SB1432 - 541R

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

Section 1. Title 16, chapter 6, article 1.7, Arizona Revised Statutes, is amended by adding section 16-939, to read:

START_STATUTE16-939. Arizona election and ethics commission; secretary of state; campaign finance duties

Beginning in 2020, the Arizona election and ethics commission established pursuant to title 41, chapter 4, article 8 shall succeed to the duties of the secretary of state with respect to acting as the investigatory, compliance and enforcement officer for committees supporting or opposing the recall of a public officer elected statewide or to the legislature, supporting or opposing the circulation of petitions for ballot measures, questions and propositions appearing on a state general election ballot or recall of public officials elected statewide or to the legislature or supporting or opposing candidates for state offices and members of the legislature and for a statewide initiative or referendum or any measure or proposition appearing on a state general election ballot. END_STATUTE

Sec. 2. Title 41, chapter 4, Arizona Revised Statutes, is amended by adding article 8, to read:

ARTICLE 8. ARIZONA ELECTION AND ETHICS COMMISSION

START_STATUTE41-811. Arizona election and ethics commission; members; terms; meetings; compensation

A. The Arizona election and ethics commission is established consisting of six members. The governor shall appoint one member and the highest ranking official holding a statewide office who is not a member of the same political party as the governor shall appoint the next member. Thereafter, the highest ranking member of the majority party in the house of representatives shall appoint one member, followed by the highest ranking member of the minority party in the house of representatives, who shall appoint one member, followed by the highest ranking member of the majority party in the state senate, who shall appoint one member, followed by the highest ranking member of the minority party in the state senate, who shall appoint one member.

B. Any vacancy on the commission shall be filled by an appointment by the then current holder of the office designated to make the appointment.

C. During the five‑year period immediately before taking office and for the duration of the member's term of office, a member may not seek or accept nomination, election or appointment to any elected public office or serve on a committee supporting or opposing any initiative, referendum or other measure to be submitted to a vote of the people at the time the member is serving on the commission.

D. Members may not be employed by this state.

E. Members shall serve four-year terms beginning on the third Monday in January.

F. The commission shall meet at the call of the chairperson or on the written request of a majority of the members. Approval by at least four members of the commission is required for the commission to act.

G. Members are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2. END_STATUTE

START_STATUTE41-811.01. Commission powers and duties relating to campaign finance and disclosure laws; civil penalty; enforcement

A. The Arizona election and ethics commission shall:

1. Appoint an executive director.

2. On request, issue advisory opinions regarding campaign finance, ethics and disclosure laws to candidates for state public office and to committees supporting or opposing any initiative, referendum or other measure to be submitted to a statewide vote of the public.

3. Adopt, amend or repeal rules pursuant to chapter 6 of this title to carry out the purposes of this article, title 16, chapter 6, articles 1, 1.1, 1.2, 1.3, 1.4, 1.5, 1.6 and 1.7 and sections 18-444, 38‑541 and 38-543.

4. Conduct investigations and audits as the result of any complaint brought before the commission by a member of the public, a candidate for state public office or a committee supporting or opposing any initiative, referendum or other measure to be submitted to a statewide vote of the public.

5. Conduct a hearing pursuant to chapter 6 of this title if the commission determines after an investigation that a hearing is warranted.

6. Impose a civil penalty of not more than five thousand dollars for any violation of title 16, chapter 6, articles 1, 1.1, 1.2, 1.3, 1.4, 1.5, 1.6 and 1.7 or sections 18-444, 38‑541 and 38-543.

B. The Arizona election and ethics commission or a member of the commission may:

1. Administer oaths, examine witnesses and receive evidence relating to an investigation or hearing conducted pursuant to this section.

2. Issue and enforce subpoenas compelling the attendance and testimony of witnesses or demanding the production of physical evidence relating to an investigation or hearing conducted pursuant to this section.

C. The attorney general shall enforce this article, title 16, chapter 6, articles 1, 1.1, 1.2, 1.3, 1.4, 1.5, 1.6 and 1.7 and sections 18-444, 38‑541 and 38-543 through civil and criminal actions.

D. The commission shall use the following procedures to investigate a complaint filed pursuant to this section:

1. The commission shall notify by certified mail the person against whom a complaint has been filed within two business days after receiving the complaint. The notice shall include a copy of the complaint, any supporting documentation accompanying the complaint and a copy of this section.

2. Within seven days after mailing the notice, the person against whom a complaint has been filed may file a response with the commission.

