Bill Summary – FastDemocracy

Enrolled Copy                                                                               H.B. 160
                             CAMPAIGN FUNDING AMENDMENTS
                                           2024 GENERAL SESSION
                                                STATE OF UTAH
                                     Chief Sponsor: Jordan D. Teuscher Senate Sponsor: Evan J. Vickers
 2
  LONG TITLE
  General Description:
      This bill amends provisions relating to clothing expenses for which campaign funds may be
  used.
  Highlighted Provisions:
      This bill:
      ▸ clarifies that an officeholder may use campaign funds for clothing bearing the logo or
  name of a jurisdiction, district, government organization, government entity, caucus, or
  political party that the officeholder represents or of which the officeholder is a member; and
      ▸ modifies the definition of "personal use expenditure" in relation to municipalities and
  counties to make the permitted uses of campaign funds for clothing consistent with the uses
  permitted under the Election Code.
  Money Appropriated in this Bill:
      None
  Other Special Clauses:
      None
  Utah Code Sections Affected:
  AMENDS:
      10-3-209, as last amended by Laws of Utah 2019, Chapter 204
      17-16-202, as last amended by Laws of Utah 2019, Chapters 155, 204
      20A-11-104, as last amended by Laws of Utah 2021, Chapter 20
24
  Be it enacted by the Legislature of the state of Utah:
          Section 1. Section 10-3-209 is amended to read:
          10-3-209 . Personal use expenditure -- Authorized and prohibited uses of
  campaign funds -- Enforcement -- Penalties.
     H.B. 160                                                                                  Enrolled Copy
   (1) Unless a municipality adopts by ordinance more stringent definitions, the following are
       defined terms for the purposes of this section:
       (a) "Candidate" means a person who:
            (i) files a declaration of candidacy for municipal office; or
            (ii) receives contributions, makes expenditures, or gives consent for any other person
                to receive contributions or make expenditures to bring about the person's
                nomination or election to a public office.
       (b) "Officeholder" means a person who is elected to and currently holds a municipal
            office.
       (c) (i) "Personal use expenditure" means an expenditure that:
                (A) is not excluded from the definition of personal use expenditure by Subsection
                      (2) and primarily furthers a personal interest of a candidate or officeholder or a
                      candidate's or officeholder's family, which interest is not connected with the
                      performance of an activity as a candidate or an activity or duty of an
                      officeholder; or
                (B) would cause the candidate or officeholder to recognize the expenditure as
                      taxable income under federal law.
            (ii) "Personal use expenditure" includes:
                (A) a mortgage, rent, utility, or vehicle payment;
                (B) a household food item or supply;
                (C) a clothing expense, except:
                      [(C)] (I) [clothing, except for ]clothing bearing the candidate's name or
                          campaign slogan or logo [and ]that is used in the candidate's campaign;
                      (II) clothing bearing the logo or name of a jurisdiction, district, government
                          organization, government entity, caucus, or political party that the
                          officeholder represents or of which the officeholder is a member; or
                      (III) repair or replacement of clothing that is damaged while the candidate or
                          officeholder is engaged in an activity of a candidate or officeholder;
                (D) an admission to a sporting, artistic, or recreational event or other form of
                      entertainment;
                (E) dues, fees, or gratuities at a country club, health club, or recreational facility;
                (F) a salary payment made to a candidate, officeholder, or a person who has not
                      provided a bona fide service to a candidate or officeholder;
                (G) a vacation;
                                                       -2-
     Enrolled Copy                                                                                 H.B. 160
              (H) a vehicle expense;
              (I) a meal expense;
              (J) a travel expense;
              (K) a payment of an administrative, civil, or criminal penalty;
              (L) a satisfaction of a personal debt;
              (M) a personal service, including the service of an attorney, accountant, physician,
                   or other professional person;
              (N) a membership fee for a professional or service organization; and
              (O) a payment in excess of the fair market value of the item or service purchased.
