S.B. 73

1

PERSONAL USE OF CAMPAIGN FUNDS
2 2006 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Karen Hale
5 House Sponsor: ____________
6
7 LONG TITLE
8 General Description:
9 This bill modifies the Election Code by enacting provisions governing the personal use
10 and disposition of campaign funds.
11 Highlighted Provisions:
12 This bill:
13 . defines terms;
14 . establishes requirements for the disposition or transfer of monies remaining in
15 campaign accounts;
16 . prohibits owners of campaign accounts from expending campaign monies for
17 personal use; and
18 . provides a civil penalty for a violation of the requirements.
19 Monies Appropriated in this Bill:
20 None
21 Other Special Clauses:
22 None
23 Utah Code Sections Affected:
24 AMENDS:
25 20A-11-101, as last amended by Chapter 90, Laws of Utah 2004
26 20A-11-201, as last amended by Chapter 355, Laws of Utah 1997
27 20A-11-301, as last amended by Chapter 355, Laws of Utah 1997

28 20A-11-402, as last amended by Chapter 355, Laws of Utah 1997
29 20A-11-1301, as enacted by Chapter 355, Laws of Utah 1997
30
31 Be it enacted by the Legislature of the state of Utah:
32 Section 1. Section 20A-11-101 is amended to read:
33 20A-11-101. Definitions.
34 As used in this chapter:
35 (1) "Address" means the number and street where an individual resides or where a
36 reporting entity has its principal office.
37 (2) "Ballot proposition" includes initiatives, referenda, proposed constitutional
38 amendments, and any other ballot propositions submitted to the voters that are authorized by
39 the Utah Code Annotated 1953.
40 (3) "Candidate" means any person who:
41 (a) files a declaration of candidacy for a public office; or
42 (b) receives contributions, makes expenditures, or gives consent for any other person to
43 receive contributions or make expenditures to bring about the person's nomination or election
44 to a public office.
45 (4) "Chief election officer" means:
46 (a) the lieutenant governor for state office candidates, legislative office candidates,
47 officeholders, political parties, political action committees, corporations, political issues
48 committees, and state school board candidates; and
49 (b) the county clerk for local school board candidates.
50 (5) "Continuing political party" means an organization of voters that participated in the
51 last regular general election and polled a total vote equal to 2% or more of the total votes cast
52 for all candidates for the United States House of Representatives.
53 (6) (a) "Contribution" means any of the following when done for political purposes:
54 (i) a gift, subscription, donation, loan, advance, or deposit of money or anything of
55 value given to the filing entity;
56 (ii) an express, legally enforceable contract, promise, or agreement to make a gift,
57 subscription, donation, unpaid or partially unpaid loan, advance, or deposit of money or
58 anything of value to the filing entity;

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

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

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

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

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

214 (ii) money lent to a political issues committee by a financial institution in the ordinary
215 course of business.
216 [(30)] (31) (a) "Political issues expenditure" means any of the following:
217 (i) any payment from political issues contributions made for the purpose of influencing
218 the approval or the defeat of a statewide ballot proposition;
219 (ii) a purchase, payment, distribution, loan, advance, deposit, or gift of money made for
220 the purpose of influencing the approval or the defeat of a statewide ballot proposition;
221 (iii) an express, legally enforceable contract, promise, or agreement to make any
222 political issues expenditure;
223 (iv) compensation paid by a reporting entity for personal services rendered by a person
224 without charge to a political issues committee; or
225 (v) goods or services provided to or for the benefit of another reporting entity at less
226 than fair market value.
227 (b) "Political issues expenditure" does not include:
228 (i) services provided without compensation by individuals volunteering a portion or all
229 of their time on behalf of a political issues committee; or
230 (ii) money lent to a political issues committee by a financial institution in the ordinary
231 course of business.
232 [(31)] (32) "Political purposes" means an act done with the intent or in a way to
233 influence or tend to influence, directly or indirectly, any person to refrain from voting or to vote
234 for or against any candidate for public office at any caucus, political convention, primary, or
235 election.
236 [(32)] (33) "Primary election" means any regular primary election held under the
237 election laws.
238 [(33)] (34) "Public office" means the office of governor, lieutenant governor, state
239 auditor, state treasurer, attorney general, state or local school board member, state senator, state
240 representative, speaker of the House of Representatives, president of the Senate, and the leader,
241 whip, and assistant whip of any party caucus in either house of the Legislature.
242 [(34)] (35) (a) "Public service assistance" means the following when given or provided
243 to an officeholder to defray the costs of functioning in a public office or aid the officeholder to
244 communicate with the officeholder's constituents:

