Citations Affected:
IC 3-9-4-16
; IC 3-9.5;
IC 3-10-1-19
; IC 3-11;
IC 3-14-1-3
;
IC 6-3-9.
Synopsis: Campaign finance. Establishes a system of public funding
for candidates for governor and the general assembly who agree to limit
contributions from private sources and expenditures to the public funds
allocated. Establishes the public election campaign fund to finance the
election campaigns of participating candidates. Makes an annual
appropriation of $5.25 million from the state general fund to the fund.
Establishes a voluntary program under which individuals may
designate $2 to the fund from the state general fund on their Indiana
income tax returns. Requires the auditor of state annually to transfer the
total amount designated by individuals on their income tax returns from
the state general fund to the fund. Provides that the tax liability of an
individual is not affected by a designation. Provides for civil remedies
and for imposition of civil and criminal penalties for violations of the
campaign finance law. Prohibits an individual who holds a state or a
legislative office from making certain mailings with public funds
unless the individual has publicly stated that the individual will not
seek reelection or election to certain other offices.
Effective: July 1, 2001.
January 23, 2001, read first time and referred to Committee on Legislative Apportionment
& Elections.
A BILL FOR AN ACT to amend the Indiana Code concerning
elections and to make an appropriation.
SECTION 1.
IC 3-9-4-16
IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2001]: Sec. 16. (a) In addition to any other
penalty imposed, a person who does any of the following is subject to
a civil penalty under this section:
(1) Fails to file with the election division a report in the manner
required under IC 3-9-5.
(2) Fails to file a statement of organization required under
IC 3-9-1.
(3) Is a committee or a member of a committee who disburses or
expends money or other property for any political purpose before
the money or other property has passed through the hands of the
treasurer of the committee.
(4) Makes a contribution other than to a committee subject to this
article or to a person authorized by law or a committee to receive
contributions on the committee's behalf.
(5) Is a corporation or labor organization that exceeds any of the
limitations on contributions prescribed by
IC 3-9-2-4.
the amount of the contribution in excess of the limit prescribed by
IC 3-9-2-4
, plus any investigative costs incurred and documented by
the election division.
(f) This subsection applies to a person who is subject to a civil
penalty under subsection (a)(11). If the commission determines that a
candidate or the candidate's committee has violated
IC 3-9-2-12
, the
commission shall assess a civil penalty equal to the greater of the
following, plus any investigative costs incurred and documented by the
election division:
(1) Two (2) times the amount of any contributions received.
(2) One thousand dollars ($1,000).
(g) All civil penalties collected under this section shall be deposited
with the treasurer of state in the campaign finance enforcement
account. public election campaign fund established by
IC 3-9.5-8-1.
(h) Proceedings of the commission under this section are subject to
IC 4-21.5.
SECTION 2. IC 3-9.5 IS ADDED TO THE INDIANA CODE AS A
NEW ARTICLE TO READ AS FOLLOWS [EFFECTIVE JULY 1,
2001]:
ARTICLE 9.5. PUBLICLY FUNDED ELECTION
CAMPAIGNS
Chapter 1. Application
Sec. 1. (a) Except as provided in subsection (b), this article
applies only to the following:
(1) A candidate for governor.
(2) A candidate for a legislative office.
(b)
IC 3-9.5-4-11
applies to an individual who holds a state
office.
Sec. 2. To the extent not inconsistent with this article, IC 3-9
applies to a candidate covered by this article.
Chapter 2. Definitions
Sec. 1. The definitions in this chapter apply throughout this
article.
Sec. 2. "CPI" refers to the United States Bureau of Labor
Statistics Consumer Price Index for Indiana, all items, all urban
consumers, or its successor index.
Sec. 3. "Excess expenditure amount" means the amount of
money spent or obligated to be spent by a nonparticipating
candidate in excess of public election campaign funds allocated to
participating candidates for the same office.
Sec. 4. (a) "Express advocacy" means a communication that is
made through a broadcast medium, newspaper, magazine,
billboard, direct mail, or similar type of general public
communication or political advertising that does either of the
following:
(1) The communication or advertising advocates the election
or defeat of a clearly identified candidate, including a
communication that contains words such as "vote for",
"re-elect", "support", "cast your ballot for", "(name of
candidate) for (name of office)", "(name of candidate) in
(year)", "vote against", "defeat", "reject", or similar words.
