HBA-RBT H.B. 3461 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 3461
By: Madden
Elections
3/29/1999
Introduced



BACKGROUND AND PURPOSE 

Concerns have been raised about political campaign finance, resulting in
calls for reforms.  H.B. 3461 provides public access to all relevant
information regarding all individuals and organizations who give or spend
campaign dollars by requiring timely disclosure and electronic filing of
such contributions and expenditures. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Section 251.001, Election Code, by amending Subdivision
(13), and adding Subdivision (21), to redefine "specific-purpose committee"
and define "principal political committee of a candidate or officeholder." 

SECTION 2.  Amends Subchapter A, Chapter 251, Election Code, by adding
Section 251.010, as follows: 

Sec.  251.010.  PRINCIPAL POLITICAL COMMITTEE.  Requires a candidate or
officeholder to designate in writing a political committee to serve as the
person's principal political committee.  Provides that the designation must
be made within 15 days of the day the person becomes a candidate or
officeholder and must be filed with the proper authority. Prohibits a
candidate or officeholder from having more than one principal political
committee at a time.  Prohibits a person who is both a candidate and an
officeholder from having more than one principal political committee.
Provides that a candidate who becomes an officeholder is not required to
designate a new principal political committee.  Provides that a prohibition
imposed on a candidate or officeholder by this title applies to the
principal political committee of a candidate or officeholder.  Prohibits a
person from establishing a specific-purpose committee for supporting or
opposing only one candidate or assisting only one officeholder. 

SECTION 3.  Amends Sections 252.001, 252.0031, 252.0032, 252.005, and
252.006, Election Code, as follows: 

Sec.  252.001.  APPOINTMENT OF CAMPAIGN TREASURER REQUIRED.  Deletes
requirement that a candidate appoint a campaign treasurer. 

Sec.  252.0031.  CONTENTS OF APPOINTMENT BY SPECIFIC-PURPOSE COMMITTEE.
Deletes the provision that a specific-purpose committee for supporting a
candidate for specified offices must include the candidate's name.  Makes
conforming and nonsubstantive changes. 

Sec.  252.0032.  New title:  CONTENTS OF APPOINTMENT BY PRINCIPAL POLITICAL
COMMITTEE.  Makes conforming and nonsubstantive changes. 

 Sec.  252.005.  New title: AUTHORITY WITH WHOM APPOINTMENT FILED:
PRINCIPAL POLITICAL COMMITTEE.  Makes conforming and nonsubstantive
changes. 

Sec.  252.006.  New title: AUTHORITY WITH WHOM APPOINTMENT FILED:
SPECIFIC-PURPOSE COMMITTEE FOR SUPPORTING OR OPPOSING CANDIDATE OR
ASSISTING OFFICEHOLDERS.  Makes conforming and nonsubstantive changes. 

SECTION 4.  Amends Section 252.010(a), Election Code, to make a conforming
change. 

SECTION 5.  Amends Section 252.015(a), Election Code, to make conforming
and nonsubstantive changes. 

SECTION 6.  Amends Section 253.002(b), Election Code, to delete the
provision that exempts a candidate making or authorizing an expenditure for
the candidate's own election from the application of this section.  Makes
conforming changes. 

SECTION 7.  Amends Section 253.031, Election Code, to prohibit a candidate
or officeholder from accepting a campaign contribution or making a campaign
expenditure at a time when a campaign treasurer appointment for the
principal political committee is not in effect.  Deletes a provision which
exempts an out-of-state political committee from the application of this
Section.  Makes conforming changes. 

SECTION 8.  Amends Subchapter B, Chapter 253, Election Code, by adding
Sections 253.0311 and 253.0312, as follows: 

Sec.  253.0311.  ACCEPTANCE OF POLITICAL CONTRIBUTION BY CANDIDATE OR
OFFICEHOLDER.  Prohibits a candidate or officeholder from accepting a
political contribution in connection with the person's own candidacy or
office.  Authorizes a candidate or officeholder to accept a political
contribution on behalf of the person's principal political committee unless
the committee itself would be prohibited form accepting the contribution.
Provides that it is a Class A misdemeanor to violate this Section. 

