1     
POLITICAL COMMITTEES AMENDMENTS

2     
2019 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Brad M. Daw

5     
Senate Sponsor: Curtis S. Bramble

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions related to financial reporting requirements for a political
10     action committee and a political issues committee.
11     Highlighted Provisions:
12          This bill:
13          ▸     requires a political action committee to file a financial statement before a county
14     political convention under certain circumstances;
15          ▸     requires a political issues committee, under certain circumstances, to report the
16     receipt of a contribution within three business days after the contribution's receipt;
17          ▸     amends the deadline by which a political issues committee is required to file a
18     financial statement before an initiative or referendum petition is submitted;
19          ▸     establishes civil penalties; and
20          ▸     makes technical changes.
21     Money Appropriated in this Bill:
22          None
23     Other Special Clauses:
24          None
25     Utah Code Sections Affected:
26     AMENDS:
27          20A-11-602, as last amended by Laws of Utah 2018, Chapter 83

28          20A-11-603, as last amended by Laws of Utah 2015, Chapter 204
29          20A-11-801, as last amended by Laws of Utah 2018, Chapter 83
30          20A-11-802, as last amended by Laws of Utah 2018, Chapter 83
31     

32     Be it enacted by the Legislature of the state of Utah:
33          Section 1. Section 20A-11-602 is amended to read:
34          20A-11-602. Political action committees -- Financial reporting.
35          (1) (a) Each registered political action committee that has received contributions
36     totaling at least $750, or disbursed expenditures totaling at least $750, during a calendar year
37     shall file a verified financial statement with the lieutenant governor's office:
38          (i) on January 10, reporting contributions and expenditures as of December 31 of the
39     previous year;
40          (ii) seven days before the state political convention of each major political party;
41          (iii) seven days before the county political convention of a political party, if the
42     political action committee makes an expenditure on or before the day described in Subsection
43     (1)(b)(ii) in relation to a candidate that the party may nominate at the convention;
44          [(iii)] (iv) seven days before the regular primary election date;
45          [(iv)] (v) on September 30; and
46          [(v)] (vi) seven days before:
47          (A) the municipal general election; and
48          (B) the regular general election [date].
49          (b) The registered political action committee shall report:
50          (i) a detailed listing of all contributions received and expenditures made since the last
51     statement; and
52          (ii) for a financial statement described in Subsections (1)(a)(ii) through [(iv)] (v), all
53     contributions and expenditures as of five days before the required filing date of the financial
54     statement.
55          (c) The registered political action committee need not file a statement under this
56     section if it received no contributions and made no expenditures during the reporting period.
57          (2) (a) The verified financial statement shall include:
58          (i) the name and address of any individual who makes a contribution to the reporting

59     political action committee, if known, and the amount of the contribution;
60          (ii) the identification of any publicly identified class of individuals that makes a
61     contribution to the reporting political action committee, if known, and the amount of the
62     contribution;
63          (iii) the name and address of any political action committee, group, or entity, if known,
64     that makes a contribution to the reporting political action committee, and the amount of the
65     contribution;
66          (iv) for each nonmonetary contribution, the fair market value of the contribution;
67          (v) the name and address of each reporting entity that received an expenditure from the
68     reporting political action committee, and the amount of each expenditure;
69          (vi) for each nonmonetary expenditure, the fair market value of the expenditure;
70          (vii) the total amount of contributions received and expenditures disbursed by the
71     reporting political action committee;
72          (viii) a statement by the political action committee's treasurer or chief financial officer
73     certifying that, to the best of the person's knowledge, the financial report is accurate; and
74          (ix) a summary page in the form required by the lieutenant governor that identifies:
75          (A) beginning balance;
76          (B) total contributions during the period since the last statement;
77          (C) total contributions to date;
78          (D) total expenditures during the period since the last statement; and
79          (E) total expenditures to date.
80          (b) (i) Contributions received by a political action committee that have a value of $50
81     or less need not be reported individually, but shall be listed on the report as an aggregate total.
82          (ii) Two or more contributions from the same source that have an aggregate total of
83     more than $50 may not be reported in the aggregate, but shall be reported separately.
84          (3) A group or entity may not divide or separate into units, sections, or smaller groups
85     for the purpose of avoiding the financial reporting requirements of this chapter, and substance
86     shall prevail over form in determining the scope or size of a political action committee.
87          (4) (a) As used in this Subsection (4), "received" means:
88          (i) for a cash contribution, that the cash is given to a political action committee;
89          (ii) for a contribution that is a negotiable instrument or check, that the negotiable