(2) The communication contains campaign slogans or
individual words that in context can have no reasonable
meaning other than to recommend the election or defeat of
one (1) or more clearly identified candidates.
(b) The term does not include any of the following:
(1) A news story, a commentary, or an editorial by a
broadcasting station, a newspaper, a magazine, or another
publication, but only if the person disseminating the news
story, commentary, or editorial is not owned by or affiliated
with a candidate or the candidate's committee.
(2) A regularly published newsletter or another
communication whose circulation is limited to:
(A) a person's members, employees, shareholders, other
affiliated individuals; and
(B) those who request or purchase the publication.
Sec. 5. "Fund" refers to the public election campaign fund
established by
IC 3-9.5-8-1.
Sec. 6. "General campaign period" refers to the period:
(1) beginning the day after primary election day; and
(2) ending on general election day.
Sec. 7. (a) "Independent expenditure" means an expenditure
made by a person other than a candidate or the candidate's
committee that is made:
(1) for a communication that contains express advocacy; and
(2) without the participation of, cooperation of, or the
coordination with the candidate or the candidate's committee.
(b) For purposes of this section, an expenditure is "coordinated"
if the expenditure is made:
(1) for a communication or anything of value to influence the
outcome of an election; and
(2) by a person:
(A) in cooperation, consultation, or concert with, a
candidate, a candidate's committee, or an agent acting on
behalf of a candidate or a candidate's committee, at the
request or suggestion of, or under a particular
understanding with a candidate, a candidate's committee,
or an agent acting on behalf of a candidate or a candidate's
committee;
(B) for the dissemination, distribution, or republication, in
whole or in part, of a broadcast or a written, graphic, or
other form of campaign material prepared by a candidate,
a candidate's committee, or an agent of a candidate or a
candidate's committee; and
(C) based on specific information about the candidate's
plans, projects, or needs provided to the person making the
payment by the candidate or the candidate's agent who
provides the information with the intention of having the
payment made.
(c) The following expenditures are not considered independent
expenditures:
(1) If the person making the expenditure, during the same
election cycle in which the expenditure is made, is serving or
has served as a member, employee, fundraiser, or agent of the
candidate's committee in an executive or policy making
position.
(2) If the person making the expenditure has:
(A) served in a formal policy or advisory position with the
candidate's campaign; or
(B) participated in strategic or policy making discussions
with the candidate's campaign relating to the candidate's
pursuit of nomination or election;
in the same election cycle as the election cycle in which the
expenditure is made.
(3) If the person making the expenditure:
(A) makes the expenditure for the professional services of
another person; and
(B) in a nonministerial capacity, has provided or is
providing campaign related services in the same election
cycle to a candidate who seeks nomination or election to
the same office as any of the candidates to whom the
communication refers.
Sec. 8. "Issue advertisement" means a communication made
through a broadcasting station, a newspaper, a magazine, an
outdoor advertising facility, a mailing, or another type of general
public political advertising that:
period:
(1) beginning one hundred eighty (180) days before the
primary election for that office; and
(2) ending thirty (30) days before the primary election.
Sec. 17. "Seed money contribution" refers to a contribution of
not more than one hundred dollars ($100) made by an adult
individual during the seed money period.
Sec. 18. "Seed money period" for an elected office refers to the
period:
(1) beginning the day following the previous general election
for that office; and
(2) ending on the last day of the qualifying period.
Chapter 3. Candidate Eligibility for Public Election Campaign
Funding
Sec. 1. A candidate becomes a participating candidate for the
primary campaign period when the candidate does all of the
following:
(1) Files a statement with the election division that the
candidate has complied, and will comply, with all of the
requirements of this article, including the requirement that
during the seed money period and the qualifying period, the
candidate will not accept or spend private contributions from
a source other than seed money contributions and qualifying
contributions.
