
175 (vi) a personal campaign committee.
176 [(27)] (28) "Political convention" means a county or state political convention held by
177 a registered political party to select candidates.
178 [(28)] (29) (a) "Political issues committee" means an entity, or any group of individuals
179 or entities within or outside this state, that solicits or receives donations from any other person,
180 group, or entity or makes disbursements to influence, or to intend to influence, directly or
181 indirectly, any person to:
182 (i) assist in placing a statewide ballot proposition on the ballot, assist in keeping a

183 statewide ballot proposition off the ballot, or refrain from voting or vote for or vote against any
184 statewide ballot proposition; or
185 (ii) sign or refuse to sign an incorporation petition or refrain from voting, vote for, or
186 vote against any proposed incorporation in an incorporation election.
187 (b) "Political issues committee" does not mean:
188 (i) a registered political party or a party committee;
189 (ii) any entity that provides goods or services to an individual or committee in the
190 regular course of its business at the same price that would be provided to the general public;
191 (iii) an individual;
192 (iv) individuals who are related and who make contributions from a joint checking
193 account; or
194 (v) a corporation, except a corporation whose apparent purpose is to act as a political
195 issues committee.
196 [(29)] (30) (a) "Political issues contribution" means any of the following:
197 (i) a gift, subscription, unpaid or partially unpaid loan, advance, or deposit of money or
198 anything of value given to a political issues committee;
199 (ii) an express, legally enforceable contract, promise, or agreement to make a political
200 issues donation to influence the approval or defeat of any ballot proposition;
201 (iii) any transfer of funds received by a political issues committee from a reporting
202 entity;
203 (iv) compensation paid by another reporting entity for personal services rendered
204 without charge to a political issues committee; and
205 (v) goods or services provided to or for the benefit of a political issues committee at
206 less than fair market value.
207 (b) "Political issues contribution" does not include:
208 (i) services provided without compensation by individuals volunteering a portion or all
209 of their time on behalf of a political issues committee; or
210 (ii) money lent to a political issues committee by a financial institution in the ordinary
211 course of business.
212 [(30)] (31) (a) "Political issues expenditure" means any of the following:
213 (i) any payment from political issues contributions made for the purpose of influencing

214 the approval or the defeat of a statewide ballot proposition;
215 (ii) a purchase, payment, distribution, loan, advance, deposit, or gift of money made for
216 the purpose of influencing the approval or the defeat of a statewide ballot proposition;
217 (iii) an express, legally enforceable contract, promise, or agreement to make any
218 political issues expenditure;
219 (iv) compensation paid by a reporting entity for personal services rendered by a person
220 without charge to a political issues committee; or
221 (v) goods or services provided to or for the benefit of another reporting entity at less
222 than fair market value.
223 (b) "Political issues expenditure" does not include:
224 (i) services provided without compensation by individuals volunteering a portion or all
225 of their time on behalf of a political issues committee; or
226 (ii) money lent to a political issues committee by a financial institution in the ordinary
227 course of business.
228 [(31)] (32) "Political purposes" means an act done with the intent or in a way to
229 influence or tend to influence, directly or indirectly, any person to refrain from voting or to vote
230 for or against any candidate for public office at any caucus, political convention, primary, or
231 election.
232 [(32)] (33) "Primary election" means any regular primary election held under the
233 election laws.
234 [(33)] (34) "Public office" means the office of governor, lieutenant governor, state
235 auditor, state treasurer, attorney general, state or local school board member, state senator, state
236 representative, speaker of the House of Representatives, president of the Senate, and the leader,
237 whip, and assistant whip of any party caucus in either house of the Legislature.
238 [(34)] (35) (a) "Public service assistance" means the following when given or provided
239 to an officeholder to defray the costs of functioning in a public office or aid the officeholder to
240 communicate with the officeholder's constituents:
241 (i) a gift, subscription, donation, unpaid or partially unpaid loan, advance, or deposit of
242 money or anything of value to an officeholder; or
243 (ii) goods or services provided at less than fair market value to or for the benefit of the
244 officeholder.