Sec.  253.0312.  CONTRIBUTION OR EXPENDITURE BY CANDIDATE OR OFFICEHOLDER
FROM PERSONAL FUNDS.  Prohibits a candidate or officeholder from making a
political contribution or political expenditure from the person's personal
funds in connection with the persons's own candidacy or office.  Authorizes
a candidate or officeholder to make a political contribution from the
person's personal funds to the person's principal political committee.
Provides that it is a Class A misdemeanor to violate this Section. 

SECTION 9.  Amend Section 253.033(a), Election Code, to make conforming
changes. 

SECTION 10.  Amends Sections 253.034(a)-(c), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 11.  Amends Sections 253.035(b), (g), and (h), Election Code, to
make conforming and nonsubstantive changes. 

SECTION 12.  Amends Section 253.037(c), Election Code, to replace a
reference to the Federal Election Campaign Act with a reference to 2 U.S.C.
Section 431 and its subsequent amendments. Deletes an exception. 

SECTION 13.  Amends Section 253.038(a), Election Code, to include a
principal political committee among those entities prohibited from making
or authorizing a payment from a political contribution to purchase real
property or to pay the interest on or the principal of a note for the
purchase of real property. 

SECTION 14.  Amends Section 253.041(a), Election Code, to include a
principal political committee among those entities prohibited from making
or authorizing a payment from a political  contribution if the payment was
made for personal services rendered by the candidate or officeholder or by
the spouse or dependent child of the candidate or officeholder to a
business in which the candidate or officeholder has a specified interest,
or to the candidate or officeholder or the spouse or dependent child of the
candidate or officeholder. 

SECTION 15.  Amends Sections 253.042(a), (b), and (e), Election Code, to
make conforming and nonsubstantive changes. 

SECTION 16.  Amends Sections 253.091 and 253.092, Election Code, as follows:

Sec.  253.091.  CORPORATION COVERED.  Provides a citation to the Texas
Non-Profit Corporation Act and include the Texas Miscellaneous Corporation
Laws Act among the listed statutes. 

Sec.  253.092.  TREATMENT OF INCORPORATED POLITICAL COMMITTEE.  Creates
Subsection (a) from existing text.  Provides that a political committee
that has as its only principal purpose accepting political contributions
and making political expenditures is not considered to be a corporation
under this subchapter if the committee is formed for the express purpose of
promoting political ideas and does not engage in business activities, has
no shareholders or other affiliated persons who have a claim to the
corporation's assets or earnings, and is not established by a business
corporation or a labor organization and has adopted a policy under which
the corporation does not accept contributions from business corporations or
labor organizations. 

SECTION 17.  Amends Subchapter D, Chapter 253, Election Code, by adding
Section 253.0931, as follows: 

Sec.  253.0931.  CERTAIN LIMITED LIABILITY ENTITIES COVERED.  Provides that
limited partnerships and limited liability companies are considered to be
corporations under this subchapter and that their members are considered to
be stockholders. 

SECTION 18.  Amends Section 253.131, Election Code, by amending the heading
and Subsections (b) and (c), as follows: 

Sec.  253.131.  New title:  LIABILITY TO PRINCIPAL POLITICAL COMMITTEES.
Makes conforming changes. 

SECTION 19.  Amends Section 253.153(a) and (c), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 20.  Amends Section 253.154(a), Election Code, make conforming and
nonsubstantive changes. 

SECTION 21.  Amends Section 253.1541(b), Election Code, to make a
conforming change. 

SECTION 22.  Amends Section 253.155(a), Election Code, to make a conforming
change. 

SECTION 23.  Amends and reenacts Sections 253.157(a)-(c), Election Code, to
include a law firm among those entities that are prohibited from making a
political contribution in excess of $100 to the principal political
committee of a judicial candidate or officeholder and to make conforming
and nonsubstantive changes. 

SECTION 24.  Amends Sections 253.160(a) and (b), Election Code, to make
conforming changes. 