  (2) As used in this section, "personal use expenditure" does not mean an expenditure made:
      (a) for a political purpose;
      (b) for candidacy for public office;
      (c) to fulfill a duty or activity of an officeholder;
      (d) for a donation to a registered political party;
      (e) for a contribution to another candidate's campaign account, including sponsorship of
          or attendance at an event, the primary purpose of which is to solicit a contribution for
          another candidate's campaign account;
      (f) to return all or a portion of a contribution to a donor;
      (g) for the following items, if made in connection with the candidacy for public office or
          an activity or duty of an officeholder:
          (i) (A) a mileage allowance at the rate established by the Division of Finance
              under Section 63A-3-107; or
              (B) for motor fuel or special fuel, as defined in Section 59-13-102;
          (ii) a meal expense;
          (iii) a travel expense, including an expense incurred for airfare or a rental vehicle;
          (iv) a payment for a service provided by an attorney or accountant;
          (v) a tuition payment or registration fee for participation in a meeting or conference;
          (vi) a gift;
          (vii) a payment for the following items in connection with an office space:
              (A) rent;
              (B) utilities;
              (C) a supply; or
              (D) furnishing;
          (viii) a booth at a meeting or event; or
                                                       -3-
      H.B. 160                                                                                 Enrolled Copy
              (ix) educational material;
       (h) to purchase or mail informational material, a survey, or a greeting card;
       (i) for a donation to a charitable organization, as defined by Section 13-22-2, including
              admission to or sponsorship of an event, the primary purpose of which is charitable
              solicitation, as defined in Section 13-22-2;
       (j) to repay a loan a candidate makes from the candidate's personal account to the
              candidate's campaign account;
       (k) to pay membership dues to a national organization whose primary purpose is to
              address general public policy;
       (l) for admission to or sponsorship of an event, the primary purpose of which is to
              promote the social, educational, or economic well-being of the state or the candidate's
              or officeholder's community;
       (m) for one or more guests of an officeholder or candidate to attend an event, meeting,
              or conference described in this Subsection (2); or
       (n) to pay childcare expenses of:
              [(A)] (i) a candidate while the candidate is engaging in campaign activity; or
              [(B)] (ii) an officeholder while the officeholder is engaging in the duties of an
                  officeholder.
   (3) (a) A municipality may adopt an ordinance prohibiting a personal use expenditure by
       a candidate with requirements that are more stringent than the requirements provided
       in Subsection (4).
       (b) The municipality may adopt definitions that are more stringent than those provided
              in Subsection (1) or (2).
       (c) If a municipality fails to adopt a personal use expenditure ordinance described in
              Subsection (3)(a), a candidate shall comply with the requirements contained in
              Subsection (4).
   (4) A candidate or an officeholder may not use money deposited into a campaign account
       for:
       (a) a personal use expenditure; or
       (b) an expenditure prohibited by law.
   (5) A municipality may enforce this section by adopting an ordinance:
       (a) to provide for the evaluation of a campaign finance statement to identify a personal
              use expenditure; and
       (b) to commence informal adjudicative proceedings if, after an evaluation described in
                                                         -4-
      Enrolled Copy                                                                                  H.B. 160
          Subsection (5)(a), there is probable cause to believe that a candidate or officeholder
          has made a personal use expenditure.
  (6) If, in accordance with the proceedings described in Subsection (5)(b) established in
      municipal ordinance, a municipality determines that a candidate or officeholder has
      made a personal use expenditure, the municipality:
      (a) may require the candidate or officeholder to:
          (i) remit an administrative penalty of an amount equal to 50% of the personal use
              expenditure to the municipality; and
          (ii) deposit the amount of the personal use expenditure into the campaign account
              from which the personal use expenditure was disbursed; and
      (b) shall deposit the money received under Subsection (6)(a)(i) into the municipal
          general fund.
        Section 2. Section 17-16-202 is amended to read:
        17-16-202 . Definitions.
       As used in this part:
  (1) (a) Except as provided in Subsection (1)(b), "contribution" means any of the
      following when done for a political purpose:
          (i) a gift, subscription, donation, loan, advance, deposit of money, or anything of
              value given to the filing entity;
          (ii) an express, legally enforceable contract, promise, or agreement to make a gift,
              subscription, donation, unpaid or partially unpaid loan, advance, deposit of
              money, or anything of value to the filing entity;
          (iii) any transfer of funds from another reporting entity to the filing entity;
          (iv) compensation paid by any person or reporting entity other than the filing entity
              for personal services provided without charge to the filing entity;
          (v) a loan made by a county office candidate or local school board candidate
              deposited into the county office candidate's or local school board candidate's own
              campaign account; or
          (vi) an in-kind contribution.
