AGO 1973 No. 14 - Jun 8 1973
INITIATIVE NO. 276 ‑- ELECTIONS ‑- REGULATION OF CAMPAIGN CONTRIBUTIONS AND EXPENDITURES
Elections to which Initiative No. 276 is applicable; meaning of terms; restrictions upon anonymous contributions; reporting requirements for candidates and political committees; reporting requirements for commercial advertisers; procedures for obtaining relief from reporting requirements; use of public facilities in electoral campaigns.
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June 8, 1973
Honorable Arthur C. Brown
State Representative, First District
16020 Densmore North
Seattle, Washington 98133
Cite as: AGO 1973 No. 14
This is written in response to your recent request for a resume of Initiative No. 276, insofar as this new law regulates the conduct of electoral campaigns and imposes various reporting requirements upon candidates and organizations involved in such campaigns. We shall set forth the questions raised by this request along with our answers thereto within the body of this opinion for ease of reference.
Initiative No. 276 was adopted by the voters of this state at the November 7, 1972, general election1/ and became effective on January 1, 1973.2/ It has since been codified as chapter 42.17 RCW and, consequently, we will hereinafter cite its provisions by their code designations in accordance with customary practice.
[[Orig. Op. Page 2]]
The questions here to be considered relate mainly to the first major segment of the initiative, denominated Chapter I and now codified as RCW 42.17.030 ‑ 42.17.140, which regulates the financing of electoral campaigns and requires certain detailed reports of campaign contributions and expenditures by "candidates" for most public offices and by "political committees" involved in election campaigns. We shall indicate the definitions of both of these terms in responding to specific questions below.3/ Also to be noted is Chapter III, a single section segment of the initiative presently codified as RCW 42.17.240, which requires most candidates for elective offices as well as persons holding those offices to make detailed public disclosures with respect to their personal financial interests. And, thirdly, we will have occasion to look, as well, at certain regulations implementing both of these chapters which have been adopted by the Public Disclosure Commission under the authority vested in that body by §§ 36 and 37 of the initiative (RCW 42.17.360 and 42.17.370).
The Public Disclosure Commission, simply referred to as the commission in a number of the sections of the initiative to be quoted in this resume, is a five‑member body appointed by the governor in accordance with § 35 (RCW 42.17.350) to administer all of the provisions of this new disclosure law.4/ Because its powers in this regard include the promulgation of both interpretive and implementing regulations on an on-going basis it will, of course, be necessary for all candidates and political committees affected by this general segment of the initiative to look beyond the four corners of this opinion in order to keep abreast of any changes in the reporting or other requirements described herein which may, from time to time, be caused by such regulations as are adopted after its issuance. We mayof necessity speak only to the law (including the commission's regulations) as it presently stands in responding to the questions raised by your request.
In this connection we would finally note, before turning to these questions, the present status of certain pending [[Orig. Op. Page 3]] litigation relating to the constitutionality of various portions of Initiative No. 276. Late last week5/ the Thurston County Superior Court issued its decision in four cases that had earlier been jointly tried before the Honorable Frank Baker of that court in which constitutional challenges were lodged against the initiative by a group of present elected officials,6/ a representative of lobbyists,7/ a "grass roots" lobbying organization,8/ and a campaign worker in a school district special levy campaign.9/ In it the court rejected most of these challenges but held three sections of the initiative to be violative, primarily, of the guarantees of free speech and assembly which are contained in the First Amendment to the United States Constitution, and a part of a fourth section to be in contravention of certain unspecified constitutional rights of persons charged with violating the initiative. The sections thus ruled upon are §§ 14, 18, 20 and 40 (4), codified, respectively, as RCW 42.17.140, 42.17.180, 42.17.200, and 42.17.400 (4), and dealing with the amounts which may be expended in electoral campaigns, the reports required from employers of lobbyists, the conduct of "grass roots" lobbying campaigns, and the enforcement of the initiative by private citizens.
While it is certain that this ruling will be appealed to the state supreme court, these several affected sections of the initiative will, in the meantime, be inoperative. Accordingly, limiting ourselves in this opinion to the "law as it presently stands," we will refrain at this time from passing upon any questions pertaining to these sections ‑ only one of which (RCW 42.17.140) has anything to do with the subject matter of this request in any event.
We turn now to your questions.
We begin by responding to your basic, threshold inquiry; namely, to what election campaigns does Chapter I of Initiative No. 276 apply.
[[Orig. Op. Page 4]]
Chapter I of the initiative contains a total of twelve sections (§§ 3-14) which have been codified as RCW 42.17.030-42.17.140. The answer to this initial question is primarily to be found in the first of these sections, RCW 42.17.030, which states that:
"The provisions of this act relating to election campaigns shall apply in all election campaigns other than (a) for precinct committeeman; (b) for the President and Vice President of the United States; and (c) for an office the constituency of which does not encompass a whole county and which contains less than five thousand registered voters as of the date of the most recent general election in such district."
Under § 37 of the initiative (RCW 42.17.370), however, it is provided that the Public Disclosure Commission may, interalia,
". . .
"(7) Relieve, by published regulation of general applicability, candidates or political committees of obligations to comply with the provisions of this act relating to election campaigns, if they have not received contributions nor made expenditures in connection with any election campaign of more than one thousand dollars; . . ."
In accordance with this authorization the commission late last month adopted WAC 390-04-200 which provides as follows:
"No candidate and no political committee, as those terms are defined in § 2 of Initiative 276, shall be required to comply with the provisions of §§ 4-9 of said act in any election campaign for public office in which neither the aggregate contributions nor the aggregate expenditures on behalf of such candidate exceed $1,000, and no single contribution within such aggregate exceeds $100. The term 'aggregate' as used in this regulation, means a total of all contributions [[Orig. Op. Page 5]] received or expenditures made by the candidate together with all contributions received and all expenditures made by all political committees formed by or with the express or implied knowledge or consent of such candidate in connection with such campaign."