90     instrument or check is negotiated; and
91          (iii) for any other type of contribution, that any portion of the contribution's benefit
92     inures to the political action committee.
93          (b) A political action committee shall report each contribution to the lieutenant
94     governor within 31 days after the contribution is received.
95          (5) A political action committee may not expend a contribution for political purposes if
96     the contribution:
97          (a) is cash or a negotiable instrument;
98          (b) exceeds $50; and
99          (c) is from an unknown source.
100          (6) Within 31 days after receiving a contribution that is cash or a negotiable
101     instrument, exceeds $50, and is from an unknown source, a political action committee shall
102     disburse the amount of the contribution to:
103          (a) the treasurer of the state or a political subdivision for deposit into the state's or
104     political subdivision's general fund; or
105          (b) an organization that is exempt from federal income taxation under Section
106     501(c)(3), Internal Revenue Code.
107          Section 2. Section 20A-11-603 is amended to read:
108          20A-11-603. Criminal penalties -- Fines.
109          (1) (a) Each political action committee that fails to file a financial statement by the
110     deadline is subject to a fine imposed in accordance with Section 20A-11-1005.
111          (b) Each political action committee that fails to file a financial statement described in
112     Subsections 20A-11-602(1)(a)[(iii)](iv) through [(v)] (vi) is guilty of a class B misdemeanor.
113          (c) The lieutenant governor shall report all violations of Subsection (1)(b) to the
114     attorney general.
115          (2) Within 30 days after a deadline for the filing of the January 10 statement required
116     by this part, the lieutenant governor shall review each filed statement to ensure that:
117          (a) each political action committee that is required to file a statement has filed one; and
118          (b) each statement contains the information required by this part.
119          (3) If it appears that any political action committee has failed to file the January 10
120     statement, if it appears that a filed statement does not conform to the law, or if the lieutenant

121     governor has received a written complaint alleging a violation of the law or the falsity of any
122     statement, the lieutenant governor shall, within five days of discovery of a violation or receipt
123     of a written complaint, notify the political action committee of the violation or written
124     complaint and direct the political action committee to file a statement correcting the problem.
125          (4) (a) It is unlawful for any political action committee to fail to file or amend a
126     statement within seven days after receiving notice from the lieutenant governor under this
127     section.
128          (b) Each political action committee that violates Subsection (4)(a) is guilty of a class B
129     misdemeanor.
130          (c) The lieutenant governor shall report all violations of Subsection (4)(a) to the
131     attorney general.
132          (d) In addition to the criminal penalty described in Subsection (4)(b), the lieutenant
133     governor shall impose a civil fine of $1,000 against a political action committee that violates
134     Subsection (4)(a).
135          Section 3. Section 20A-11-801 is amended to read:
136          20A-11-801. Political issues committees -- Registration -- Criminal penalty for
137     providing false information or accepting unlawful contribution.
138          (1) (a) Each political issues committee shall file a statement of organization with the
139     lieutenant governor's office by January 10 of each year, unless the political issues committee
140     has filed a notice of dissolution under Subsection (4).
141          (b) If a political issues committee is organized after the January 10 filing date, the
142     political issues committee shall file an initial statement of organization no later than seven days
143     after:
144          (i) receiving political issues contributions totaling at least $750; or
145          (ii) disbursing political issues expenditures totaling at least $750.
146          (c) Each political issues committee shall deposit each contribution received into one or
147     more separate accounts in a financial institution that are dedicated only to that purpose.
148          (2) Each political issues committee shall designate two officers that have primary
149     decision-making authority for the political issues committee.
150          (3) The statement of organization shall include:
151          (a) the name and street address of the political issues committee;