245 (b) "Public service assistance" does not include:
246 (i) anything provided by the state;
247 (ii) services provided without compensation by individuals volunteering a portion or all
248 of their time on behalf of an officeholder;
249 (iii) money lent to an officeholder by a financial institution in the ordinary course of
250 business;
251 (iv) news coverage or any publication by the news media; or
252 (v) any article, story, or other coverage as part of any regular publication of any
253 organization unless substantially all the publication is devoted to information about the
254 officeholder.
255 [(35)] (36) "Publicly identified class of individuals" means a group of 50 or more
256 individuals sharing a common occupation, interest, or association that contribute to a political
257 action committee or political issues committee and whose names can be obtained by contacting
258 the political action committee or political issues committee upon whose financial report they
259 are listed.
260 [(36)] (37) "Receipts" means contributions and public service assistance.
261 [(37)] (38) "Registered lobbyist" means a person registered under Title 36, Chapter 11,
262 Lobbyist Disclosure and Regulation Act.
263 [(38)] (39) "Registered political action committee" means any political action
264 committee that is required by this chapter to file a statement of organization with the lieutenant
265 governor's office.
266 [(39)] (40) "Registered political issues committee" means any political issues
267 committee that is required by this chapter to file a statement of organization with the lieutenant
268 governor's office.
269 [(40)] (41) "Registered political party" means an organization of voters that:
270 (a) participated in the last regular general election and polled a total vote equal to 2%
271 or more of the total votes cast for all candidates for the United States House of Representatives
272 for any of its candidates for any office; or
273 (b) has complied with the petition and organizing procedures of this chapter.
274 [(41)] (42) "Report" means a verified financial statement.
275 [(42)] (43) "Reporting entity" means a candidate, a candidate's personal campaign

276 committee, an officeholder, and a party committee, a political action committee, and a political
277 issues committee.
278 [(43)] (44) "School board office" means the office of state school board or local school
279 board.
280 [(44)] (45) (a) "Source" means the person or entity that is the legal owner of the
281 tangible or intangible asset that comprises the contribution.
282 (b) "Source" means, for political action committees and corporations, the political
283 action committee and the corporation as entities, not the contributors to the political action
284 committee or the owners or shareholders of the corporation.
285 [(45)] (46) "State office" means the offices of governor, lieutenant governor, attorney
286 general, state auditor, and state treasurer.
287 [(46)] (47) "State office candidate" means a person who:
288 (a) files a declaration of candidacy for a state office; or
289 (b) receives contributions, makes expenditures, or gives consent for any other person to
290 receive contributions or make expenditures to bring about the person's nomination or election
291 to a state office.
292 [(47)] (48) "Summary report" means the year end report containing the summary of a
293 reporting entity's contributions and expenditures.
294 [(48)] (49) "Supervisory board" means the individual or group of individuals that
295 allocate expenditures from a political issues committee.
296 Section 2. Section 20A-11-201 is amended to read:
297 20A-11-201. State office candidate -- Separate bank account for campaign funds.
298 (1) (a) Each state office candidate or the candidate's personal campaign committee
299 shall deposit each contribution and public service assistance received in one or more separate
300 campaign accounts in a financial institution.
301 (b) (i) The state office candidate or the candidate's personal campaign committee may
302 use the monies in those accounts only for political purposes.
303 (ii) The state office candidate or the candidate's personal committee may not use the
304 monies in those accounts for personal use.
305 (2) A state office candidate or the candidate's personal campaign committee may not
306 deposit or mingle any contributions received into a personal or business account.

307 (3) If a person [who] withdraws or is eliminated in a convention, primary, or regular
308 general election, or is no longer a state office candidate [chooses not to expend the monies
309 remaining in his campaign account], the person shall dispose of monies remaining in the
310 person's campaign account by:
311 (a) donating the monies to a registered political party or political action committee;
312 (b) donating the monies to the state General Fund;
313 (c) expending the monies for political purposes;
314 (d) donating the monies to a tax-exempt, nonprofit entity;
315 (e) repaying documented loans to the state office candidate's campaign;
316 (f) donating the monies to another candidate's campaign account;
317 (g) transferring the monies to an escrow account for the person to use as a candidate for
318 public office; or
319 (h) some combination of Subsections (3)(a) through (g).
320 (4) (a) The person shall continue to file the year-end summary report required by
321 Section 20A-11-203 until the statement of dissolution and final summary report required by
322 Section 20A-11-205 are filed with the lieutenant governor.
323 (b) Any person who fails to file the report required by this Subsection (4) is subject to
324 an administrative penalty of up to $1,000 for each violation.
325 Section 3. Section 20A-11-301 is amended to read:
326 20A-11-301. Legislative office candidate -- Campaign requirements.
327 (1) Each legislative office candidate shall deposit each contribution and public service
328 assistance received in one or more separate accounts in a financial institution that are dedicated
329 only to that purpose.
330 (2) A legislative office candidate may not deposit or mingle any contributions or public
331 service assistance received into a personal or business account.
332 (3) (a) A legislative office candidate may not make any political expenditures
333 prohibited by law.
334 (b) A legislative office candidate may not use monies in the accounts required by this
335 section for personal use.
336 (4) If a person [who] withdraws or is eliminated in a convention, primary, or regular
337 general election, or is no longer a legislative candidate [chooses not to expend the monies

