ILLINOIS CAMPAIGN DISCLOSURE

Presented by Andrew M. Raucci

Illinois Campaign Disclosure Act

10 ILCS 5/9-1 et seq.

State Board of Elections www.elections.il.gov

Introduction

Brief overview of Illinois campaign disclosure 1974-2010

Overview of 2010 changes & introduction to new contribution limits

2010 Amendments2010 Amendments provided contribution limits for first

timeScrapped old political committee definitionsEstablished four new political committee definitionsEstablished “election cycles” for receipt of campaign

contributionsEstablished contribution limitsDefined & required reporting for independent expendituresEstablished procedures for auditing of political committeesEstablished on-line database of founded campaign finance

complaints

Types of Political Committees

Candidate Political CommitteesPolitical Party CommitteesPolitical Action CommitteesBallot Initiative CommitteesDoes not apply to Federal offices

Candidate Political CommitteesCandidate or another person(s) or entitiesReceives contributions or expends $3,000

in 12 month period“Public Official” appears to be “Candidate”Only candidate’s committee can have

candidate’s name Limited to one committee for each office

sought Committee opposed to a candidate is a

political action committee

Political Party CommitteesState Central CommitteesCounty Central CommitteesLegislative Caucus Committees

Committee established for purpose of electing persons to the General Assembly

Established by President of Senate or Speaker of the House or Minority Leader of either House or 5 or more members of Senate or 10 or more members of the Senate

Ward or Township CommitteeNo $3,000 threshold necessary for political party

committees

Political Action CommitteesPersons (other than a candidate) or entitiesReceives contributions or expends $3,000 in

12 month period in support of or opposition to candidates

Expends $3,000 in independent expenditures in any 12 month period in relation to candidate(s)

Informal group shall include names of persons responsible

Ballot Initiative CommitteesPerson(s) or entity(ies)Must have name that reflects ballot initiative issueReceives contributions or expends $3,000 in 12 month period

in support of or opposition to ballot initiativesExpends $3,000 in independent expenditures in any 12 month

period in support of or in opposition to ballot initiatives$3,000 threshold applies even if ballot initiative is not on ballotStatement of Organization must contain verification that

committee formed to support or oppose ballot initiative, all contributions & expenditures will be used for that purpose, and the committee will accept unlimited contributions from any source provided it does not make contributions or expenditures related to any candidate

Electioneering Communications & Independent Expenditures

(Effective July 1, 2010)

Electioneering CommunicationsAny broadcast advertisement or

communication that 1) refers to a clearly identified candidate, political party or public policy question, 2) is made in the 60 days before a general [even-numbered year] election or consolidated [odd-numbered year] election or primary election, 3) is targeted to the relevant electorate, and 4) is clearly an appeal to vote for or against the candidate or ballot initiative

Independent ExpendituresAny payment or expenditure made for election communications

or expressly advocating for or against a candidate provided that the spending is not made in connection (in any way) with a candidate or his committee

Is not considered to be a contribution and should not be reported as such

If more than $3,000 in 12 month period supporting or opposing a candidate(s): An entity (including 2 or more persons) making expenditure must

organize and file as political committee A single person must file a written disclosure with the State Board of

Elections within 2 business days of exceeding the $3,000 threshold Identifying the person The person’s employer & occupation The public official or candidate supported or opposed The date(s), amount(s) and nature of each Independent Expenditure

Date of Receipt of Campaign ContributionsCash or check-date of deposit in bankCredit card-date notice received by

political committee that funds were deposited

In-kind contribution-date notification of contribution of goods or services received (contributor is to notify political committee within 5 business days of making in-kind contribution)

Statements of Organization (Form D-1)

To be filed within 10 business days (2 business days if formed within 30 days of an election) with State Board of Elections

Required to show name, address, date of creation, amount of funds available at creation, type of political committee, area of operation, purpose, candidate(s) supporting or opposing, officers, custodian of books & records, repositories of committee’s funds, name of any sponsoring entity, disposition of residual funds“sponsoring entity” is any person or entity that

contributes at least 33% of the committee’s total fundingAny change to be reported within 10 calendar days

Quarterly ReportsNow filed quarterly and not semi-annuallyJanuary-March, April-June, July-September,