152          (b) the name, street address, phone number, occupation, and title of the two primary
153     officers designated under Subsection (2);
154          (c) the name, street address, occupation, and title of all other officers of the political
155     issues committee;
156          (d) the name and street address of the organization, individual, corporation,
157     association, unit of government, or union that the political issues committee represents, if any;
158          (e) the name and street address of all affiliated or connected organizations and their
159     relationships to the political issues committee;
160          (f) the name, street address, business address, occupation, and phone number of the
161     committee's treasurer or chief financial officer;
162          (g) the name, street address, and occupation of each member of the supervisory and
163     advisory boards, if any; and
164          (h) the ballot proposition whose outcome they wish to affect, and whether they support
165     or oppose it.
166          (4) (a) Any registered political issues committee that intends to permanently cease
167     operations during a calendar year shall:
168          (i) dispose of all remaining funds by returning the funds to donors or donating the
169     funds to an organization that is exempt from federal income taxation under Section 501(c)(3),
170     Internal Revenue Code; and
171          (ii) after complying with Subsection (4)(a)(i), file a notice of dissolution with the
172     lieutenant governor's office.
173          (b) Any notice of dissolution filed by a political issues committee does not exempt that
174     political issues committee from complying with the financial reporting requirements of this
175     chapter.
176          (5) (a) Unless the political issues committee has filed a notice of dissolution under
177     Subsection (4), a political issues committee shall file, with the lieutenant governor's office,
178     notice of any change of an officer described in Subsection (2).
179          (b) Notice of a change of a primary officer described in Subsection (2) shall:
180          (i) be filed within 10 days of the date of the change; and
181          (ii) contain the name and title of the officer being replaced and the name, street
182     address, occupation, and title of the new officer.

183          (6) (a) A person is guilty of providing false information in relation to a political issues
184     committee if the person intentionally or knowingly gives false or misleading material
185     information in the statement of organization or the notice of change of primary officer.
186          (b) Each primary officer designated in Subsection (2) is guilty of accepting an unlawful
187     contribution if the political issues committee knowingly or recklessly accepts a contribution
188     from a corporation that:
189          (i) was organized less than 90 days before the date of the general election; and
190          (ii) at the time the political issues committee accepts the contribution, has failed to file
191     a statement of organization with the lieutenant governor's office as required by Section
192     20A-11-704.
193          (c) A violation of this Subsection (6) is a third degree felony.
194          (7) (a) As used in this Subsection (7), "received" means:
195          (i) for a cash contribution, that the cash is given to a political issues committee;
196          (ii) for a contribution that is a negotiable instrument or check, that the negotiable
197     instrument or check is negotiated; and
198          (iii) for any other type of contribution, that any portion of the contribution's benefit
199     inures to the political issues committee.
200          (b) Each political issues committee shall report to the lieutenant governor each
201     contribution received by the political issues committee within three business days after the day
202     on which the contribution is received if the contribution is received within 30 days before the
203     last day on which the sponsors of the initiative or referendum described in Subsection
204     20A-11-801(3)(h) may submit signatures to qualify the initiative or referendum for the ballot.
205          (c) For each contribution that a political issues committee fails to report within the
206     period described in Subsection (7)(b), the lieutenant governor shall impose a fine against the
207     political issues committee in an amount equal to:
208          (i) 10% of the amount of the contribution, if the political issues committee reports the
209     contribution within 60 days after the last day on which the political issues committee should
210     have reported the contribution under Subsection (7)(b); or
211          (ii) 20% of the amount of the contribution, if the political issues committee fails to
212     report the contribution within 60 days after the last day on which the political issues committee
213     should have reported the contribution under Subsection (7)(b).

214          (d) The lieutenant governor shall:
215          (i) deposit money received under Subsection (7)(c) into the General Fund; and
216          (ii) report on the lieutenant governor's website, in the location where reports relating to
217     each political issues committee are available for public access:
218          (A) each fine imposed by the lieutenant governor against the political issues
219     committee;
220          (B) the amount of the fine;
221          (C) the amount of the contribution to which the fine relates; and
222          (D) the date of the contribution.
223          Section 4. Section 20A-11-802 is amended to read:
224          20A-11-802. Political issues committees -- Financial reporting.
225          (1) (a) Each registered political issues committee that has received political issues
226     contributions totaling at least $750, or disbursed political issues expenditures totaling at least
227     $750, during a calendar year, shall file a verified financial statement with the lieutenant
228     governor's office:
229          (i) on January 10, reporting contributions and expenditures as of December 31 of the
230     previous year;
231          (ii) seven days before the state political convention of each major political party;
232          (iii) seven days before the regular primary election date;
233          (iv) seven days before the date of an incorporation election, if the political issues
234     committee has received [donations or made disbursements] or expended funds to affect an
235     incorporation;
236          (v) at least three days before the first public hearing held as required by Section
237     20A-7-204.1;
238          (vi) if the political issues committee has received or expended funds in relation to an
239     initiative or referendum, [at the time the] five days before the deadline for the initiative or
240     referendum sponsors to submit:
241          (A) the verified and certified initiative packets [as required by] under Section
242     20A-7-206; or
243          (B) the signed and verified referendum packets [as required by] under Section
244     20A-7-306;