(2) Meets the following qualifying contribution requirements
before the close of the qualifying period:
(A) Collects at least the following number of qualifying
contributions:
(i) Two thousand five hundred (2,500) qualifying
contributions for a candidate for governor.
(ii) One hundred fifty (150) qualifying contributions for
a candidate for state senator.
(iii) Fifty (50) qualifying contributions for a candidate
for state representative.
(B) Documents each qualifying contribution as required by
IC 3-9.5-4-2.
Sec. 2. (a) A party candidate qualifies as a participating
candidate for the general campaign period when the candidate
does all of the following:
(1) Is nominated by a political party at a primary election.
(2) Files a declaration with the election division that the
candidate has complied and will comply with all of the
requirements of this article.
(3) Is a participating candidate for the primary campaign
period.
(b) A candidate other than a party candidate qualifies as a
participating candidate for the general campaign period when the
candidate does all of the following:
(1) Before the primary election, meets all of the applicable
requirements of this article and files a declaration with the
election division that the candidate has fulfilled and will fulfill
all of the requirements of a participating candidate.
(2) During the primary campaign period, fulfills all the
requirements of a participating candidate under section 1 of
this chapter.
Sec. 3. (a) This section applies to a candidate seeking to become
a participating candidate.
(b) The only private contributions a candidate may accept
before the end of the qualifying period are the following:
(1) Qualifying contributions.
(2) Seed money contributions.
(c) A candidate and a candidate's spouse may not each make
more than a:
(1) seed money contribution to the candidate's campaign
during the seed money contribution period; and
(2) qualifying contribution to the candidate's campaign
during the qualifying period.
(d) The aggregate amount of seed money contributions accepted
by a candidate seeking to become a participating candidate may
not exceed the following:
(1) Fifty thousand dollars ($50,000) for a candidate for
governor.
(2) Two thousand ($2,000) for a candidate for state senator.
(3) One thousand ($1,000) for a candidate for state
representative.
(e) The election division shall adjust for inflation under section
7 of this chapter the maximum amount of seed money
contributions that a candidate may receive.
(f) Seed money:
(1) may be spent only during the qualifying period; and
(2) may not be spent during the primary campaign period or
the general campaign period.
Sec. 4. (a) A candidate who wants to become a participating
candidate shall do all of the following not later than forty-eight (48)
hours after the close of the qualifying period:
(1) Fully disclose all the following to the election division:
(A) Seed money contributions.
(B) Expenditures.
(2) Pay the election division all seed money the candidate
raised during the seed money period that exceeds the
aggregate seed money limit. The election division shall deposit
money received under this subdivision in the fund.
(3) Submit to the election division documentation concerning
the required number of qualifying contributions.
(4) Pay to the election division the total of all qualifying
contributions received by the candidate.
(5) Submit to the election division a declaration stating that
the candidate has complied with all other requirements for
the candidate to become a participating candidate.
(b) A candidate's application to become a participating
candidate must be signed by the candidate and the treasurer of the
candidate's committee under the penalties for perjury.
Sec. 5. (a) Not more than five (5) days after a candidate applies
to become a participating candidate, the election division shall
certify whether the candidate qualifies.
(b) A candidate may appeal an adverse decision of the election
division made under subsection (a) to the commission under
IC 4-21.5.
(c) A commission determination regarding a candidate's
qualification is considered a final order under IC 4-21.5.
Sec. 6. A candidate who accepts public election campaign funds
during the primary campaign period must comply with all the
requirements of this article throughout the general campaign
period regardless of whether the candidate later discontinues
acceptance of public election campaign funds.
Sec. 7. (a) After December 31, 2002, the election division shall,
before February 1 of each odd-numbered year, adjust the seed
money contribution limit that may be accepted by a candidate
under section 3 of this chapter under STEP SIX of the following
formula:
STEP ONE: Determine the percentage change between the
CPI as last reported in the previous calendar year and the
CPI as last reported in the previous odd-numbered year
before the previous calendar year.
STEP TWO: Express the percentage change determined in
STEP ONE as a three (3) digit decimal rounded to the nearest
thousandth.
STEP THREE: Add one (1) to the decimal determined under
STEP TWO.
STEP FOUR: Determine the limit for the particular office
currently in effect under this section.
