Bill Summary – FastDemocracy

HOUSE BILL NO. 5250
     October 25, 2023, Introduced by Reps. Byrnes, Hill, Miller, MacDonell, Morgan, Stone, Wilson,
       Conlin, Andrews, Coffia, McFall, Skaggs, Price, Hope, Rheingans, Brixie, Paiz, Dievendorf,
       Brabec, McKinney, Martus and Arbit.
          A bill to regulate political activity; to require certain
    elected state officers to file financial reports; to prescribe the
    powers and duties of certain state officers and agencies; to impose
    fees; to prescribe penalties and civil sanctions; and to provide
    remedies.
                     THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
       Sec. 1. This act may be cited as the "executive office
 financial disclosure act".
       Sec. 2. As used in this act:
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       (a) "Beneficial interest" includes, but is not limited to, the
 interest in a trust of a qualified trust beneficiary or a trust
 beneficiary as those terms are defined in section 7103 of the
 estates and protected individuals code, 1998 PA 386, MCL 700.7103.
       (b) "Blind trust" means a qualified blind trust or qualified
 diversified trust as those terms are defined in 5 CFR 2634.403.
       (c) "Dependent" means an individual claimed by the state
 official or the state official's spouse as a dependent for federal
 income tax purposes.
       (d) "Earned income" means salaries, wages, tips, bonuses,
 commissions, or other compensation or net earnings from self-
 employment for the taxable year.
       (e) "Gift" means that term as defined in section 4 of 1978 PA
 472, MCL 4.414.
       (f) "Immediate family member" means the spouse or a dependent
 of the state official.
       (g) "Income" means money or any thing of value received, or to
 be received as a claim on future services, whether in the form of a
 fee, salary, expense, allowance, forbearance, forgiveness,
 interest, dividend, royalty, rent, capital gain, or any other form
 of recompense that is considered income under the internal revenue
 code of 1986, 26 USC 1 to 9834.
       (h) "Liabilities" means what a person owes to another person,
 including, but not limited to, mortgages or other debts. For
 purposes of this act, a debt does not include a revolving or
 unsecured debt that is from a financial institution or the federal
 government.
       (i) "Lobbyist" means that term as defined in section 5 of 1978
 PA 472, MCL 4.415.
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       (j) "Lobbyist agent" means that term as defined in section 5
 of 1978 PA 472, MCL 4.415.
       (k) "Person" means an individual, partnership, corporation,
 association, or other legal entity.
       (l) "Reporting period" means both of the following:
       (i) For the first report required to be filed under section 3,
 from January 1, 2024 to April 15, 2024.
       (ii) For subsequent reports required to be filed under section
 3, January 1 to December 31 of the preceding calendar year in which
 the report is filed.
       (m) "Spouse" means an individual who is lawfully married to
 the state official as described under 26 CFR 301.7701-18.
       (n) "State official" means an individual who is serving in any
 of the following offices:
       (i) Governor.
       (ii) Lieutenant governor.
       (iii) Secretary of state.
       (iv) Attorney general.
       (o) "Unearned income" means income that is not earned from
 employment, including, but not limited to, inheritance money,
 financial prize, unemployment benefits, annuities, stock dividends,
 deferred compensation, pension, profit sharing, or retirement
 income.
       Sec. 3. (1) An individual who is a state official at any time
 during a calendar year shall electronically file with the secretary
 of state a report that meets the requirements of section 4. The
 report required to be filed under this subsection must first be
 filed by April 15, 2024 and by May 15 of each year thereafter. This
 subsection does not apply to an individual who was a state official
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 only on the first day of the calendar year or who, under any of the
 following acts, files a report in the current calendar year:
        (a) State board of education financial disclosure act.
        (b) Candidate for the state board of education financial
 disclosure act.
        (c) Candidate for executive office financial disclosure act.
        (d) State representative financial disclosure act.
        (e) Candidate for state representative financial disclosure
 act.
        (f) State senator financial disclosure act.
        (g) Candidate for state senator financial disclosure act.
        (h) University board member financial disclosure act.
        (i) Candidate for university board member financial disclosure
 act.