3. On receipt of the response or the expiration of the seven-day period, whichever is sooner, the commission, by majority vote, shall either dismiss the complaint within seven days or proceed with a formal investigation. If the complaint is dismissed, the complaint and answer shall be kept confidential. If the commission votes to proceed with a formal investigation, the person against whom a complaint has been filed shall be notified by certified mail, a formal hearing date shall be set and the complaint and answer shall be made public. A formal hearing shall begin at least five days but not more than twenty days after the notice is mailed.

4. Failure to file an answer may not be deemed to be an admission or to create an inference or presumption that the complaint is true.

5. By majority vote, the commission may modify the time periods contained in this subsection. END_STATUTE

START_STATUTE41-811.02. Ethics enforcement; rules; penalties; definition

A. The Arizona election and ethics commission may receive any ethics complaint filed against a candidate for statewide or legislative office, or against an elected official of state government, including the legislature. Members of the public may file Complaints. Complaints filed with the commission must be in writing and signed by the complainant.

B. The Arizona election and ethics commission may investigate and make recommendations to appropriate civil and criminal enforcement agencies regarding any of the following:

1. Violation of campaign finance, financial disclosure or conflict of interest laws.

2. Violation of laws regarding employment of relatives or prohibited personnel practices.

3. Nonfeasance, misfeasance or malfeasance in office.

4. Other ethical or statutory violations.

C. The Arizona election and ethics commission may not conduct investigations involving the following:

1. The conduct or results of a specific election.

2. Disputes relating to the election and qualification of any member of the legislature.

3. The conduct of any judicial officer of this state.

D. In interpreting the restrictions contained in subsection C of this section, the commission shall observe the separation of powers under article III, Constitution of Arizona.

E. The commission shall use the following procedures to investigate a complaint filed pursuant to this section:

1. The commission shall notify by certified mail the person against whom a complaint has been filed within two business days after receiving the complaint. The Notice shall include a copy of the complaint, any supporting documentation accompanying the complaint and a copy of the text of this section.

2. Within seven days after mailing the notice, the person against whom a complaint has been filed may file a response with the commission.

4. Failure to file an answer may not be deemed to be an admission or to create an inference or presumption that the complaint is true.

5. By majority vote, the commission may modify the time periods contained in this subsection.

F. The Arizona election and ethics commission may:

1. Issue and enforce subpoenas compelling the attendance and testimony of witnesses or demanding the production of physical evidence relating to an investigation conducted pursuant to this section.

2. After the investigation of a complaint, impose civil penalties of not more than $5,000 for any violation of this article.

3. After the investigation of a complaint, forward the complaint to the appropriate law enforcement agency if the commission determines that such action is warranted.

G. Decisions rendered by the commission may be appealed to the superior court.

H. For the purposes of this section, "ethics complaint" means a complaint brought before the Arizona election and ethics commission against a candidate for public office, a committee supporting or opposing any initiative, referendum or other measure to be submitted to a statewide vote of the public or an elected official of state government, including the legislature, that alleges an ethical or statutory violation. END_STATUTE

START_STATUTE41-811.03. Legal advice and assistance

The attorney general shall provide an attorney to render legal advice and assistance to the Arizona election and ethics commission. Notwithstanding section 41‑192, the commission may hire independent counsel in place of the attorney general. END_STATUTE

START_STATUTE41-811.04. Secretary of state; access to filings

The secretary of state shall cooperate with and provide shared access to the Arizona election and ethics commission for all campaign finance filings and financial disclosure filings over which the Arizona election and ethics commission has jurisdiction as prescribed by this article. END_STATUTE

Sec. 3. Title 41, chapter 27, article 2, Arizona Revised Statutes, is amended by adding section 41-3029.01, to read:

START_STATUTE41-3029.01. Arizona election and ethics commission; termination July 1, 2029

A. The Arizona election and ethics commission terminates on July 1, 2029.

B. Title 41, chapter 4, article 8 and this section are repealed on January 1, 2030. END_STATUTE

Sec. 4. Purpose

Pursuant to section 41-2955, subsection E, Arizona Revised Statutes, the legislature establishes the Arizona election and ethics commission to act as the investigatory, compliance and enforcement officer for election‑related matters.

Sec. 5. Conforming legislation

The legislative council staff shall prepare proposed legislation conforming the Arizona Revised Statutes to the provisions of this act for consideration in the fifty-fourth legislature, second regular session.