      (b) "Contribution" does not include:
          (i) services provided by an individual volunteering a portion or all of the individual's
              time on behalf of the filing entity if the services are provided without
              compensation by the filing entity or any other person;
          (ii) money lent to the filing entity by a financial institution in the ordinary course of
                                                       -5-
      H.B. 160                                                                                  Enrolled Copy
                business; or
            (iii) goods or services provided for the benefit of a county office candidate or local
                school board candidate at less than fair market value that are not authorized by or
                coordinated with the county office candidate or the local school board candidate.
   (2) "County office" means an office described in Section 17-53-101 that is required to be
       filled by an election.
   (3) "County office candidate" means an individual who:
       (a) files a declaration of candidacy for a county office; or
       (b) receives a contribution, makes an expenditure, or gives consent for any other person
            to receive a contribution or make an expenditure to bring about the individual's
            nomination or election to a county office.
   (4) "County officer" means an individual who holds a county office.
   (5) (a) Except as provided in Subsection (5)(b), "expenditure" means any of the
       following made by a reporting entity or an agent of a reporting entity on behalf of the
       reporting entity:
            (i) any disbursement from contributions, receipts, or the separate bank account
                required under Section 17-16-6.5;
            (ii) a purchase, payment, donation, distribution, loan, advance, deposit, gift of money,
                or anything of value made for a political purpose;
            (iii) an express, legally enforceable contract, promise, or agreement to make any
                purchase, payment, donation, distribution, loan, advance, deposit, gift of money,
                or anything of value for a political purpose;
            (iv) compensation paid by a filing entity for personal services rendered by a person
                without charge to a reporting entity;
            (v) a transfer of funds between the filing entity and a county office candidate's, or a
                local school board candidate's, personal campaign committee; or
            (vi) goods or services provided by the filing entity to or for the benefit of another
                reporting entity for a political purpose at less than fair market value.
       (b) "Expenditure" does not include:
            (i) services provided without compensation by an individual volunteering a portion or
                all of the individual's time on behalf of a reporting entity;
            (ii) money lent to a reporting entity by a financial institution in the ordinary course of
                business; or
            (iii) anything described in Subsection (5)(a) that is given by a reporting entity to a
                                                       -6-
      Enrolled Copy                                                                                   H.B. 160
              candidate or officer in another state.
  (6) "Filing entity" means:
      (a) a county office candidate;
      (b) a county officer;
      (c) a local school board candidate;
      (d) a local school board member; or
      (e) a reporting entity that is required to meet a campaign finance disclosure requirement
          adopted by a county in accordance with Section 17-16-6.5.
  (7) "In-kind contribution" means anything of value, other than money, that is accepted by or
      coordinated with a filing entity.
  (8) "Local school board candidate" means an individual who:
      (a) files a declaration of candidacy for local school board; or
      (b) receives a contribution, makes an expenditure, or gives consent for any other person
          to receive a contribution or make an expenditure to bring about the individual's
          nomination or election to a local school board.
  (9) (a) "Personal use expenditure" means an expenditure that:
          (i) (A) is not excluded from the definition of personal use expenditure by
              Subsection (9)(c); and
              (B) primarily furthers a personal interest of a county office candidate, county
                   officer, local school board candidate, or a local school board member, or a
                   member of a county office candidate's, county officer's, local school board
                   candidate's, or local school board member's family; or
          (ii) would cause the county office candidate, county officer, local school board
              candidate, or local school board member to recognize the expenditure as taxable
              income under federal law.
      (b) "Personal use expenditure" includes:
          (i) a mortgage, rent, utility, or vehicle payment;
          (ii) a household food item or supply;
          (iii) a clothing expense, except:
              (A) clothing bearing the county office candidate's or local school board
                   candidate's name or campaign slogan or logo that is used in the county office
                   candidate's or local school board candidate's campaign;
              (B) clothing bearing the logo or name of a jurisdiction, district, government
                   organization, government entity, caucus, or political party that the county
                                                      -7-
      H.B. 160                                                                                  Enrolled Copy
                    officer or local school board member represents or of which the county officer
                    or local school board member is a member;
235