Similarly, by WAC 390-04-210 the commission has provided that:
"No political committee, as that term is defined in § 2 of Initiative 276, shall be required to comply with the provisions of §§ 4-9 of said act in connection with any ballot proposition in which neither the aggregate contributions nor the aggregate expenditures exceed $1,000, and no single contribution within such aggregate exceeds $100. The term 'aggregate,' as used in this regulation, means the total of all contributions received or all expenditures made by such committee together with those of all political committees working in conjunction or in cooperation with each other in any manner on the same side of any ballot proposition."10/
[[Orig. Op. Page 6]]
Reading these regulations along with the text of RCW 42.17.030,supra, the total answer to your first question is thus as follows:
(a)Campaigns for Elective Office:
Chapter I of Initiative No. 276 applies to all campaigns in support of or in opposition to a candidate for election to public office with the following three statutory exceptions:
(1) Campaigns for precinct committeemen;
(2) Campaigns for the office of President and Vice‑President of the United States; and
(3) Campaigns for public office where the constituency which elects the individual to fill the office does not encompass a whole county and contains fewer than 5,000 registered voters as of the date of the most recent general election.
(b)Campaigns with Respect to Ballot Propositions:
In the case of ballot propositions this chapter of the initiative applies even in the case of less than county-wide constituencies containing less than 5,000 registered voters (e.g., the traditional school district special levy election) for the reason that subpart (c) of RCW 42.17.030, supra, excludes only campaigns for office in such small constituencies. Accord, AGO 1973 No. 5, written to State Representative Wayne Ehlers earlier this year.
However, in the case of both of these two categories of elections, an exemption from §§ 4-9only (i.e., RCW 42.17.040-42.17.090, all of which will be referred to in some detail later in this opinion) may be obtained in those instances where the amounts of contributions and expenditures involved fall below the limits set forth in the disclosure commission's [[Orig. Op. Page 7]] regulations quoted on pp. 4 and 5, above.
Related to this opening question of the election campaigns to which Chapter I of the initiative applies is that of the relationship between this state law and either of the following:
(a) Such local, county or city ordinances or charter provisions as may also be in effect and apply to local races in such municipalities;
(b) The recently adopted "Federal Election Campaign Act of 1971" ‑ Public Law 92-225.
We have heretofore considered the first of these two potential relationships. In AGLO 1973 No. 47, written to State Representative Jeff Douthwaite, we stated that:
". . . our review of the initiative reveals nothing whatsoever contained therein which purports, in any way, to exempt a campaign for elective office from its provisions solely by reason of the fact that the activities of persons campaigning for that office are also regulated by a local, municipal ordinance or charter provision such as the Seattle city ordinance described in your letter. Accordingly, since that city also obviously constitutes a constituency having 5,000 or more registered voters, it is our opinion that all candidates for its elective offices are required to comply with all of the reporting requirements of §§ 3-14 and 24 of Initiative No. 276 even though they may, in addition, also be required to make certain reports under the provisions of this city ordinance."
As for the above cited federal act (which overlaps with Initiative No. 276 only insofar as both of these laws have application to campaigns for the positions of United States Senator or Representative from the state of Washington)11/ the relationship between it and the initiative is covered by [[Orig. Op. Page 8]] the following provisions of § 403 of the federal act:
"(a) Nothing in this Act shall be deemed to invalidate or make inapplicable any provision of any State law, except where compliance with such provision of law would result in a violation of a provision of this Act.
"(b) Notwithstanding subsection (a), no provision of State law shall be construed to prohibit any person from taking any action authorized by this Act or from making any expenditure (as such term is defined in section 301 (f) of this Act) which he could lawfully make under this Act."
The thrust of the first subpart of this section is to excuse a candidate for federal elective office from any need to comply with Initiative No. 276 if, but only if, his compliance with a particular requirement of this state measure would result in a violation of the federal law. Subpart (b) then qualifies this conclusion to the extent of saying (as applied to the present case) that nothing in this state law will be construed to prohibit a candidate for federal elective office or any person connected with his campaign from taking any action authorized by the federal act or making any expenditure which is lawful thereunder.12/
When is a person deemed to have become a "candidate" for the purposes of Chapter I of the initiative?
Section 2 (5), a part of the definitions section of the initiative now codified as RCW 42.17.020, answers this question as follows:
". . .
"(5) 'Candidate' means any individual who seeks election to public office. An individual shall be deemed to seek election [[Orig. Op. Page 9]] when he first:
"(a) Receives contributions or makes expenditures or reserves space or facilities with intent to promote his candidacy for office; or
"(b) Announces publicly or files for office."
If an elected official or other individual receives and retains an unsolicited contribution, does he thereby become a "candidate"?
The receipt of an unsolicited contribution will not, of itself, cause the individual to become a candidate. However, retention of such a contribution with an intent to promote his candidacy for office in the future would cause him to be deemed a candidate within the meaning of this term as above defined.
What restrictions does the initiative place upon the receipt and use of anonymous contributions?
RCW 42.17.060 (3) provides that:
"(3) (a) Accumulated anonymous contributions in excess of one dollar from any individual contributor, and
"(b) Accumulated anonymous contributions in excess of one per cent of the total accumulated contributions received to date or three hundred dollars (whichever is less), shall not be deposited, used or expended, but shall be returned to the donor, if his identity can be ascertained. If the donor cannot be ascertained, the contribution shall escheat to the state, and shall be paid to the state treasurer for deposit in the state general fund."
[[Orig. Op. Page 10]]
Upon becoming a "candidate" as above defined, what initial reports are required to be filed by an individual?
At this point a distinction must be drawn between the act of becoming a candidate as defined in RCW 42.17.020 (5), supra, and that of publicly announcing or filing as such. Of course, it is possible for all of these actions to occur simultaneously but, on the other hand ‑ particularly in view of the initiative's broad definition of this term ‑ it is more likely that they will not. Instead, as for example by receiving and retaining contributions with the intent thereby to promote his active candidacy for a certain office in the future, a person may well become a "candidate" in advance of his filing as such or even the making of anypublic announcement of his candidacy.