245          (vii) on September 30; and
246          (viii) seven days before:
247          (A) the municipal general election; and
248          (B) the regular general election.
249          (b) The political issues committee shall report:
250          (i) a detailed listing of all contributions received and expenditures made since the last
251     statement; and
252          (ii) all contributions and expenditures as of five days before the required filing date of
253     the financial statement, except for a financial statement filed on January 10.
254          (c) The political issues committee need not file a statement under this section if it
255     received no contributions and made no expenditures during the reporting period.
256          (2) (a) That statement shall include:
257          (i) the name and address, if known, of any individual who makes a political issues
258     contribution to the reporting political issues committee, and the amount of the political issues
259     contribution;
260          (ii) the identification of any publicly identified class of individuals that makes a
261     political issues contribution to the reporting political issues committee, and the amount of the
262     political issues contribution;
263          (iii) the name and address, if known, of any political issues committee, group, or entity
264     that makes a political issues contribution to the reporting political issues committee, and the
265     amount of the political issues contribution;
266          (iv) the name and address of each reporting entity that makes a political issues
267     contribution to the reporting political issues committee, and the amount of the political issues
268     contribution;
269          (v) for each nonmonetary contribution, the fair market value of the contribution;
270          (vi) except as provided in Subsection (2)(c), the name and address of each individual,
271     entity, or group of individuals or entities that received a political issues expenditure of more
272     than $50 from the reporting political issues committee, and the amount of each political issues
273     expenditure;
274          (vii) for each nonmonetary expenditure, the fair market value of the expenditure;
275          (viii) the total amount of political issues contributions received and political issues

276     expenditures disbursed by the reporting political issues committee;
277          (ix) a statement by the political issues committee's treasurer or chief financial officer
278     certifying that, to the best of the person's knowledge, the financial statement is accurate; and
279          (x) a summary page in the form required by the lieutenant governor that identifies:
280          (A) beginning balance;
281          (B) total contributions during the period since the last statement;
282          (C) total contributions to date;
283          (D) total expenditures during the period since the last statement; and
284          (E) total expenditures to date.
285          (b) (i) Political issues contributions received by a political issues committee that have a
286     value of $50 or less need not be reported individually, but shall be listed on the report as an
287     aggregate total.
288          (ii) Two or more political issues contributions from the same source that have an
289     aggregate total of more than $50 may not be reported in the aggregate, but shall be reported
290     separately.
291          (c) When reporting political issue expenditures made to circulators of initiative
292     petitions, the political issues committee:
293          (i) need only report the amount paid to each initiative petition circulator; and
294          (ii) need not report the name or address of the circulator.
295          (3) (a) As used in this Subsection (3), "received" means:
296          (i) for a cash contribution, that the cash is given to a political issues committee;
297          (ii) for a contribution that is a negotiable instrument or check, that the negotiable
298     instrument or check is negotiated; and
299          (iii) for any other type of contribution, that any portion of the contribution's benefit
300     inures to the political issues committee.
301          (b) A political issues committee shall report each contribution to the lieutenant
302     governor within 31 days after the contribution is received.
303          (4) A political issues committee may not expend a contribution for a political issues
304     expenditure if the contribution:
305          (a) is cash or a negotiable instrument;
306          (b) exceeds $50; and

307          (c) is from an unknown source.
308          (5) Within 31 days after receiving a contribution that is cash or a negotiable
309     instrument, exceeds $50, and is from an unknown source, a political issues committee shall
310     disburse the amount of the contribution to:
311          (a) the treasurer of the state or a political subdivision for deposit into the state's or
312     political subdivision's general fund; or
313          (b) an organization that is exempt from federal income taxation under Section
314     501(c)(3), Internal Revenue Code.