STEP FIVE: Multiply the sum determined under STEP
THREE by the number determined under STEP FOUR.
STEP SIX: Round the product determined in STEP FIVE up
to the nearest even hundred dollars.
(b) The adjusted seed money contribution limit for a candidate
seeking to become a participating candidate is the amount
determined in STEP SIX of subsection (a).
(c) Beginning in 2003, the election division shall publish the
adjusted limits determined under this section in the February
edition of the Indiana Register in each odd-numbered year.
Chapter 4. Contributions and Expenditures
Sec. 1. During the primary campaign period and the general
campaign period a participating candidate may not accept private
contributions from any source other than the candidate's political
party as provided in section 10 of this chapter.
Sec. 2. (a) This section applies to qualifying contributions and
seed money contributions.
(b) A person making a qualifying contribution shall include all
of the following information with the contribution:
(1) The contributor's name.
(2) The contributor's home address.
(3) The contributor's telephone number.
(4) The name of the candidate on whose behalf the
contribution is made.
(5) A statement that the contributor:
(A) understands that the contribution:
(i) is made to help the candidate become a participating
candidate; and
(ii) will be paid to the election division; and
(B) makes the contribution without coercion or
reimbursement.
(6) The contributor's signature.
(c) A person making a seed money contribution shall include all
of the following information with the contribution:
(1) The contributor's printed name.
(2) The contributor's address.
(3) A statement that the contributor:
(A) understands the purpose of the contribution; and
(B) makes the contribution without coercion or
reimbursement.
(4) If the contribution is for at least twenty-five dollars ($25),
the following information:
(A) The contributor's ZIP code.
(B) The contributor's telephone number.
(C) The contributor's occupation.
(D) The name of the contributor's employer.
(5) The contributor's signature.
(d) A candidate or the candidate's committee may not accept a
contribution if the information required by this section is not
received.
(e) A candidate shall do the following with the information
required by this section:
(1) Give a copy to the individual making the contribution.
(2) Keep a copy for the candidate's records.
(3) Provide a copy to the election division as required by this
article or rules adopted under this article.
(f) A candidate may not receive a qualifying contribution or a
seed money contribution from a person other than from the person
identified by the information required by this section.
Sec. 3. (a) Whenever a candidate becomes a participating
candidate, but not earlier than the beginning of the primary
campaign period, the election division shall issue the following to
the candidate:
(1) A public election debit card with a debit line that entitles
the candidate and individuals authorized by the candidate to
draw money from an account established in the fund for the
candidate. The debit line may not exceed the amount of public
election campaign funds allocated to the candidate, minus the
amount of petty cash issued to the candidate under
subdivision (2).
(2) A warrant drawn on the fund for use as petty cash under
section 4 of this chapter in the amount of the following :
(A) Five thousand dollars ($5,000), if the participating
candidate is a candidate for governor.
(B) One thousand five hundred dollars ($1,500), if the
participating candidate is a candidate for a legislative
office.
(b) Except as provided in section 4 of this chapter, a
participating candidate and the candidate's committee shall pay all
campaign expenditures with the candidate's public election debit
card issued under this section.
(c) Upon application by a participating candidate and subject to
the rules of the commission, the election division may issue more
than one (1) public election debit card to the candidate.
Sec. 4. (a) A participating candidate and the candidate's
committee may pay campaign expenditures from a petty cash
account held by the candidate's committee and established with
money given to the candidate under section 3(a)(2) of this chapter.
(b) Petty cash expenditures may not exceed the following during
any day:
(1) Five hundred dollars ($500), if the participating candidate
is a candidate for governor.
(2) One hundred fifty dollars ($150), if the participating
candidate is a candidate for a legislative office.
(c) A participating candidate is entitled to reimbursement to the
candidate's petty cash account from the fund by submitting the
following information to the election division:
(1) The date of the expenditure.
(2) The amount of the expenditure.
(3) The purpose of the expenditure.
(4) A receipt documenting the expenditure.
(d) If a participating candidate submits the information under
subsection (c), the election division shall do the following within
five (5) working days after the date the election division receives
the information:
(1) Issue a warrant to the candidate's committee in the
amount of total petty cash expenditures documented under
subsection (c).