With this in mind we first turn to § 24 of the initiative (RCW 42.17.240) which, insofar as is here material, states that
". . . every candidate (except for the offices of President, Vice President and precinct committeeman) shall, within two weeks of becoming a candidate, file with the commission a written statement sworn as to its truth and accuracy stating for himself and his immediate family for the preceding twelve months:
"(a) Occupation, name of employer, and business address; and
"(b) Each direct financial interest in excess of five thousand dollars in a bank or savings account or cash surrender value of any insurance policy; each other direct financial interest in excess of five hundred dollars; and the name, address, nature of entity, nature and value of each such direct financial interest; and
"(c) The name and address of each creditor to whom the value of five hundred dollars or more was owed; the original amount of each debt to each such creditor; the amount of each debt owed to each creditor as of the date of filing; the terms of repayment of each such debts; and the security [[Orig. Op. Page 11]] given, if any, for each such debt: PROVIDED, that debts arising out of a 'retail installment transaction' as defined in chapter 63.14 R.C.W. (Retail Installment Sales Act) need not be reported; and
"(d) Every public or private office, directorship and position as trustee held; and
"(e) All persons for whom actual or proposed legislation, rules, rates, or standards has been prepared, promoted, or opposed for current or deferred compensation; the description of such actual or proposed legislation, rules, rates or standards; and the amount of current or deferred compensation paid or promised to be paid; and
"(f) The name and address of each governmental entity, corporation, partnership, joint venture, sole proprietorship, association, union, or other business or commercial entity from whom compensation has been received in any form of a total value of five hundred dollars or more; the value of such compensation; and the consideration given or performed in exchange for such compensation; and
"(g) The name of any corporation, partnership, joint venture, association, union or other entity in which is held any office, directorship or any general partnership interest, or an ownership interest of ten percent or more; the name or title of that office, directorship or partnership; the nature of ownership interest; and with respect to each such entity the name of each governmental entity, corporation, partnership, joint venture, sole proprietorship, association, union or other business or commercial entity from which such entity has received compensation in any form in the amount of five hundred dollars or more during the preceding twelve months and the consideration given or performed in exchange for such compensation; and
[[Orig. Op. Page 12]]
"(h) A list, including legal descriptions, of all real property in the State of Washington, the assessed valuation of which exceeds two thousand five hundred dollars in which any direct financial interest was acquired during the preceding calendar year, and a statement of the amount and nature of the financial interest and of the consideration given in exchange for such interest; and
"(i) A list, including legal descriptions, of all real property in the State of Washington, the assessed valuation of which exceeds two thousand five hundred dollars in which any direct financial interest was divested during the preceding calendar year, and a statement of the amount and nature of the consideration received in exchange for such interest, and the name and address of the person furnishing such consideration; and
"(j) A list, including legal descriptions, of all real property in the State of Washington, the assessed valuation of which exceeds two thousand five hundred dollars in which a direct financial interest was held: PROVIDED, that if a description of such property has been included in a report previously filed, such property may be listed, for purposes of this provision, by reference to such previously filed report; and
"(k) A list, including legal descriptions, of all real property in the State of Washington, the assessed valuation of which exceeds five thousand dollars, in which a corporation, partnership, firm, enterprise or other entity had a direct financial interest, in which corporation, partnership, firm or enterprise a ten percent or greater ownership interest was held; and
"(1) Such other information as the commission may deem necessary in order to properly carry out the purposes and policies of this act, as the commission shall by rule prescribe."13/ (Emphasis supplied.)
[[Orig. Op. Page 13]]
Under this section a candidate's report is due within two weeks of his attaining of that defined status ‑ irrespective of when he publicly announces or files. Since a person will become a "candidate" under RCW 42.17.020 (5), supra, prior to the time of his announcement by receiving and retaining contributions or making expenditures". . . with intent to promote his candidacy for office. . .," it follows that once an individual has formed an intent to be a candidate for election or reelection to a given office he must then proceed to file his RCW 42.17.240 financial disclosure report upon the first receipt of contributions or the first disbursement of expenditures intended to promote this candidacy.14/ However, of course, the existence or nonexistence of this essential intent factor is purely a factual question so that not every receipt of private financial assistance, for example, by a person in the public arena ‑ whether currently in office or not ‑ will cause that person to be deemed a candidate under this portion of the initiative.
To be contrasted with the deadline set in RCW 42.17.240, supra, for a candidate to file his required report of financial interests is the requirement contained in the next section to be noted ‑ § 5, which has been codified as RCW 42.17.050. This section reads, in material part as follows:
"(1) Each candidate,at or before the time he announces publicly or files for office, and each political committee, at or before the time it files a statement of organization, shall designate and file with the commission the names and addresses of:
"(a) One legally competent individual, who may be the candidate, to serve as a campaign treasurer; and
"(b) One bank doing business in this state to serve as campaign depository."15/ (Emphasis supplied.)
[[Orig. Op. Page 14]]
Here, the deadline for compliance arrives only at such time as the individual in question publicly announces his candidacy or files as such. At this time he must designate and report the names of his campaign treasurer and depository, and upon doing so he must also then comply with the following additional reporting requirements of § 8 of the initiative (RCW 42.17.080):
"On the day the campaign treasurer is designated, each candidate or political committee shall file with the commission and the county auditor of the county in which the candidate resides (or in the case of a political committee supporting or opposing a ballot proposition, the county in which the campaign treasurer resides),in addition to any statement of organization required under section 4, a report of all contributions received and expenditures made in the election campaign prior to that date: . . ." (Emphasis supplied.)
Because of the relationship between this section and RCW 42.17.050,supra, it will readily be seen that this requirement also is keyed, in point of time, to the individual's public declaration of candidacy or his filing, rather than to his acquisition of the mere status of a "candidate" as with RCW 42.17.240,supra.