SECTION 25.  Amends Section 253.1601, Election Code, as follows:

Sec.  253.1601.  New title:  CONTRIBUTION TO CERTAIN COMMITTEES CONSIDERED
CONTRIBUTION TO PRINCIPAL POLITICAL COMMITTEE.  Makes conforming and
nonsubstantive changes. 
 
SECTION 26.  Amends Sections 253.161(a)-(c), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 27.  Amends Sections 253.1611(a)-(d), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 28.  Amends Section 253.162, Election Code, to make conforming and
nonsubstantive changes.  

SECTION 29.  Amends Sections 253.163(a), (b), and (d), Election Code, to
make conforming and nonsubstantive changes.  

SECTION 30.  Amends Sections 253.164(a)-(c), Election Code, to make
conforming and nonsubstantive changes.  

SECTION 31.  Sections 253.165(a), (b), and (e), Election Code, to make
conforming and nonsubstantive changes.  

SECTION 32.  Amends Sections 253.168(a), Election Code, to make a
conforming change.  

SECTION 33.  Amends Sections 253.169, Election Code, to make conforming and
nonsubstantive changes.  

SECTION 34.  Amends Sections 253.170(a) and (b), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 35.  Amends Section 253.171(a), Election Code, to make conforming
and nonsubstantive changes. 

SECTION 36.  Amends Sections 253.172(a), Election Code, to make conforming
and nonsubstantive changes.  

SECTION 37.  Amends the heading to Subchapter A, Chapter 254, Election
Code, as follows: 

SUBCHAPTER A.  RECORD KEEPING; GENERAL PROVISIONS

SECTION 38.  Amends Section 254.001, Election Code, to delete existing text
to make a conforming change.  Redesignates Subsections (b)-(e) to
Subsections (a)-(d), respectively. 

SECTION 39.  Amends Subchapter A, Chapter 254, Election Code, by adding
Section 254.002, as follows: 

Sec.  254.002.  SUBSTANTIAL INTEREST IN BUSINESS ENTITY.  Defines "business
entity."  Sets forth the circumstances which constitute a substantial
interest in a business entity. 

SECTION 40.  Amends Section 254.031(a), Election Code, to increase from $50
to $100 the amount of political contributions, loans, and expenditures that
must be filed in a report.  Provides that each report must contain the
difference between the sum of all money in account maintained at financial
institutions by the committee required to file the report, the amount of
political contribution received by the committee but not deposited in an
account, and cash on hand, and each outstanding check or other withdrawal
against an account at a financial institution as of the last day of the
reporting period.  Makes conforming and nonsubstantive changes. 

SECTION 41.  Amends Subchapter B, Chapter 254, Election Code, by adding
Sections 254.0312 and 254.0313, as follows: 

Sec.  254.0312.  REPORTING BY OUT-OF-STATE POLITICAL COMMITTEE.  Sets forth
the information that each report filed under this chapter by an
out-of-state political committee must include. 

Sec.  254.0313.  USE OF FICTITIOUS CONTRIBUTORS.  (a) Authorizes a
political committee to report political contributions as received from
fictitious contributors to permit the committee to determine whether
information regarding the committee's contributors is being used in
violation of Section 254.0401.   

(b) Authorizes a political committee to list not more than 10 fictitious
names that do not represent the names of actual contributors to the
committee on each report filed. 

(c) Requires a political committee that uses fictitious names to subtract
the total dollar amount of the fictitious contributions from the total
amount of contributions listed under Section 254.031(a)(5) or 254.0312(3). 

(d) Prohibits the principal political committee of a candidate or
officeholder or a specificpurpose committee from attributing more than
$1,000 in contributions to the same fictitious contributor in any calendar
year.  Prohibits a general-purpose committee from attributing more than
$5,000 in contributions to the same fictitious contributor in any calendar
year. 