(2) Deduct the amount of the warrant from the participating
candidate's debit line under section 3 of this chapter.
Sec. 5. (a) During a primary campaign period, a participating
candidate may make expenditures using only public election
campaign funds allocated to the candidate for the primary
campaign period.
(b) During a general campaign period, a participating candidate
may make expenditures using only public election campaign funds
allocated to the candidate for the general campaign period.
Sec. 6. (a) A participating candidate is entitled to receive public
election campaign funds for the primary campaign period on the
date the election division (or the commission) certifies the
candidate as a participating candidate.
set by subsection (c).
(f) This article does not restrict a regular party committee from
spending committee funds for any of the following:
(1) Committee general operating expenses.
(2) Conventions.
(3) Nomination and endorsement of candidates.
(4) Identifying, researching, and developing the committee's
position on issues.
(5) Party platform activities.
(6) Voter registration activities that are unrelated to specific
participating candidates.
(7) Get out the vote drives that have no reference to a
participating candidate.
(8) Travel expenses for committee officers or employees who
are not participating candidates.
(9) Party development activities that are unrelated to a
participating candidate.
Sec. 11. (a) As used in this section, "mass mailing" refers to a
mailing of at least two hundred (200) identical or nearly identical
pieces of mail sent by an elected official to the voters, residents, or
postal box holders within the election district from which the
elected official is elected. The term includes substantially identical
letters, newsletters, pamphlets, brochures, or other written
material. The term does not include any of the following:
(1) A mailing made in direct response to communications
from persons or groups to whom the matter is mailed.
(2) A mailing to federal, state, or local government officials.
(3) News releases to the communications media.
(b) An individual who holds a state office or a legislative office
may not make a mass mailing paid for from public funds between
January 1 of an election year and the date of the general election
for the office unless the individual has made a public
announcement that the individual will not be a candidate for
reelection to:
(1) the office; or
(2) any other legislative or federal office;
during the election cycle.
Chapter 5. Allocation of Money to Participating Candidates
Sec. 1. The amount of public election campaign funds that a
participating party candidate is entitled to receive for the primary
campaign period is the following:
(1) In a contested primary election, seventy-five percent
(75%) of the average candidate expenditures for the last two
contested primary elections for the office in the election
district, adjusted for inflation as provided under section 5 of
this chapter.
(2) If the most recent primary election in an election district
was not contested, a participating candidate in a contested
primary election in that election district is entitled to receive
public election campaign funds equal to seventy-five percent
(75%) of the average candidate expenditure for the elected
office for the last two (2) contested primary elections on a
statewide basis, adjusted for inflation as provided under
section 5 of this chapter.
Sec. 2. The amount of public election campaign funds that a
participating candidate is entitled to receive for the general
campaign period is the following:
(1) In a contested general election, a participating candidate
is entitled to receive public election campaign funds for the
general campaign period equal to seventy-five (75%) of the
average candidate expenditure for the last two contested
general elections for that office in that election district,
adjusted for inflation as provided under section 5 of this
chapter.
(2) If the last general election in an election district was not
contested, a participating candidate in a contested general
election in that election district is entitled to receive public
election campaign funds equal to seventy-five percent (75%)
of the average candidate expenditure for the elected office for
the last two contested general elections on a statewide basis,
adjusted for inflation as provided under section 5 of this
chapter.
Sec. 3. Subject to section 4 of this chapter, a participating
candidate is entitled to receive additional public elections campaign
funds to match:
(1) an excess expenditure amount spent by a nonparticipating
candidate as provided in
IC 3-9.5-6-1
;
(2) an independent expenditure made in opposition to the
candidate or on behalf of an opposing candidate as provided
in
IC 3-9.5-6-2
; and
(3) the amount spent for any issue advertisements made in
opposition to the candidate or on behalf of an opposing
candidate as provided in
IC 3-9.5-6-3.
Sec. 4. The maximum aggregate amount of additional funding
a participating candidate may receive under section 3 of this
chapter is two (2) times the full amount of public election campaign
funds allocated to the participating candidate for the particular
primary or general campaign period.