Before moving on to your next question let us return, again, to this last cited statute in order to clarify another matter which might otherwise be misunderstood ‑ particularly in view of our answer to question (1), supra, relative to the election campaigns to which Chapter I of the initiative applies. The point we would again make and here emphasize is that RCW 42.17.240, requiring candidates to file reports of their financial affairs within two weeks of attaining this status (and regardless of when they publicly announce or file their declarations of candidacy) is not a part of Chapter I of the initiative as are the other sections discussed in this opinion. Instead, it is contained in a separate chapter ‑ Chapter III ‑ relating to the disclosure of the financial affairs of both candidates and elected officials. For this reason it is to be seen that insofar as candidates are concerned, this statute applies to all except those seeking election to the offices of president, vice‑president and precinct committeemen ‑ irrespective of the particular constituency. In other words, while candidates for offices in less than county-wide constituencies with less than 5,000 registered voters are excluded from compliance with the candidates' filing and reporting requirements of Chapter I, they are not thereby exempted from the reporting requirements of Chapter III as set forth in RCW 42.17.240,supra. Nor, by the [[Orig. Op. Page 15]] same token, are they exempted from these financial disclosure requirements because their campaign expenditures are not in excess of $1,000 ‑ even though under WAC 390-04-200,supra, they may obtain an exemption from the reporting requirements of §§ 4-9 of the initiative (RCW 42.17.040 ‑ 42.17.090) by reason of this fact.
What is a political committee?
Section 2 (22) of the initiative (RCW 42.17.020 (22)) defines this term as follows:
"(22) 'Political committee' means any person (except a candidate or an individual dealing with his own funds or property) having the expectation of receiving contributions or making expenditures in support of, or opposition to, any candidate or any ballot proposition."
Therefore, any "person" who expects to receive contributions or make expenditures supporting or opposing any candidate or ballot proposition is a political committee ‑ except a candidate or an individual dealing with his own funds or property.16/ Furthermore, it is to be noted that the word "person" is defined very broadly by RCW 42.17.020 (19) to include
". . . an individual, partnership, joint venture, public or private corporation, association, federal, state or local governmental entity or agency however constituted, candidate, committee, political committee, political party, executive committee thereof, or any other organization or group of persons, however organized."
Thus it is readily to be seen, for example, that the term "political committee" includes not only those more or less formal campaign organizations that are formed to support or oppose a particular candidate, slate of candidates or ballot proposition or propositions but, as well, all organizations of any type which receive contributions in support or opposition either to one or more candidates or to one or more ballot propositions ‑ or which make expenditures for those purposes.
[[Orig. Op. Page 16]]
Accordingly, for example, this term would include all of the state or county central committees of the major political parties as provided for in chapter 29.42 RCW, and it would also include any less formally organized political clubs or the like which expend some portion of their dues or similar income in support or opposition to candidates or ballot propositions. On the other hand, the term "political committee" would not cover an organization to which its members pay dues but which expends no portion of such dues or any other funds to support or oppose any candidates or ballot propositions. Furthermore, it is conceivable that such an organization may engage in activities properly described as "political" without being a political committee. For instance, its political activities might consist solely of obtaining and making general information available to its members concerning candidates and/or ballot propositions in order to assist its members in deciding for themselves on the basis of such information which candidates and/or ballot propositions each of them will support through his or her own independent action. As long as the organization does not attempt in any manner to influence the decision of its members in that regard, or to act as spokesman or agent for any such members in furnishing or expressing such support, it would not be a "political committee" in our opinion.
Having become a political committee, what action is immediately required of the organization in question?
As in the case of a candidate there are also three separate actions required of a political committee at the time of its attainment of this status or shortly thereafter.
(a) Within ten days after a political committee is organized or within ten days after the date when it first expects to receive contributions or make expenditures in an election campaign, whichever is earlier, such a committee is required by § 4 (RCW 42.17.040) to file a statement of organization.17/
[[Orig. Op. Page 17]]
The statement is to be filed with the Public Disclosure Commission and, in addition, if the committee supports or opposes a candidate or candidates, a duplicate must be filed with the county auditor of each county or counties in which such candidate or candidates reside. If the committee supports or opposes a ballot proposition, then a duplicate statement of organization must be filed with the county auditor of the county in which the committee's campaign treasurer resides.
(b) Each political committee, at or before the time it files its statement of organization, must designate and file with the commission a statement naming a campaign treasurer and depository, as provided for in RCW 42.17.050, supra.
[[Orig. Op. Page 18]]
(c) At the time of its designation of a campaign treasurer and depository, the political committee must also file its initial report of contributions received and expenditures made, in accordance with RCW 42.17.080, supra.
Special note should here also be made of the requirements to be met by any political committee which was in existence on the effective date of the initiative (January 1, 1973) ‑ including such continuing committees as the state and county central committees of the two major political parties.18/ In the case of any such committees each of the above three initial reports is to have been filed with the commission by March 31, 1973. See, RCW 42.17.040, requiring a statement of organization within ninety days of the initiative's effective date; RCW 42.17.050, requiring the designation of a campaign treasurer at the time the statement of organization is filed; and finally RCW 42.17.080, requiring an initial report of receipts and expenditures on the day the treasurer is designated.
When must additional reports subsequent to the initial reports above described be made by a candidate or political committee?
RCW 42.17.080 (2) sets forth a timetable for the periodic filing of reports of ". . . the contributions received and expenditures made [in the election campaign] since the date of the last report [of such matters]. Under this section an updated report of all such contributions and expenditures is required on the tenth day of each month preceding the election in which no other such reports are required to be filed. In addition, such a report is required to be filed on the nineteenth day prior to the election ‑ and, again, on the fifth day prior to the election. And thirdly, another updated report of all contributions and expenditures is to be made within ten days after the date of a primary election and within twenty-one days after all other elections.
This statute then goes on to provide that the last of the reports ‑ i.e., the post-election report ‑
". . . shall be the final report if there is no outstanding debt or obligation, and the campaign fund is closed, and the campaign is [[Orig. Op. Page 19]] concluded in all respects, and if in the case of a political committee, the committee has ceased to function and has dissolved."
However, if the candidate or political committee has any outstanding debt or obligation, additional reports must be filed at least once every six months until the obligation or indebtedness is entirely satisfied. By the same token, a continuing political committee must continue to file reports until such time as it is dissolved, at which time it files its final report.
Does the phrase "all contributions received . . . in the election campaign . . ." include all moneys received for tickets to a fund raising dinner or like function, and if so, what information respecting such ticket sales must be reported?