        (2) If a state official who is required to file a report under
 this act receives notice from the secretary of state under section
 6(1)(g), the state official shall, within 9 business days after
 receiving the notice, file corrections to the errors or omissions
 or file the report, as applicable.
        Sec. 4. (1) Subject to subsection (4) and except as provided
 in section 5, a report required under section 3 must include a
 complete statement of all of the following:
        (a) The following information regarding the state official
 during the reporting period:
        (i) The full name, mailing address, and occupation of the state
 official.
        (ii) The name, address, and principal activity of each employer
 of the state official.
        (iii) The source and type of all income, including earned and
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 unearned income, received by the state official. For purposes of
 this subparagraph, the state official shall report a source of
 income only if the income received from that source is $1,000.00 or
 more and indicate whether the amount of income received from each
 source of income is between $1,000.00 and $49,999.99 or $50,000.00
 or more.
       (iv) A description of each real property or property that the
 state official has an ownership interest in, including, but not
 limited to, commercial, industrial, or agricultural buildings. For
 purposes of this subparagraph, the state official is required to
 include a real property or property described under this
 subparagraph in the report only if that real property or property
 has a fair market value of $1,000.00 or more during the reporting
 period. A state official may exclude the street number of a parcel
 of real property or property listed under this subparagraph.
       (v) A description of any stocks, bonds, commodities, futures,
 shares in mutual funds, or other forms of securities defined under
 26 USC 1236 held by the state official or held jointly with the
 state official's spouse. For purposes of this subparagraph, the
 state official is required to include a security described under
 this subparagraph in the report only if that security has a total
 value of $1,000.00 or more on a specified day that is within the
 final month of the calendar year covered in the reporting period.
       (vi) A description of all liabilities owed by the state
 official and the identity of each creditor. For purposes of this
 subparagraph, the state official is required to report a liability
 under this subparagraph only if the liability owed to a creditor is
 $1,000.00 or more during that reporting period.
       (vii) The identity of all compensated positions held by the
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 state official as an officer, director, member, trustee, partner,
 proprietor, representative, employee, or consultant of a
 corporation, limited liability company, limited partnership,
 partnership, or other business enterprise; of a nonprofit
 organization; of a labor organization; or of an educational
 institution or other institution other than this state, if the
 total compensation received from a position equals $1,000.00 or
 more during the reporting period. A position reported under this
 subparagraph must include the title of the position, the name of
 the entity within which the position exists, and the principal
 activity of the entity. A position held in any religious, social,
 fraternal, or political entity, or a position that is solely of an
 honorary nature, is excluded under this subparagraph.
       (viii) The date, parties to, and general terms of any agreements
 or arrangements with respect to future employment, a leave of
 absence while serving as a state official, continuation or deferral
 of payments by a former or current employer other than this state,
 or continuing participation in an employee welfare or benefit plan
 maintained by a former employer.
       (ix) A list of all gifts and expenditures for food and
 beverages reported by a lobbyist or lobbyist agent under state law.
       (x) A list of all travel and expenses paid for or reimbursed
 by a lobbyist or lobbyist agent that are reported by the lobbyist
 or lobbyist agent under state law.
       (xi) A description of each payment made by a lobbyist or
 lobbyist agent to a charity in lieu of honoraria.
       (xii) If the state official filing the report or an immediate
 family member of that state official was required during the
 reporting period to register as a lobbyist or lobbyist agent under
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 section 7 of 1978 PA 472, MCL 4.417, the name, address, and
 principal activity of all persons who gave compensation to or
 reimbursed the state official or the state official's immediate
 family member for lobbying.
         (xiii) A description of any interest the state official had
 during the reporting period in a legal entity that conducts
 business in this state, if the interest has a book value of
 $1,000.00 or more. For purposes of this subparagraph, the state
 official shall indicate for each legal entity the state official
 has an interest in the name of the legal entity and if the
 financial value in the legal entity is between $1,000.00 and
 $49,999.99 or $50,000.00 and more.
         (xiv) A description of all contracts entered into, or in which
 the state official or the state official's immediate family member
 has an interest, with this state.
         (xv) A description of any employment that the state official or
 the state official's immediate family member had with this state at
 any time during the reporting period. For purposes of this
 subparagraph, if the state official or the state official's
 immediate family member was employed by this state, the name of the
 state agency or department and a description of the position with
 the state agency or department must be included.