Sec. 5. (a) The election division shall adjust expenditure
amounts for inflation under subsection (b) before it computes
average expenditure amounts under section 1 or 2 of this chapter.
(b) The election division shall adjust expenditures for inflation
under sections 1 and 2 of this chapter under STEP SIX of the
following formula:
STEP ONE: Determine the expenditure amount for the
relevant year.
STEP TWO: Determine the percentage change between the
CPI as last reported in the relevant year and the CPI as most
recently reported.
STEP THREE: Express the percentage change determined in
STEP TWO as a three (3) digit decimal rounded to the nearest
thousandth.
STEP FOUR: Add one (1) to the decimal determined under
STEP THREE.
STEP FIVE: Multiply the sum determined under STEP
FOUR by the expenditure amount determined under STEP
ONE:
STEP SIX: Round the product determined under STEP FIVE
to the nearest thousand dollar amount.
(c) The election division shall determine average candidate
expenditures under section 1 or 2 of this chapter by using the
amount determined under STEP SIX of subsection (b).
Chapter 6. Independent Expenditures, Excess Expenditures of
Nonparticipating Candidates, and Issue Advertisement
Expenditures
Sec. 1. (a) If a nonparticipating candidate's total expenditures
exceed the amount of public election campaign funds allocated to
the candidate's opponents who are participating candidates, the
nonparticipating candidate shall report to the election division the
nonparticipating candidate's excess expenditures as follows:
(1) Except as provided in subdivision (2), each expenditure
amount that, in the aggregate, is more than one thousand
dollars ($1,000) must be reported within forty-eight (48)
hours of when the expenditure is made or is obligated to be
made.
(2) If an expenditure is made during the last twenty (20) days
before the end of the relevant campaign period, each
expenditure amount that, in the aggregate, is more than five
hundred dollars ($500) must be reported within twenty-four
(24) hours of when the expenditure is made or is obligated to
be made.
(b) Upon receiving a report under subsection (a), the election
division shall, subject to
IC 3-9.5-5-4
, immediately increase the
debit line of each opposing participating candidate by an amount
equal to the excess expenditure amount the nonparticipating
candidate has spent or intends to spend.
Sec. 2. (a) A person who makes or is obligated to make
independent expenditures during a primary or general campaign
period shall report the expenditures to the election division as
follows:
(1) If the independent expenditures, in the aggregate, exceed
one thousand dollars ($1,000), the person shall report each
expenditure to the election division within forty-eight (48)
hours after making or becoming obligated to make the
expenditure.
(2) If an independent expenditure is made during the last
twenty (20) days before the end of the relevant campaign
period and if independent expenditures made by the person,
in the aggregate exceed five hundred dollars ($500), the
person shall report each expenditure within twenty-four (24)
hours after making or becoming obligated to make the
expenditure.
(b) Upon receiving a report under subsection (a), the election
division shall, subject to
IC 3-9.5-5-4
, immediately increase the
debit line of each participating candidate in opposition to whom the
independent expenditure is made in an amount equal to the amount
of the independent expenditure.
Sec. 3. (a) A person that makes or is obligated to make an
expenditure to purchase an issue advertisement shall file a report
with the election division not later than forty-eight (48) hours after
making or becoming obligated to make the expenditure.
(b) The report required by subsection (a) must contain the
following information:
(1) The name and address of the person making the
expenditure.
(2) The amount of the expenditure.
(3) The purpose of the issue advertisement.
(c) Upon:
accrues from these investments shall be deposited in the fund.
Sec. 6. Money in the fund at the end of a state fiscal year does
not revert to the state general fund.
Sec. 7. There is annually appropriated to the fund from the state
general fund five million, two hundred fifty thousand dollars
($5,250,000) beginning July 1.
SECTION 3.
IC 3-10-1-19
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2001]: Sec. 19. (a) The ballot for
a primary election shall be printed in substantially the following form
for all the offices for which candidates have qualified under IC 3-8:
this act, by an individual or a husband and wife with respect to income tax returns for taxable years that begin after December 31, 2000, and income tax returns filed after December 31, 2001.