338 remaining in his campaign account], the person shall dispose of monies remaining in the
339 person's campaign account by:
340 (a) donating the monies to a registered political party or political action committee;
341 (b) donating the monies to the state General Fund;
342 (c) expending the monies for political purposes;
343 (d) donating the monies to a tax-exempt, nonprofit entity;
344 (e) repaying documented loans to the legislative candidate's campaign;
345 (f) donating the monies to another candidate's campaign account;
346 (g) transferring the monies to an escrow account for the person to use as a candidate for
347 public office; or
348 (h) some combination of Subsections (4)(a) through (g).
349 (5) (a) The person shall continue to file the year-end summary report required by
350 Section 20A-11-302 until the statement of dissolution and final summary report required by
351 Section 20A-11-304 are filed with the lieutenant governor.
352 (b) Any person who fails to file the report required by this Subsection (5) is subject to
353 an administrative penalty of up to $1,000 for each violation.
354 Section 4. Section 20A-11-402 is amended to read:
355 20A-11-402. Officeholder financial reporting requirements -- Termination of
356 duty to report.
357 (1) An officeholder is active and subject to reporting requirements until the
358 officeholder has filed a statement of dissolution with the lieutenant governor stating that:
359 (a) the officeholder is no longer receiving contributions or public service assistance and
360 is no longer making expenditures;
361 (b) the ending balance on the last summary report filed is zero and the balance in the
362 separate bank account required by Sections 20A-11-201 and 20A-11-301 is zero; and
363 (c) a final summary report in the form required by Section 20A-11-401 showing a zero
364 balance is attached to the statement of dissolution.
365 (2) A statement of dissolution and a final summary report may be filed at any time.
366 (3) (a) Each officeholder shall continue to file the year-end summary report required by
367 Section 20A-11-401 until the statement of dissolution and final summary report required by
368 this section are filed with the lieutenant governor.

369 (b) Any person who fails to file the report required by this Subsection (3) is subject to
370 an administrative penalty of up to $1,000 for each violation.
371 (4) When an officeholder leaves office, the person shall dispose of monies remaining
372 in the person's campaign accounts required by Sections 20A-11-201 and 20A-11-301 by:
373 (a) donating the monies to a registered political party or political action committee;
374 (b) donating the monies to the state General Fund;
375 (c) expending the monies for political purposes;
376 (d) donating the monies to a tax-exempt, nonprofit entity;
377 (e) repaying documented loans to the officeholder's campaign;
378 (f) donating the monies to another candidate's campaign account;
379 (g) transferring the monies to an escrow account for the person to use as a candidate for
380 public office; or
381 (h) some combination of Subsections (4)(a) through (g).
382 Section 5. Section 20A-11-1301 is amended to read:
383 20A-11-1301. School board office candidate -- Campaign requirements.
384 (1) Each school board office candidate shall deposit each contribution and public
385 service assistance received in one or more separate accounts in a financial institution that are
386 dedicated only to that purpose.
387 (2) (a) A school board office candidate may not deposit or mingle any contributions or
388 public service assistance received into a personal or business account.
389 (b) The school board office candidate may not use the monies in those accounts for
390 personal use.
391 (3) A school board office candidate may not make any political expenditures prohibited
392 by law.
393 (4) If a person [who] withdraws or is eliminated in a regular general election or is no
394 longer a school board candidate [chooses not to expend the monies remaining in his campaign
395 account], the person shall dispose of monies remaining in the person's campaign account by:
396 (a) donating the monies to a registered political party or political action committee;
397 (b) donating the monies to the state General Fund;
398 (c) expending the monies for political purposes;
399 (d) donating the monies to a tax-exempt, nonprofit entity;

400 (e) repaying documented loans to the school board office candidate's campaign;
401 (f) donating the monies to another candidate's campaign account;
402 (g) transferring the monies to an escrow account for the person to use as a candidate for
403 public office; or
404 (h) some combination of Subsections (4)(a) through (g).
405 (5) (a) The person shall continue to file the year-end summary report required by
406 Section 20A-11-1302 until the statement of dissolution and final summary report required by
407 Section 20A-11-1304 are filed with:
408 [(a)] (i) the lieutenant governor in the case of a state school board candidate; and
409 [(b)] (ii) the county clerk, in the case of a local school board candidate.
410 (b) Any person who fails to file the report required by this Subsection (5) is subject to
411 an administrative penalty of up to $1,000 for each violation.




Legislative Review Note
as of 11-27-04 2:27 PM

Based on a limited legal review, this legislation has not been determined to have a high
probability of being held unconstitutional.

Office of Legislative Research and General Counsel