October-DecemberFiled by Midnight of 15th Day after end of quarter

(April 15, July 15, October 15, January 15) or 5 p.m. if on paper

Required even if no activity in quarterDetailed accounting of all receipts or

expenditures made during quarterItemization of receipts or expenditures over $150

BundlersNew reporting requirementBundler defined:

Collects or accepts at least $3,000 in quarterFrom at least 5 persons or entities outside the

presence of the candidate or not in conjunction with a candidate’s sanctioned fundraiser

Not an officer, compensated employee, authorized by an officer of committee or candidate

Not an entity used for processing financial transactions by credit card or other means

Electronic Filing Required if political committee during

quarter eitherAt any time had balance or accumulation of

contributions of $10,000 or moreMade aggregate expenditures of $10,000 or

moreReceived loans of an aggregate of $10,000

or moreOnce in electronic filing committee is in

forever Any committee can voluntarily file

electronically

Nonparticipation ReportsApplies only to political party

committeesIf not participating in primary electionMay receive unlimited contributions

from other political party committees and candidate political committees

Year-Round Reporting of Contributions of $1,000 or MoreFiled within 5 business days (2 business

days if received within 30 days before an election and committee supports or opposes a candidate or ballot initiative on ballot or makes expenditures in excess of $500 on behalf of or in opposition to a candidate(s) or ballot initiative)

Reporting Name & Address of Person Filing ReportIf not the Chairman or Treasurer of

committeeNo exemption even if person is

employee, staff member or volunteer, of Chairman, Treasurer or committee

ConduitCorporation, labor organization, association

or a political action committee established by one of those three is allowed to act as a conduit to accept and deliver contributions made through dues, levies or similar assessments

Must maintain list of persons contributingReported as coming from group or PAC,

provided that none of the contributions exceeds the normal contribution limits

Election CyclesNew concept effective January 1, 2011Established based on type of political

committee receiving contributions

Candidate Committees for Even-year General Primary and General Election Contests (two cycles)

For primary election, period beginning January 1 following general election for office to which candidate seeks nomination or election and ending on day of general primary election for that officeExample: Beginning January 1, 2011 and ending on March

20, 2012For general election, period beginning a day after general

primary election and through December 31Example: Beginning March 21, and ending December 31,

2012New primary election cycle would begin January 1, 2013

State Senate Candidate Committees

For candidate committees for candidates for the State SenateIn a ten year period following redistricting, State

Senators are elected for three termsYears of terms are distributed equally by district as

follows: 4-4-24-2-42-4-4

Notwithstanding 4 year terms, State Senate offices have the election cycles attributable to State Representatives and have 10 cycles over ten years

Judicial Retention Candidate CommitteesCircuit judges have 6 year terms, Appellate & Supreme Court judges

have 10 year termsFor incumbent judges seeking retention at even-year general

election (two cycles)Beginning January 1 following general election when judge was

elected through the day (deadline is 6 months before November Election) judge files declaration of intent to seek retention

Beginning day after judge files declaration of intent and ending on December 31 following retention election

Example: A circuit judge was elected in November 2010 and files for retention in May of 2016. The period from January 1, 2011 until the day in May 2016 that he files his declaration of intent constitutes the first cycle. The second cycle begins the day after his filing of the declaration of intent and ends on December 31, 2016.

New cycle would begin on January 1, 2017

Candidate Committees for Odd-year Consolidated Primary and Consolidated Elections (2 Cycles)Township, municipal, community college, school, park

district, library and special district electionsBeginning July 1 following consolidated election and

ending on the day of the consolidated primary electionExample: Beginning July 1, 2011 and ending February 19,

2013Beginning day after consolidated primary election and

ending on June 30 following consolidated electionExample: Beginning February 20, 2013 and ending

June 30, 2013

Political Party Committee (1 Cycle)

Beginning January 1 and ending on December 31 of each calendar yearExample: Beginning on January 1, 2011

and ending on December 31, 2011

Political Action Committee (1 Cycle)

Beginning January 1 and ending on December 31 of each calendar yearExample: Beginning on January 1, 2011

and ending on December 31, 2011

Ballot Initiative Committee (1 Cycle)