(e) Requires a political committee that uses fictitious contributors to
send a list of the fictitious contributors under separate cover directly to
the authority with whom the committee's campaign treasurer appointment is
required to be filed by the time any report containing the fictitious names
is filed.  Requires the authority to maintain the list but to exclude it
from the public record.  Provides that a list submitted under this section
is excepted from the requirements of Section 552.021 (Availability of
Public Information), Government Code. 

(f) Prohibits a political committee from using fictitious contributors to
circumvent a reporting requirement or a limitation or prohibition
prescribed by this title. 

SECTION 42.  Amends Sections 254.034(a) and (d), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 43.  Amends Section 254.036, Election Code, as follows: (a) Sets
forth the requirements of a report filed under this chapter with an
authority other than the Texas Ethics Commission (commission). 

(b) Provides that each report filed with the commission under this chapter
must be filed by direct electronic transfer to the commission using
computer software provided by the commission except as provided in
Subsections (c), (e), or (f). 

(c) Sets forth the circumstances in which a political committee is
authorized to file a report under Subsections (a) and (b). 

(d) Sets forth the circumstances in which a political committee is entitled
to file a report under Subsection (c). 

(e) Authorizes specific committees to file reports that comply with
Subsection (a). 

(f) Authorizes an individual required to file a report with the commission
in connection with a  direct campaign expenditure to which Section 253.062
applies to file a report that complies with Subsection (a). 

(g) Provides that a report filed under this chapter is considered to be
under oath by the person required to file the report and a violation is
subject to prosecution regardless of the absence of or a defect in the
affidavit. 

 (h) Redesignated from Subsection (c).

(i) Redesignated from Subsection (d).

(j) Redesignated from Subsection (g).

SECTION 44.  Amends Section 254.038, Election Code, as follows:

Sec.  254.038.  New title:  ADDITIONAL REPORTS BY CERTAIN POLITICAL
COMMITTEES.  Requires specified persons to file additional reports during
the period beginning the ninth day before election day and ending at 12
noon on the second day before election day.  Requires a report filed under
this section to be filed electronically unless the person filing the report
is permitted to file reports that comply with Section 254.036(a). Makes
conforming and nonsubstantive changes. 

SECTION 45.  Amends Subchapter B, Chapter 254, Election Code, by adding
Section 254.0381, as follows: 

Sec.  254.0381.  ADDITIONAL REPORT OF CERTAIN CONTRIBUTIONS.  Requires a
political committee that accepts a political contribution of $5,000 or more
to file a report not later than 24 hours after the contribution is
accepted.  Sets forth the required contents of the report and the required
filing procedure. 

SECTION 46.  Amends Section 254.0391(a), Election Code, to make conforming
and nonsubstantive changes.  

SECTION 47.  Amends Section 254.041(c), Election Code, to make conforming
and nonsubstantive changes. 

SECTION 48.  Amends Section 254.042(a), Election Code, to delete a
reference to filing a report via telegram.  Deletes existing text to make a
conforming change. 

SECTION 49.  Amends Subchapter C, Chapter 254, Election Code, as follows:

New title: Subchapter C.  REPORTING BY PRINCIPAL POLITICAL COMMITTEE OF
CANDIDATE OR OFFICEHOLDER 

Sec.  254.061.  ADDITIONAL CONTENTS OF REPORTS.  Provides that the report
by a principal committee of a candidate or officeholder include the
identification and amount of any executory contract between a person making
political contributions over $5,000, or between a business entity in which
a person has a substantial interest, and specified entities. 

Sec.  254.0611.  New title:  ADDITIONAL CONTENTS OF REPORTS BY PRINCIPAL
POLITICAL COMMITTEE OF CERTAIN JUDICIAL CANDIDATES AND OFFICEHOLDERS.
Makes conforming and nonsubstantive changes. 

Sec.  254.062.  New title: SEMIANNUAL REPORTING SCHEDULE FOR PRINCIPAL
POLITICAL COMMITTEE.  Makes conforming and nonsubstantive changes. 

Sec.  254.063.   New title: ADDITIONAL REPORTS OF PRINCIPAL POLITICAL
COMMITTEE OF OPPOSED CANDIDATE.  Makes conforming and nonsubstantive
changes.  