         (xvi) A description of any transfers made by the state official
 of real property or securities from the state official's name into
 the name of an immediate family member of the state official over
 the previous 2 calendar years that have a value of $50,000.00 or
 more.
         (b) Beginning January 1, 2028, the following information
 regarding the spouse of the state official during the reporting
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 period:
       (i) The name of the spouse of the state official.
       (ii) The principal activity of the spouse of the state
 official, if the spouse's total earned income from the employer
 equals $50,000.00 or more during that reporting period.
       (iii) The source and type of all income, including earned and
 unearned income received by the spouse of the state official. For
 purposes of this subparagraph, the spouse of the state official is
 required to include the source of income described under this
 subparagraph only if the total income from that source equals
 $50,000.00 or more during that reporting period.
       (iv) A description of each real property or property that the
 spouse of the state official has an ownership interest in,
 including, but not limited to, commercial, industrial, or
 agricultural buildings. For purposes of this subparagraph, the
 spouse of the state official is required to include a real property
 or property described under this subparagraph in the report only if
 the real property or property had a fair market value of $50,000.00
 or more at any time the real property was held during that
 reporting period. The street number of a parcel of real property
 listed under this subparagraph may be excluded from the report.
       (v) A description of any stocks, bonds, commodities, futures,
 shares in mutual funds, or other forms of securities held by the
 spouse of the state official. For purposes of this subparagraph,
 the spouse of the state official is required to include a security
 described under this subparagraph in the report only if the
 security has a total aggregate fair market value of $50,000.00 or
 more on a specified day that is within the final month of the
 calendar year covered in the reporting period.
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       (vi) A description of any interest the spouse of the state
 official had during the reporting period in a legal entity that
 conducts business in this state, if the interest has a book value
 of $50,000.00 or more.
       (c) Beginning January 1, 2028, the following information
 regarding a dependent of the state official during the reporting
 period; for purposes of this subdivision, the state official may
 refer to each dependent using the dependent's first and last
 initial:
       (i) The number of dependents that the state official and the
 spouse of the state official claim for federal income tax purposes.
       (ii) The principal activity of each employer of each dependent
 of the state official, if the dependent's total earned income from
 the employer equals $50,000.00 or more during the reporting period.
       (iii) The source and type of all income, including earned and
 unearned income received by each dependent of the state official,
 if the source of income described under this subparagraph equals
 $50,000.00 or more during that reporting period.
       (iv) A description of each real property or property that each
 dependent of the state official has an ownership interest in,
 including, but not limited to, commercial, industrial, or
 agricultural buildings. For purposes of this subparagraph, the
 dependent is required to include a real property or property
 described under this subsection only if the real property or
 property had a fair market value of $50,000.00 or more at any time
 that the real property or property was held during that reporting
 period. The street number of a parcel of real property or property
 listed under this subparagraph may be excluded from the report.
       (v) A description of any stocks, bonds, commodities, futures,
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 shares in mutual funds, or other forms of securities held by each
 dependent of the state official. For purposes of this subparagraph,
 each dependent of the state official is required to include a
 security described under this subparagraph in the report only if
 the security has a total aggregate fair market value of $50,000.00
 or more on a specified day that is within the final month of the
 calendar year covered in the reporting period.
       (vi) A description of any interest each dependent of the state
 official had during the reporting period in a legal entity that
 conducts business in this state, if the interest has a book value
 of $50,000.00 or more.
       (2) Subject to subsection (4), information a state official is
 required to report under this section includes information with
 respect to the income from a trust or other financial arrangement
 from which income is received by, or with respect to which a
 beneficial interest in principal or income is held by, the state
 official required to file a report under this section or that state
 official's immediate family member.
       (3) A state official is not required to disclose the value of
 any item reported under subsection (1)(a)(iii),(iv) to (vii),(xiii), or
 (xvi), (1)(b)(iii), or (iv) to (vi), or (1)(c)(iii), or (iv) to (vi).
       (4) If a state official required to file a report under
 section 3 or that state official's immediate family member holds a
 beneficial interest in a blind trust, the state official is not
 required to include the interests or assets of the blind trust in
 the state official's statement under subsection (1). However,