Beginning January 1 and ending on December 31 of each calendar yearExample: Beginning on January 1, 2011

and ending on December 31, 2011

Contribution Limits By Recipient Committee Types

New to Illinois, Effective January 1, 2011

Limits are for each election cycleNo limitation on total amount can

receiveNo limitation on total amount that can

be donated to various political committees

Candidate Political Committee (Recipient of Contributions) (I)Individuals $5,000Corporation, union or association $10,000 Other candidate political committees

$50,000Political action committee $50,000Political party committee

(Candidate’s general election cycle) Unlimited

Political party committee(Statewide candidate’s primary election cycle)$200,000

Political party committee (State Senate, Supreme or Appellate Court

in Cook County, or Cook County county-wide officers’ primary election cycle)$125,000

Candidate Political Committee (Recipient of Contributions) (II)Political party committee (State Representative, Supreme or

Appellate Court outside Cook County, county officers outside Cook County, municipal offices in Cook County, county officers in Cook County elected by less than all county voters [primary election cycle]) $75,000

Any other office primary election cycle $50,000Candidate political committee of candidate for General

Assembly can accept contributions from only one legislative caucus committee

No contributions from ballot initiative committee

Political Party Committee(Recipient of Contributions)Individual $10,000Corporation, union or association $20,000Political action committee

$50,000Candidate political committee or political

party committee During petition circulation through primary $50,000 Any other time Unlimited

If recipient political party committee has filed statement of nonparticipation in next primary, it can accept unlimited contributions in period from first day to circulate petitions through day of primary election, e.g., September 6, 2011-March 20, 2012

Legislative caucus committee cannot accept contributions from another legislative caucus committee

No contributions from ballot initiative committee

Political Action Committee (Recipient of Contributions)

Individual $10,000Corporation, union or association $20,000Political candidate committee $50,000Political action committee

$50,000No contributions from ballot initiative

committee

Ballot Initiative Committee (Recipient of Contributions)No limits on contributions

Limits By Type of Contributor (I)

Individual (Maker of Contribution)Candidate political committee $5,000Political party committee $10,000Political action committee $10,000Ballot initiative committee None

Limits By Type of Contributor (II)

Corporation, Union or Association (Maker of Contribution)

Candidate political committee $10,000Political party committee $20,000Political action committee $20,000Ballot initiative committee None

Limits By Type of Contributor (III)Candidate Political Committee

(Maker of Contribution)Candidate political committee $50,000Political party committee

Not participating in primary UnlimitedParticipating in primary $50,000 (Limit repealed July 1, 2013)

Political action committee $50,000Ballot initiative committee None

Limits By Type of Contributor (IV)Political Party Committee (Maker of Contribution)

Candidate political committee $50,000Political party committee

If recipient committee not participating in primary Unlimited If participating in primary $50,000 (Limit repealed July 1, 2013)

Political action committee $50,000Ballot initiative committee NoneNo transfers between legislative caucus committeesNo limits on transfers between state political

committee and federal political committee

COLA ADJUSTMENT

On January 1 of each odd-numbered year, the State Board of Elections shall adjust the contribution limits by using the Consumer Price Index and rounding the numbers to the nearest $100

Disposal of Excess ContributionsExcess contributions to either be

returned to contributor or donated to charity

If not done within 15 days of receipt, excess contribution is escheated to State and political committee is subject to civil penalty of up to 150% of excess contribution

Self-Funding CandidatesDefined as candidate, spouse or childCan make unlimited contributions to that candidate’s

political committeeIf during 12 months prior to an election, the designated

persons contribute, loan or make independent expenditures for the benefit of the candidate, in aggregate, of more than $250,000 for statewide constitutional officers$100,00 for all other offices

To the candidate’s committee or to other committees that transfer funds to the candidate’s committee

Once threshold is reached, candidate must file within 1 day with State Board of Elections a Notification of Self-Funding detailing each such contribution or loan

Limits are removed for other candidates for same office

Disclaimer NoticeAll fundraising solicitations to have the

following disclosure:

A copy of our report filed with the State Board of Elections is (or will be) available on the Board’s website (www.elections.il.gov) or for purchase from the State Board of Elections, Springfield, Illinois

What is a Contribution?Money or anything of value knowingly received in

connection with the election, nomination or retention to Illinois public office, or in connection with any ballot initiative

“Anything of value” includes all things, services or goodsincludes an electioneering communication made in

concert or cooperation with the recipient candidate or committee

services of an employee donated by an employer, unless the services are provided voluntarily and without promise or expectation of compensation from any source

