HB2546 - 521R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 16-914.02, Arizona Revised Statutes, is amended to read:

START_STATUTE16-914.02. Reporting independent expenditures of corporations, limited liability companies and labor organizations; statement; disclaimer and disclosure; civil action; civil penalty; violation; classification; definitions

A. Any corporation, limited liability company or labor organization that makes cumulative independent expenditures in an attempt to influence the outcome of a candidate election and in at least the following amounts in an election cycle shall register and notify the appropriate filing officer not later than one day after making that expenditure, excluding Saturdays, Sundays and other legal holidays:

1. An aggregate of five thousand dollars or more in one or more statewide races.

2. An aggregate of two thousand five hundred dollars or more in one or more legislative races.

3. One thousand dollars or more in one or more county, city, town or other local races if the one thousand dollars is aggregated in races in a single county, city, town or other local jurisdiction.

B. The secretary of state is the filing officer for registrations and notifications for independent expenditures in statewide and legislative elections. City, town or county filing officers are the filing officers for notifications in a city, town, county or other local election as provided in section 16‑916. The corporation, limited liability company or labor organization also shall notify the filing officer within the same time limit prescribed in subsection A of this section of each additional accumulation of expenditures that exceeds the threshold amount prescribed in subsection A of this section but is not required to register again during that election cycle after the initial registration. A corporation, limited liability company or labor organization may register with the filing officer and provide a notarized, sworn statement of authority in advance of the expenditure in anticipation of making an independent expenditure. The secretary of state shall provide for electronic filing for registrations and notifications and shall provide for website access to the information for the public. Filings at the secretary of state's office shall be in the form prescribed by the secretary of state. Other filing officers shall prescribe the format for filing registrations and notifications and shall provide for public access to that information. On or after November 27, 2012 and at the request of the local election filing officer, the secretary of state may provide for electronic filing pursuant to this section for local elections.

C. The registration shall include all of the following:

1. The name and address of the corporation, limited liability company or labor organization.

2. The name, title, electronic mail address and telephone number of the person authorizing the independent expenditure.

D. Each notification shall include all of the following:

1. The name and address of the corporation, limited liability company or labor organization making the independent expenditure.

2. The amount of the expenditure and the name of the vendor or other payee receiving the expenditure.

3. The name of the candidate and race in which the expenditure was made and whether the expenditure was in support of or opposition to the candidate.

4. The communication medium and description of what was purchased with the expenditure.

5. The date of the expenditure.

E. If the corporation, limited liability company or labor organization did not register and provide a notarized sworn statement in advance of the expenditure as prescribed by this section, the corporation, limited liability company or labor organization shall file with the secretary of state or other appropriate filing officer within five days after an initial threshold expenditure as prescribed in subsection A of this section a notarized sworn statement that the person, agent or officer filing the registration and notice had authority to make that expenditure on behalf of the corporation, limited liability company or labor organization. Until the secretary of state or other filing officer receives the notarized sworn statement, the filing officer shall categorize the notification as unverified. If the secretary of state or other filing officer does not receive the notarized sworn statement within the required five day time frame, the notification shall be categorized as both unverified and delinquent. The filing officer shall make reasonable efforts to contact the entity that made the expenditure and remove the notification from public view within a reasonable time if unable to verify that the entity made the expenditure and all penalties prescribed in this section apply.

F. Any literature or advertisement that is purchased with monies from a corporation, limited liability company or labor organization making an independent expenditure in an attempt to influence the outcome of a candidate an election shall disclose the name of the corporation, limited liability company or labor organization making the expenditure. Any disclosure statement required by this section shall be printed clearly and legibly in a conspicuous manner. The disclosure statement shall include the words "paid for by" followed by the name of the entity making the expenditure and shall state that it is not authorized by any candidate or candidate's campaign committee. The disclosure statement shall include the four largest of its major funding sources as of the time the literature or advertisement is printed, recorded or otherwise produced for dissemination. If an out‑of‑state contributor or group of out-of-state contributors is a major funding source to the corporation, limited liability company or labor organization, the disclosure statement shall state the contributor is an out‑of-state contributor. Disclosure statements shall also comply with the following:

1. If the communication is broadcast on radio, the information disclosure shall be spoken at the end of the communication.

2. If the communication is printed material that is delivered or provided by hand or by mail, the disclosure shall be printed clearly and legibly in a conspicuous manner.

3. If the communication is broadcast on a telecommunications system, the following apply:

(a) The information disclosure shall be both written and spoken at the end of the communication, except that if the written disclosure statement is written displayed for at least five seconds of a thirty second advertisement communications broadcast or ten seconds of a sixty second advertisement communications broadcast, a spoken disclosure statement is not required.

(b) If the communication is broadcast on a telecommunications system, The written disclosure statement shall be printed in letters that are displayed in a height that is equal to or larger than four per cent percent of the vertical picture height. The literature or advertisement shall include the words "paid for by" in the disclosure followed by the name of the entity making the expenditure and shall also state that it is not authorized by any candidate or candidate's campaign committee.

G. Subsection F of this section does not apply to bumper stickers, pins, buttons, pens and similar small items on which the statements required in subsection F of this section cannot be conveniently printed or to a communication by an organization solely to its members.

H. Any corporation, limited liability company or labor organization that fails to register, notify or disclose as required by this section is liable in a civil action pursuant to section 16‑924 brought by the attorney general, county attorney or city or town attorney, as appropriate, for a civil penalty of up to three times the total amount of the expenditure.

I. Any person who makes a knowingly false filing relating to an independent expenditure pursuant to this section is guilty of a class 1 misdemeanor.

J. For violations that occur before November 27, 2012, a reasonable cause determination for a violation of this section may only be made by the secretary of state's office and not by any other filing officer. On or after November 27, 2012, the local election jurisdiction and filing officers may make their own reasonable cause determinations for violations of this section or may elect to continue to have the office of the secretary of state make those reasonable cause determinations on their behalf. A civil or criminal enforcement action may not be filed until after the issuance of a reasonable cause determination.

K. Any entity corporation, limited liability company or labor organization that makes an independent expenditure and that is organized primarily for the purpose of influencing an election and that is a combination of corporations, limited liability companies or labor organizations or that is a corporation, limited liability company or labor organization that accepts donations or contributions shall file campaign finance reports pursuant to section 16-915, subsection A, paragraph 2 with the filing officer as a political committee as otherwise provided by law.

L. For the purposes of this section, an expenditure occurs on the date on which literature or advertisements are deposited at the post office for mailing, submitted to a communications system for broadcast or submitted to a newspaper or similar print medium for printing and, with respect to an expenditure for signs, the date on which a sign is first posted.

M. For the purposes of this section:

1. "Independent expenditure" has the same meaning prescribed in section 16‑901, except that it is made by a corporation, a limited liability company or a labor organization and except as prescribed in subsection L of this section.

2. "Local election" means an election in a county, city, town, school district or special district.