RCW 42.17.020 (8) defines the term "contribution" to include (insofar as is here material) any
". . . loan, gift, deposit, subscription, forgiveness of indebtedness, donation, advance, pledge, payment, transfer of funds between political committees, or transfer of anything of value . . ."
Thus, without question, this term must be said to include at least some portion of the purchase or donation price of a ticket to a political fund raising event. However, as will be seen from a reading of the final sentence of this subsection, notall of these moneys will be required to be reported ‑ for this portion of RCW 42.17.020 (8) states that:
". . . Sums paid for tickets to fund-raising events such as dinners and parties are contributions; however, the amount of any such contribution may be reduced for the purpose of complying with the reporting requirements of this chapter, by the actual cost of consumables furnished in connection with the purchase of such tickets, and only the excess over actual cost of such consumables shall be deemed a contribution."
As for the manner of reporting such contributions the initiative provides, in § 9 (RCW 42.17.090) as follows:
[[Orig. Op. Page 20]]
"(1) Each report required under section 8 of this act shall disclose for the period beginning at the end of the period for the last report or, in the case of an initial report, at the time of the first contribution or expenditure, and ending not more than three days prior to the date the report is due:
". . .
"(b) The name and address of each person who has made one or more contributions during the period, together with the money value and date of such contributions and the aggregate value of all contributions received from each such person during the preceding twelve‑month period: PROVIDED, that contributions not exceeding five dollars in aggregate from any one person during the election campaign may be reported as one lump sum so long as the campaign treasurer maintains a separate and private list of the names and amounts of each such contributor;
". . ."
From this it will be seen that if the net sale or donation price of the ticket or tickets sold or given to a particular individual is in excess of five dollars (after deducting the costs of consumables as above provided), the report must include his name and address, the date of the transaction, and the aggregate net amount of the purchase price or donation given in exchange for the tickets. If it is less than this amount, it may instead, be lumped with other contributions of five dollars or less in the report, so long as the campaign treasurer maintains a "separate and private list of the names and amounts of each such contributor."
What details must be provided in a report of campaign expenditures under the initiative?
RCW 42.17.090 (f) ‑ (i) lists the requirements of a report of campaign expenditures as follows:
"Each report required under RCW 42.17.080 shall disclose . . .
"(f) The name and address of each person to whom an expenditure was made in the aggregate [[Orig. Op. Page 21]] amount of twenty-five dollars or more, and the amount, date and purpose of each such expenditure;
"(g) The total sum of expenditures;
"(h) The surplus or deficit of contributions over expenditures;
"(i) The disposition made of any surplus of contributions over expenditures;"
Where are the foregoing reports of contributions and expenditures to be filed?
This question is fully answered by RCW 42.17.080 (1), supra, under which each of these reports of contributions and expenditures must be filled with the Public Disclosure Commission, through the Office of the Secretary of State, and with the county auditor of each county or counties in which the involved candidate or candidates reside ‑ or, where a political committee is supporting or opposing a ballot or proposition, the county auditor of the county in which its campaign treasurer resides.
Additionally, it should be noted that copies of all reports relating to campaign contributions and expenditures are required by RCW 42.17.080 (5) to be readily available for public inspection at the principal campaign headquarters, or if there is no campaign headquarters, then at the address of the campaign treasurer.
How are monetary financial contributions to be identified and physically handled under the initiative?
Under RCW 42.17.060 (1) all monetary contributions must be deposited (they may not be expended before deposit) by the campaign treasurer or a deputy campaign treasurer in a campaign depository in an account designated "campaign fund of " (the name of candidate or political committee). Subsection (2) of this statute then states that all [[Orig. Op. Page 22]] such deposits must be accompanied by a statement containing the name of each person who has contributed over five dollars, and the amount contributed by each such person. This statement is to be made in triplicate, one copy to be retained by the campaign depository for its records, one copy to be filed with the commission, and one copy to be retained by the campaign treasurer. Each such statement must be certified as correct by the campaign treasurer or deputy treasurer making the deposit, in accordance with the requirements of this subsection.
Who may authorize campaign expenditures?
RCW 42.17.070 covers this point as follows:
"No expenditures shall be made or incurred by any candidate or political committee except on the authority of the campaign treasurer or the candidate, and a record of all such expenditures shall be maintained by the campaign treasurer."
It is important to note here that although either a campaign treasureror deputy treasurer may receive and deposit campaign contributions, only the treasurer (or the candidate himself) may authorize campaign expenditures. This does not mean, of course, that all expenditures must be physically made by these individuals. Other campaign workers, including persons serving as deputy campaign treasurers, may expend campaign moneys ‑ but the point is that they may only do so on authority granted to them by either the candidate or the treasurer of the campaign.
What requirements does the initiative impose upon an individual who is neither a "candidate" nor a "political committee" ‑ i.e., an individual not seeking a public office ‑ in dealing with his own funds or property?
Under RCW 42.17.100 (codifying § 10 of the initiative), reports are required to be made to the commission by
". . . Any person who makes an expenditure in support of or in opposition to any candidate or proposition (except to the extent that a contribution is made directly to a [[Orig. Op. Page 23]] candidate or political committee), in the aggregate amount of one hundred dollars or more during an election campaign, . . ."
See, also, WAC 390-04-170, a regulation adopted by the commission, which repeats this requirement. Such reports must disclose (a) the name of the person making the expenditure and his address, and (b) the date, nature and payee or other recipient of such expenditure and the purpose for which it was made.
Since this section of the initiative is silent on the question ofwhen such reports are to be filed, the commission has covered this matter by a regulation ‑ WAC 390-04-180 ‑ which provides that:
"The report required by § 10, chapter 1, Laws of 1973 (Initiative 276) and WAC 390-04-170 herein, shall be filed with the commission as follows:
"(a) In the case of expenditures aggregating $100 or more, but less than $500, within one week of the date at which such aggregated expenditure amount is reached; except that during the week immediately preceding the week in which the election is held such reports shall be filed within two business days following the day on which such aggregate expenditure amount is reached;
"(b) In the case of expenditures aggregating $500 or more, within two business days following the day on which such aggregated expenditure amount is reached."