Sec.  254.064.  FINAL REPORT. Makes conforming and nonsubstantive changes.

Sec.  254.065.  AUTHORITY WITH WHOM REPORTS FILED.  Makes conforming and
nonsubstantive changes. 

SECTION 50.  Amends Section 254.121, Election Code, to provide that the
report by a campaign  treasurer of a specific-purpose committee of a
candidate or officeholder include the identification and amount of any
executory contract between a person making political contribution over
$5,000, and a business entity in which a person has a substantial interest. 

SECTION 51.  Amends Section 254.126(a), Election Code, to make a conforming
change.  

SECTION 52.  Amends Section 254.128(a), Election Code, to make a conforming
change. 

SECTION 53.  Amends Section 254.151, Election Code, to require each report
by the campaign treasurer of a general-purpose committee to include the
amount of political contributions from a corporation or labor organization
under Section 253.100 that exceeds $100 and that are accepted during the
reporting period by the committee, the full name and address of the
corporation or labor organization making the contributions and the dates of
the contributions.  Makes conforming and nonsubstantive changes. 

SECTION 54.  Amends Subchapter F, Chapter 254, Election Code, by adding
Section 254.1511, as follows: 

Sec.  254.1511.  REPORTS BY PRINCIPAL POLITICAL COMMITTEE OF POLITICAL
PARTY; ADDITIONAL CONTENTS.  Provides that each semiannual report by the
principal political committee of the state executive committee of a
political party must list the political contributions and political
expenditures made in connection with each candidate or officeholder.
Provides that the total amount of political contributions made during the
calendar year to the principal political committee of the candidate or
officeholder or to another political committee on behalf of the candidate
or officeholder and the total amount of political expenditures made during
the calendar year for the benefit of the candidate or officeholder must be
included in each report by the principal political committee of the state
executive committee of a political party. 

SECTION 55.  Amends Section 254.181(a), Election Code, to make conforming
changes. 

SECTION 56.  Amends Section 254.182, Election Code, to make conforming and
nonsubstantive changes. 

SECTION 57.  Amends Sections 254.183(a), (b), and (d), Election Code, to
make conforming and nonsubstantive changes. 

SECTION 58.  Amends Section 254.184, Election Code, to make conforming
changes. 

SECTION 59.  Amends Section 254.201, Election Code, to require a person who
is a former officeholder or an unsuccessful candidate who has unexpended
political contributions after the person's principal political committee
files the last report required to be filed by subchapter C to file an
annual report for each year in which the person retains unexpended
contributions. 

SECTION 60.  Amends Section 254.203(a), Election Code, to make a conforming
change. 

SECTION 61.  Amends Sections 254.204(a) and (d), Election Code, to make
conforming and nonsubstantive changes. 

SECTION 62.  Amends Section 254.231(b), Election Code, to make a conforming
change. 

SECTION 63.  Repealer: Sections 251.005 (Expenditure From Unlawful
Contribution), 253.032 (Limitation on Contribution by Out-of-State
Committee), 253.036 (Officeholder Contributions Used in Connection With
Campaign), 253.100(d) (Expenditures for General-Purpose Committee), and
254.039 (Telegram Report by Certain General-Purpose Committees), Election
Code, and Subchapter D (Reporting by Officeholder), Chapter 254, Election
Code. 

SECTION 64.  Effective date: September 1, 1999.

 SECTION 65.  Requires candidates and officeholders to designate a
principal political committee by September 15, 1999, if they are candidates
or officeholders on September 1, 1999.  Requires a person to transfer to
the committee each asset that the person holds in the person's capacity as
a candidate or officeholder within 15 days of designating a principal
political committee.  Requires the committee to assume each liability of
the person within 15 days of the designation. 

SECTION 66.  Makes application of this Act prospective.

SECTION 67.  Provides that to the extent of any conflict, this Act prevails
over another Act of the 76th Legislature, Regular Session, 1999, relating
to nonsubstantive additions and corrections in enacted codes. 

SECTION 68.  Emergency clause.