State Campaign Finance

Discussion

The following discussion provides a summary explanation of each of the principles listed in our Statement of Principles:

1. Disclosure:<\/u> The Committee favors full and accurate disclosure of campaign contributions and expenditures. Pre-election reports should be filed sufficiently close to the date of election so that late contributions are disclosed. In addition, the disclosure of large last-minute contributions is important to prevent an undisclosed infusion of large contributions shortly before the election. The last-minute report should include the disclosure of contributions made within a day or two of the election. Requiring the timely reporting of contributions and expenditures to candidates has long been recognized as a justified and legitimate means for preventing corrupt practices and undue influence. Recent studies have reaffirmed the critical needs for meaningful disclosure.The threshold amounts that would trigger the disclosure requirement should be set at reasonable levels to ensure disclosure of significant campaign activity. All political activity should be disclosed and information relating to contributions and expenditures exceeding de minimus amounts should be detailed. Detailed reporting of contributions should include an itemization of each contributor's name, address, occupation, and employer. A committee's report should disclose the amount of each contribution and the cumulative amount of contributions from each contributor for the election cycle. For expenditures, a committee should identify the name and address of the payee, a description of the purpose of the expenditure, and the amount of the expenditure. A person or committee that makes an independent expenditure should disclose name and address of the payee and the purpose of the expenditure. The last-minute reporting requirements should apply to independent expenditures in the same way they apply to other reporting entities. Also, all communications made by an independent should carry a clear and conspicuous disclaimer stating the identity of the person or committee that paid for and authorized the communication. The disclaimer should also state whether or not a candidate has authorized the communication. All candidates and political committees should be required to file reports in their state which are usable and meaningful. Moreover, the governmental entity that administers the campaign finance laws should make the information easily accessible to the public. Aside from opening up the political process to the public and press, full disclosure would provide members of the public with the opportunity ta judge for themselves whether the contributions unduly influenced the officeholder. Disclosure of political activity provides the most effective means for discovery of violations of the law and could prove helpful in analyzing and developing new recommendations to improve the regulation of financing campaigns.
2. Contribution Limitations:<\/u> Large contributions should be subject to reasonable limitations because they may have a corrupting influence or the appearance of a corrupting influence on the political process. We do not recommend any specific limitation amount, but each state should determine a limitation sufficiently high to permit meaningful expression of support and, at the same time, not so high as to afford the contributor undue influence. Also, contribution limits should not be so low that the candidates spends an inordinate amount of time fund-raising. Contribution limits should apply to direct payments to political committees as well as in-kind contributions, such as the donation of office equipment and mailing lists. Non-bank loans should be subject to the contribution limits. Loans from banks and other financial institutions may exceed the contribution limits but must be made in the ordinary course of their business. The law should contain a provision to prevent entities which are controlled or coordinated by the same person from making contributions which, in the aggregate, exceed the contribution limits. Affiliated entities should be bound by a common contribution limit and treated as a single entity for purposes of the contribution limits.
   
3. Enforcement:<\/u> We strongly support the creation of an effective independent agency to supervise elections in order to ensure compliance with campaign finance laws. Prior to the creation of the Federal Election Commission, the federal campaign finance law was not enforced because there were only criminal penalties for violations that did not warrant such harsh penalties and there was no independent agency vested with the authority to administer the campaign finance laws. For example, we should look at procedures that will enable the agency to publish the name of a committee that files a late report prior to an election. For allegations that require an investigation to determine whether a violation occurred, the processing of those cases should be expeditious so that they are resolved before or shortly after the election. The agency should have authority to issue advisory opinions to candidates, their committees, and to affected citizens. A critical function of the agency should be to promulgate regulations so that the law is clearly understood. Also, the agency should computerize campaign finance data and compile the information so that it may be readily used and understood by the public and the press. The effectiveness of an enforcement entity will depend on its independence from those it regulates, the power it has to redress violations of law and on having a sufficient budget to carry out its responsibilities.
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