What is Not a Contribution?Voluntary unpaid servicesUse of individual’s real or personal property & the cost of

invitations, food & beverages provided on individual’s residential premises for candidate-related activities, provided the value provided does not exceed $150 in a reporting period

The sale of food or beverage by a vendor as long as vendor charges at least the cost to the vendor of the food or beverage

Communications by a corporation or association to its members, stockholders or executive or administrative personnel or their families

Voter registration or other campaigns that make no mention of a clearly identified candidate, ballot initiative, political party, group, or combination thereof

Independent expenditures Interest or other investment income or refunds or returns of a

committee’s previous expenditures (but they do have to be reported as “Other Income”)

Anonymous Contributions ProhibitedAnonymous contribution, or

contribution made by one person in the name of another, are prohibited

Funds escheat to the State of IllinoisTreasurer to “immediately” forward to

the State Treasurer

Unauthorized Solicitation of Campaign FundsAnother political committee must be

authorized in writing to solicit contributions or make expenditures on behalf of a candidate

If not authorized, soliciting committee must include disclaimer on all literature and advertising that mentions candidate

Disclaimer must state that producing committee is not authorized by candidate, and that candidate is not responsible for activities of the committee

IRS NoticeThe Internal Revenue Service requires

political committees and organizations whose gross annual receipts normally exceed $100,000 to include a clear and easily recognizable statement on fund solicitations that contributions to the committee are not deductible as charitable contributions for federal income tax purposes

Employer & Occupation Information

In cases of contributions, including loans or endorsement of loans, in the aggregate of more than $500 in a quarterly reporting period by an individual, the committee is to report the person’s employer and occupation

Committee is required to make a “good faith effort” to obtain the information

Report of Receipt of ContributionEvery person who receives a

contribution must provide the amount, name and address of the contributor and the date it was received.

Must be provided to the treasurer of the committee within five days of the receipt of the contribution, or on demand of the treasurer.

Fundraising ProhibitionsCommittee cannot accept contributions or make expenditures if

vacancy in offices of Chairman or TreasurerContributions cannot be made or accepted on State property unless

rented or leased to private person or entityOfficers or candidates for statewide offices or the General Assembly,

or caucuses of the General Assembly may not hold fundraising events in Sangamon County (Springfield) on any day either house of the General Assembly is in session between February 1 and adjournment (usually May 31) or during the entire fall Veto Session (usually six days spread over two weeks)

Between June 1 and the Veto Session, this provision does not apply to General Assembly members or candidates whose districts are entirely in Sangamon County

Illegal to promise any government benefit, employment or appointment for a contribution

Illegal to coerce contribution

Use of FundsCommittee cannot pay:

Funds for purpose in violation of federal or state lawMore than fair valueFor debts other than committee’s debts In cashFor expenses of personal residenceFor clothing or laundry except for campaign For purchase of motor vehicle unless more cost-effective than leasing

vehicle used primarily for campaign purposes or performance of governmental duties

For mileage expenses at a rate in excess of IRS standard mileage rateFor educational expenses except for governmental or political purposes

directly related to candidate’s or public official’s duties and responsibilities

Compensation to public official or candidate or his family members unless for services actually rendered to committee

Audits (I)State Board of Elections to order audit if:

Discrepancy between ending balance of reporting period and beginning balance of next reporting period

Failure to account for previously reported investments or loansDiscrepancy between reporting contributions received by or

expenditures made for a political committee that are reported by another political committee, except that no audit shall be ordered for this item unless there is a willful pattern of inaccurate reporting involving similar contributions by the same contributor

Prior to ordering audit, political committee has right to closed preliminary hearing to explain error

Political committee shall hire (and pay for) an entity “qualified” to conduct the audit, provided that the entity has not contributed to the political committee in the last 4 years

Audits (II)

In each calendar year, Board to randomly order no more than 3% of committees to be audited

Audit to ensure that contribution limits and reporting requirements have been met for last two years

Committee has 60 days to conduct audit unless extended by Board

No more than one random audit in 5 years unless Board has reason to believe the committee has violated certain provisions of statute