In addition, although no report is required under this section with respect to a contribution made directly to a candidate or political committee, we have heretofore seen that such contributions will be reportable by the campaign treasurer involved under RCW 42.17.080 and 42.17.090, supra, discussed in connection with questions (7) through (11), above. Moreover, with these alternative reporting requirements in mind the commission has provided by WAC 390-04-190 that:
"If a candidate or a political committee advises, counsels or otherwise knowingly encourages any person to make an expenditure which, if made by the candidate or committee would be regulated by §§ 8 and 9, chapter 1, Laws of 1973, for the purpose of [[Orig. Op. Page 24]] avoiding direct contributions or for any other reason, the person making such expenditure shall be considered an agent of the candidate or political committee encouraging the expenditure, and the expenditure shall be considered for all intents and purposes as an expenditure of such candidate or political committee."
Also to be noted here is subsection (2) of RCW 42.17.100, which goes on to provide that if an individual contributes an aggregate amount in excess of $100 or more during a twelve‑month period, to a political committee not domiciled in Washington and not otherwise required to report under the initiative and he reasonably expects the political committee to make contributions in respect to an election covered by the initiative, then he must file a report. The report must disclose the contributor's name and address, the date, nature, amount and recipient of the contribution, and any instruction given as to the use or disbursement of the contribution.
If a corporation or similar association or organization makes a contribution to a political committee or candidate, does it thereby itself become a political committee as defined in RCW 42.17.020 (22), supra?
Repeated for ease of reference RCW 42.17.020 (22), supra, defines the term "political committee" as meaning
". . . any person (except a candidate or an individual dealing with his own funds or property) having the expectation of receiving contributions or making expenditures in support of or opposition to, any candidate or any ballot proposition."
Presumably, the corporation or other organization19/ contemplated by this question has notreceived contributions to support or oppose a candidate or ballot proposition. The question remains, has it made expenditures in support of, or in opposition to, any candidate or ballot proposition. The term "expenditures" is defined in RCW 42.17.020 (12) in relevant part, as follows:
[[Orig. Op. Page 25]]
"'Expenditure' includes a payment, contribution, subscription, distribution, loan, advance, deposit, or gift of money or anything of value, and includes a contract, promise, or agreement, whether or not legally enforceable, to make an expenditure. . . ." (Emphasis supplied.)
A technical reading of that statute would thus indicate that the act of making a contribution is an "expenditure" and hence by making the contribution described the corporation or other organization would itself become a political committee. However, statutes must be read as a whole in order that the general purpose will not be lost in a technical or pedantic construction of a particular section or word. Alderwood Water Dist. v. Pope & Talbot, 62 Wn.2d 319, 382 P.2d 639 (1963);Wilson v. Lund, 74 Wn.2d 944, 447 P.2d 603 (1968). Reading the whole act here involved, it seems clear that the result which would follow from this technical construction was not intended for two basic reasons:
In the first place it will be seen that if such a corporation or organization as you have described were itself considered to be a political committee, it would have to do several things which bear no relation to the purposes of the initiative. For example, it would have to indicate what distribution of surplus funds will be made in the event of its dissolution (see, RCW 42.17.040 (2) (h); it would have to appoint a campaign treasurer and depository to hold its money (RCW 42.17.050); all monetary contributions received by it would have to be placed in a special bank account designated the "campaign fund of " (RCW 42.17.060 (1));20/ all deposits made by the corporation or other organization would have to be accompanied by a statement naming the person contributing the funds deposited (RCW 42.17.060 (2); and it would have to file detailed reports of contributions and expenditures (RCW 42.17.080 and 42.17.090.
In short, if such a technical construction were to be given the statute, it would require that any corporation or other [[Orig. Op. Page 26]] organization which made a political contribution would thereby have to disclose all of its financial dealings and internal accounts, and comply with an over-all statutory scheme which clearly was only meant to affect those organizations whose primary purpose is to attempt to influence elections. All this would contravene the well-established rule of statutory construction that absurd constructions are to be avoided whenever possible. Accord, AGO 1973 No. 5 [[to Wayne Ehlers, State Representative on February 5, 1973]],supra; see, also, In re Horse Heaven Irrigation District, 11 Wn.2d 218, 118 P.2d 972 (1941); andDiscargar v. Seattle, 25 Wn.2d 306, 171 P.2d 205 (1946).
Secondly, as we have just seen in answering your previous question, § 10 of the initiative (RCW 42.17.100) provides, in relevant part, as follows:
"In addition to the other reports required by this act:
"(1) Any person who makes an expenditure in support of or in opposition to any candidate or proposition (except to the extent that a contribution is made directly to a candidate or political committee), in the aggregate amount of one hundred dollars or more during an election campaign, shall file with the commission a report signed by the contributor disclosing (a) the contributor's name and address, and (b) the date, nature, amount and recipient of such contribution or expenditure; . . ."
The obvious purpose of this section is to insure that substantialdirect expenditures (i.e., those of over one hundred dollars) in support of or in opposition to a candidate or ballot proposition are reported. If the expenditure, instead, is in the form of a contribution to a candidate or political committee, it will be required to be reported by that committee or candidate, and hence there is no need for a duplicate report from the "person" making it. Assuming, as we safely may, that most persons will take the easiest route to the object sought, it will thus be seen that a construction of RCW 42.17.020 (22),supra, which would cause a corporation or other organization making a contribution to be considered a political committee would largely insure that those organizations wishing to be politically active would not contribute but would, instead, expend their funds directly ‑ and thus avoid the detailed reporting requirements imposed upon political committees. Yet the initiative evinces no intent to discourage contributions, but merely to disclose them. As declared in § 1 (1) (RCW 42.17.010):
[[Orig. Op. Page 27]]
"It is hereby declared by the sovereign people to be the public policy of the state of Washington:
"(1) That political campaign and lobbying contributions and expenditures be fully disclosed to the public and that secrecy is to be avoided."
As we have also heretofore seen, where a contribution is made to a political committee or candidate the names of the contributors must be disclosed if the contribution aggregates over five dollars ‑ under RCW 42.17.090 (b), quoted above. However, under RCW 42.17.100, supra, direct expenditures need not be reported unless they aggregate over one hundred dollars. Secrecy is thus best avoided by encouraging contributions to political committees and candidates. In this light, we must bear in mind the following additional admonition of § 1 (RCW 42.17.010),supra:
"The provisions of this act [Initiative 276] shall be liberally construed to promote complete disclosure of all information respecting the financing of political campaigns. . ."