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

276 for any of its candidates for any office; or
277 (b) has complied with the petition and organizing procedures of this chapter.
278 [(41)] (42) "Report" means a verified financial statement.
279 [(42)] (43) "Reporting entity" means a candidate, a candidate's personal campaign
280 committee, an officeholder, and a party committee, a political action committee, and a political
281 issues committee.
282 [(43)] (44) "School board office" means the office of state school board or local school
283 board.
284 [(44)] (45) (a) "Source" means the person or entity that is the legal owner of the
285 tangible or intangible asset that comprises the contribution.
286 (b) "Source" means, for political action committees and corporations, the political
287 action committee and the corporation as entities, not the contributors to the political action
288 committee or the owners or shareholders of the corporation.
289 [(45)] (46) "State office" means the offices of governor, lieutenant governor, attorney
290 general, state auditor, and state treasurer.
291 [(46)] (47) "State office candidate" means a person who:
292 (a) files a declaration of candidacy for a state office; or
293 (b) receives contributions, makes expenditures, or gives consent for any other person to
294 receive contributions or make expenditures to bring about the person's nomination or election
295 to a state office.
296 [(47)] (48) "Summary report" means the year end report containing the summary of a
297 reporting entity's contributions and expenditures.
298 [(48)] (49) "Supervisory board" means the individual or group of individuals that
299 allocate expenditures from a political issues committee.
300 Section 2. Section 20A-11-201 is amended to read:
301 20A-11-201. State office candidate -- Separate bank account for campaign funds.
302 (1) (a) Each state office candidate or the candidate's personal campaign committee
303 shall deposit each contribution and public service assistance received in one or more separate
304 campaign accounts in a financial institution.
305 (b) (i) The state office candidate or the candidate's personal campaign committee may
306 use the monies in those accounts only for political purposes.

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

338 (b) A legislative office candidate may not use monies in the accounts required by this
339 section for personal use expenditures.
340 (4) If a person [who] withdraws or is eliminated in a convention, primary, or regular
341 general election, or is no longer a legislative candidate [chooses not to expend the monies
342 remaining in his campaign account], the person shall dispose of monies remaining in the
343 person's campaign account by:
344 (a) donating the monies to a registered political party or political action committee;
345 (b) donating the monies to the state General Fund;
346 (c) expending the monies for political purposes;
347 (d) donating the monies to a tax-exempt, nonprofit entity;
348 (e) repaying documented loans to the legislative office candidate's campaign;
349 (f) donating the monies to another candidate's campaign account;
350 (g) transferring the monies to an escrow account for the person to use as a candidate for
351 public office; or
352 (h) some combination of Subsections (4)(a) through (g).
353 (5) (a) The person shall continue to file the year-end summary report required by
354 Section 20A-11-302 until the statement of dissolution and final summary report required by
355 Section 20A-11-304 are filed with the lieutenant governor.
356 (b) Any person who fails to file the report required by this Subsection (5) is subject to
357 an administrative penalty of up to $1,000 for each violation.
358 Section 4. Section 20A-11-402 is amended to read:
359 20A-11-402. Officeholder financial reporting requirements -- Termination of
360 duty to report.
361 (1) An officeholder is active and subject to reporting requirements until the
362 officeholder has filed a statement of dissolution with the lieutenant governor stating that:
363 (a) the officeholder is no longer receiving contributions or public service assistance and
364 is no longer making expenditures;
365 (b) the ending balance on the last summary report filed is zero and the balance in the
366 separate bank account required by Sections 20A-11-201 and 20A-11-301 is zero; and
367 (c) a final summary report in the form required by Section 20A-11-401 showing a zero
368 balance is attached to the statement of dissolution.

369 (2) A statement of dissolution and a final summary report may be filed at any time.
370 (3) (a) Each officeholder shall continue to file the year-end summary report required by
371 Section 20A-11-401 until the statement of dissolution and final summary report required by
372 this section are filed with the lieutenant governor.
373 (b) Any person who fails to file the report required by this Subsection (3) is subject to
374 an administrative penalty of up to $1,000 for each violation.
375 (4) When an officeholder leaves office, the person shall dispose of monies remaining
376 in the person's campaign accounts required by Sections 20A-11-201 and 20A-11-301 by:
377 (a) donating the monies to a registered political party or political action committee;
378 (b) donating the monies to the state General Fund;
379 (c) expending the monies for political purposes;
380 (d) donating the monies to a tax-exempt, nonprofit entity;
381 (e) repaying documented loans to the officeholder's campaign;
382 (f) donating the monies to another candidate's campaign account;
383 (g) transferring the monies to an escrow account for the person to use as a candidate for
384 public office; or
385 (h) some combination of Subsections (4)(a) through (g).
386 Section 5. Section 20A-11-1301 is amended to read:
387 20A-11-1301. School board office candidate -- Campaign requirements.
388 (1) Each school board office candidate shall deposit each contribution and public
389 service assistance received in one or more separate accounts in a financial institution that are
390 dedicated only to that purpose.
391 (2) (a) A school board office candidate may not deposit or mingle any contributions or
392 public service assistance received into a personal or business account.
393 (b) The school board office candidate may not use the monies in those accounts for
394 personal use expenditures.
395 (3) A school board office candidate may not make any political expenditures prohibited
396 by law.
397 (4) If a person [who] withdraws or is eliminated in a regular general election or is no
398 longer a school board candidate [chooses not to expend the monies remaining in his campaign
399 account], the person shall dispose of monies remaining in the person's campaign account by:

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




Legislative Review Note
as of 11-22-05 3:59 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