Subject to fine of $250 per day that audit is late, up to maximum of $5,000

Enforcement of Act by State Board of ElectionsComplaint may be filed by any person who believes a

violation of Act has occurredComplaint filed on Form D-4, Complaint for Violation of the

Campaign Disclosure ActMust be signed & verifiedDirected to candidate or officers of political committee

or anyone alleged to have violated ActClosed preliminary hearing conducted by hearing

officerPurpose is to determine whether any substance to

complaint & whether it has basis in fact & lawClosed preliminary hearing could result in settlement

or in offending committee coming into compliance

Public Hearing Occurs if 5 (of 8) members of Board determine that the complaint

was filed on justifiable grounds If less than 5 members vote for public hearing, complaint is

dismissed Board may determine public hearing not necessary if offender is

going to correct violation Public hearing conducted by hearing officer and resembles an

administrative trial Hearing officer makes recommendation which may be adopted,

modified or rejected by Board Board may enter order compelling compliance with Act or that

violator cease & desist from violating Act Violation of Board order may result in a civil penalty not to exceed

$5,000 (or $10,000 for statewide committees) Board is to act within 60 days of filing of complaint If complaint filed within 7 days of election, Board to decide before

election, if possible

Staff Initiated EnforcementDelinquent Filing of Reports

Staff has procedure for review of all reports filed, and for determining that reports have been filed

Automatic penalties assessed for failure to file or late filing of reports

Penalty based upon type of report filed, number of days late, whether violation was committed inadvertently, negligently, knowingly or intentionally, whether the committee has past violations and any other relevant factors

For first violation, fine will be stayed unless subsequent violation within 2 years If subsequent violation within 2 years, payment of both fines

will be requiredCiting letter sent approximately a week after filing

deadline

Assessment letter sent approximately a month later Includes exact fine, how fine calculated, and forms for appealing the

penaltyCivil penalties for late report filing range from $25 to $5,000 for

statements of organization and quarterly reportsFor late reports of contributions of $1,000 or more where the Board

finds the failure to be willful or wanton, the Board may impose a civil penalty of no less than 10% and no more than 150% of the contributions delinquently reported

Appeal processMust be filed with Board within 30 days of the date of the

Assessment letterConsists of appeal affidavit explaining grounds for appeal, and either

request for hearing before hearing officer or a waiver of appearanceHearing officer makes recommendation to BoardCommittee may argue before BoardBoard decision subject to judicial review to Appellate Court

If only 1 civil penalty in 2 years, then considered as having none

Judicial Review

Any party adversely affected by Board action (or inaction), may file for judicial review pursuant to the Administrative Review Law

Appeal is directly to Appellate CourtMust be filed within 7 days of Board order

May be waived with consent of all partiesBoard order not stayed unless ordered by

Appellate Court

Ballot Forfeiture

Any candidate whose committee has not paid a civil penalty imposed by the State Board of Elections shall not be certified for ballot

Database of Complaints FiledState Board of Elections to maintain

searchable Internet database of each complaint filed which the Board has found justifiable, including all Board actions and penalties imposed, if any

If complaint was found not to be justifiable, then it is not in database

Business Entity Registration for Procurement [I]Registration with State Board of Elections required if

business has existing contracts, bids on contracts not yet awarded, or combination thereof, in excess of $50,000

Disclosure of the name of entity, names of affiliated businesses, and names of affiliated personsAffiliated business is corporate parent or subsidiary of

entity, subsidiary of the corporate entity, IRS 501(c) organization established by entity or affiliated entity or affiliated person Does not include entity prohibited by federal law from

making contributions or expenditures in connection with federal, state or local elections

Business Entity Registration for Procurement [II]

Affiliated person is one with ownership interest in excess of 7.5%, or executive employees of entity (President, Chairman, CEO, employee) whose compensation is determined by attaining State contractsDoes not include persons prohibited by

federal law from making contributions or expenditures in connection with federal, state or local elections

Contributions ProhibitedAffected BEREP, affiliated entities, and affiliated

persons are prohibited from making contributions to political committeeIn case of awarded contracts in excess of $50,000, to

contracting officer or candidate for that office. Duration of prohibition is longer of the incumbent’s term or 2 years

In case of proposed contracts in excess of $50,000, to contracting officer. Duration is period from date bid is submitted and ending on date contract is awarded

Governor is considered officer for contracts with agencies directly controlled by him