We therefore conclude that expenditures made by a corporation or other organization in the form of contributions to political committees or candidates do not make that organization a political committee; and for this reason we answer this question in the negative.
What does the initiative require in terms of reports by commercial advertisers?
We begin by here noting the definition of "commercial advertiser" in RCW 42.17.020 (6). As therein defined this term includes
". . . any person who sells the service of communicating messages or producing printed material for broadcast or distribution to the general public or segments of the general public whether through the use of newspapers, magazines, television and radio stations, billboard companies, direct mail advertising companies, printing companies, or otherwise."
[[Orig. Op. Page 28]]
From this definition it will be seen that this term covers any public relations firms or the like which may be employed by a candidate or a political committee, as well as the various news or other media through which their political advertising is communicated.
With respect to such persons or enterprises, RCW 42.17.110 (1) requires that within fifteen days after an election each commercial advertiser must file with the commission a report certified as correct which specifies:
(a) The names and addresses of persons from whom it accepted political advertising;
(b) The exact nature and extent of the advertising services rendered;
(c) The consideration and manner of paying the consideration for such services; and
(d) Such other facts as the commission may by regulation prescribe.
However, under subsection (2) of this section no report is required from any commercial advertiser as to any single candidate or political committee when the total value of its political advertising does not exceed fifty dollars.
In the event that a candidate, political committee, or other person believes that literal compliance with any of the reporting requirements of the initiative will work an unreasonable hardship, what recourse is available to such person?
RCW 42.17.370, dealing with the powers of the Public Disclosure Commission, provides, in part, that:
". . .
"(9) The commission, after hearing, by order may suspend or modify any of the reporting requirements hereunder in a particular case if it finds that literal application of this act works a manifest unreasonable hardship and if it also finds that such suspension or modification will not frustrate the purpose of the act. [[Orig. Op. Page 29]] Any such suspension or modification shall be only to the extent necessary to substantially relieve the hardship. The commission shall act to suspend or modify any reporting requirements only if it determines that facts exist that are clear and convincing proof of the findings required hereunder. Any citizen shall have standing to bring an action in Thurston County Superior Court to contest the propriety of any order entered hereunder within one year from the date of the entry of such order."
Thus, the recourse of a candidate or political committee under the circumstances described in this question is that of applying to the commission for whatever is deemed to be an appropriate suspension or modification of the particular statutory requirement of the initiative to which he or it objects. Accord, WAC 380-04-120, a regulation adopted by the commission, which implements this subsection as follows:
"(1) Any elected official or candidate or other person who considers any of the reporting requirements of chapter 1, Laws of 1973, to constitute an unreasonable hardship in his particular case may apply for an exemption from such reporting requirements pursuant to § 37 (9) of said chapter [RCW 42.17.370 (9)] and further pursuant to these regulations. An elected official or lobbyist's employer requesting such exemption shall file an application therefor no later than December 15th of the year preceding the year in which the report would be due. A candidate for elected office shall file such application no later than one week after becoming a candidate. Any other person requesting such exemption shall file such application as early as practicable before the due date of the applicable report."21/
[[Orig. Op. Page 30]]
What restrictions does the initiative impose upon the use of public facilities in election campaigns?
Section 13 of the initiative, codified as RCW 42.17.130, states that:
"No elective official nor any employee of his office may use or authorize the use of any of the facilities of his public office, directly or indirectly, for the purpose of assisting his campaign for reelection to the office he holds, or for election to any other office, or for election of any other person to any office or for the promotion or opposition to any ballot proposition. Facilities of public office include, but are not limited to, use of stationery, postage, machines and equipment, use of employees of the office during working hours, vehicles, office space, publications of the office, and clientele lists of persons served by the office: PROVIDED, that this section shall not apply to those activities performed by the official or his office which are part of the normal and regular conduct of the office."
This section appears to be rather self-explanatory. It expressly prohibits an elective official or any of the employees of his office from directly or indirectly using ". . . any of the facilities of his public office. . ." for the purpose of assisting his campaign either for reelection or election to another office, or for the election of any other person to office, or, thirdly, for the promotion or opposition to any ballot proposition. The only exception to this rule covers the activities providing such assistance which are performed by the official or his office as a part of the normal and regular conduct of that office.
In apparent recognition of a need for a slightly greater degree of precision as to the over-all impact of this section of the initiative, however, the Public Disclosure Commission has recently adopted an interpretive regulation which we should also include in this opinion for ease of reference. The regulation is WAC 390-04-040 and reads as follows:
[[Orig. Op. Page 31]]
"Whereas sec. 13 of the Act forbids certain political uses of the office facilities of elected public officials but expressly denies the application of that section to activities which are a part of the normal and regular conduct of an office; it shall be the policy of the Commission to construe the term 'use of any facilities' in sec. 13 of the Act as meaning only (1) uses of 'facilities', as that term is therein defined, which constitute or result in a measurable expenditure of public funds; or (2) such uses which have a measurable dollar value.
"Examples of activities or uses which the commission considers to be excluded from sec. 13 of the act are verbal endorsements or statements favoring or opposing candidates or ballot issues which endorsements or statements do not directly or indirectly involve any measurable expenditures of public funds."
The final four questions raised by your request all involve aspects of § 14 of the initiative, codified as RCW 42.17.140, which, as approved by the voters, established the following expenditure limitations both in connection with campaigns for public office and those relating to ballot measures:
"(1) The total of expenditures made in any election campaign in connection with any public office shall not exceed the larger of the following amounts:
"(a) Ten cents multiplied by the number of voters registered in the constituency at the last general election for the public office; or
"(b) Five thousand dollars; or
"(c) A sum equal to the public salary which will be paid to the occupant of the office which the candidate seeks, during the term for which the successful candidate will be elected: Provided, That with respect to candidates for the office of governor and lieutenant governor of the state of Washington only, a sum equal to the public salary which will be paid the governor during the term sought, multiplied by two; and with respect to candidates for [[Orig. Op. Page 32]] the state legislature only, a sum equal to the public salary which will be paid to a member of the state senate during his term.
"(2) In any election campaign in connection with any state‑wide [[statewide]]ballot proposition the total of expenditures made shall not exceed one hundred thousand dollars. The total of such expenditures in any election campaign in connection with any other ballot proposition shall not exceed ten cents multiplied by the number of voters registered in the constituency voting on such proposition."
As indicated at the outset of this opinion, however, this section of the initiative has been declared unconstitutional by the Thurston County Superior Court as being in violation of the First Amendment to the United States Constitution. If upon appeal to a higher court this ruling should be reversed and § 14,supra, should be reinstated as an operative part of the initiative, we will be happy at that time to give consideration to your questions as to its meaning and impact upon various electoral campaign situations. In the meantime, limiting ourselves to the present state of the law, as above explained, we will refrain from passing upon these questions.
We trust the foregoing will be of assistance to you.
WAYNE L. WILLIAMS
Assistant Attorney General
*** FOOTNOTES ***
1/Accord, Wash. Const., Article II, § 1 (Amendment 7).
2/See, § 49.
3/These and some twenty-three other terms are expressly defined in § 2 of the initiative, now codified as RCW 42.17.020.
4/In addition to Chapters I and III to be discussed in this opinion, the law also contains a major segment, denominated Chapter II, which regulates legislative lobbying; and another (Chapter IV) involving access to the records of public agencies.
5/On May 31, 1973, to be specific.
6/Simmons, et al. v. Gorton, et al., Cause No. 47665.
7/Fritz, et al. v. Gorton, et al., Cause No. 47522.
8/Young Americans for Freedom, et al. v. Gorton, Cause No. 47680.
9/Bare v. Gorton, et al., Cause No. 47679.
10/See, also, WAC 390-04-220 which qualifies these two regulations by providing that:
"The exemptions allowed in WAC 390-04-200 and WAC 390-04-210 shall be granted to a candidate or political committee only upon compliance with the following conditions.
"(1) The candidate or political committee must, at the time of organization, or at the time of receipt of contributions or the making of expenditures or at the time of reservation of space or facilities with intent to promote or oppose a candidacy for office or with intent to promote or oppose a ballot proposition, whichever comes first, file a declaration with the commission indicating that the candidate or political committee does not intend to exceed the expenditure limitations set out in WAC 390-04-200 and 390-04-210.
"(2) The candidate or political committee must, throughout the ensuing election campaign, keep current records in sufficient detail to allow the candidate or political committee to make reports otherwise required by sections 4-9 of the initiative in the event that the filing of such reports becomes necessary as a result of the permissive exceeding of the expenditure limitation by the candidate or political committee."
11/See the definition of "Federal Elective Office" in §§ 102 and 301 of the federal act.
12/Accord, the so-called "supremacy clause" of Article VI of the United States Constitution.
13/Various specific questions involving the reporting requirements of this section have been answered by this office in AGO 1972 No. 29 [[to Irving Newhouse, State Representative on December 22, 1972]], AGO 1973 Nos. 1 [[to R. Frank Atwood, State Senator on January 3, 1973]]and 6 [[to Irving Newhouse, State Representative on February 9, 1973]], and AGLO 1973 Nos. 2 [[to Paul Klasen, Prosecuting Attorney, Grant County on January 4, 1973, an Informal Opinion AIR-73502]]and 9 [[to Paul Klasen, Prosecuting Attorney, Grant County on January 16, 1973, an Informal Opinion AIR-73509]]. See, also, WAC 390-04-150 with respect to certain primafacie qualifications for exemptions from this requirement which have been established by the commission.
14/From this it will readily be seen that although the first § 24 reports of elected officers are not due until January 31, 1974, these reports will be required of the same individuals as "candidates" during the current year if they then become such. See, AGO 1972 No. 29 at pp. 11-12, wherein this same point was made and explained in more detail.
15/In addition, this section goes on to provide that a candidate or committee may name as many deputy campaign treasurers as are considered necessary and may designate one additional campaign depository in each county in which the campaign is conducted.
16/See question (15), below, for a further discussion of this exception.
17/RCW 42.17.040 (2) sets forth the requirements for this statement of organization as follows:
"(2) The statement of organization shall include but not be limited to:
"(a) The name and address of the committee;
"(b) The names and addresses of all related or affiliated committees or other persons, and the nature of the relationship or affiliation;
"(c) The names, addresses, and titles of its officers; or if it has no officers, the names, addresses and titles of its responsible leaders;
"(d) The name and address of its campaign treasurer and campaign depository;
"(e) A statement whether the committee is a continuing one;
"(f) The name, office sought, and party affiliation of each candidate whom the committee is supporting or opposing, and, if the committee is supporting the entire ticket of any party, the name of the party;
"(g) The ballot proposition concerned, if any, and whether the committee is in favor of or opposed to such proposition;
"(h) What distribution of surplus funds will be made in the event of dissolution; and
"(i) Such other information as the commission may by regulation prescribe, in keeping with the policies and purposes of this act."
It should further be noted that if any material change in the information in the statement of organization occurs, it must be reported to the commission and to the appropriate county auditor within ten days following the change.
18/See, chapter 29.42 RCW, as noted in question (7) above.
19/Clearly a "person" as defined in RCW 42.17.020 (19), supra, but not an "individual dealing with his own funds or property."
20/This would, for practical purposes, mean all revenue of the corporation, since "contribution" is broadly defined in RCW 42.17.020 (8) as including ". . . a loan, gift, deposit, subscription, forgiveness of indebtedness, donation, advance, pledge, payment, transfer of funds between political committees, or transfer of anything of value, including personal and professional services, for less than full consideration, . . ."
21/Also again to be noted is WAC 390-04-150 which keys in, particularly, on the reporting requirements of RCW 42.17.240, supra (financial interests of candidates and elected officials) and lists a number of instances which the commission will regard as constitutingprimafacie qualifications for exemptions from the requirements of this section of the initiative.