SB0042

SENATE BILL 42

56th legislature - STATE OF NEW MEXICO - first session, 2023

INTRODUCED BY

Peter Wirth and Katy M. Duhigg and Matthew McQueen

AN ACT

RELATING TO CAMPAIGN FINANCE; AMENDING THE CAMPAIGN REPORTING ACT; REQUIRING DISCLOSURES RELATING TO ELECTRONIC COMMUNICATIONS; CLARIFYING AND CHANGING CERTAIN REQUIREMENTS RELATING TO CONTRIBUTIONS AND DONATIONS; AMENDING CERTAIN REPORTING REQUIREMENTS; PROHIBITING USING CAMPAIGN FUNDS TO REPAY LOANS MADE BY THE CANDIDATE THAT ARE SUBJECT TO A RATE OF INTEREST; AMENDING PROVISIONS RELATED TO FUNDRAISING DURING LEGISLATIVE SESSIONS.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

SECTION 1. Section 1-19-26 NMSA 1978 (being Laws 1979, Chapter 360, Section 2, as amended) is amended to read:

"1-19-26. DEFINITIONS.--As used in the Campaign Reporting Act:

A. "advertisement" means a communication referring to a candidate or ballot question that is published, disseminated, distributed or displayed to the public by print, broadcast, satellite, cable or electronic media, including recorded phone messages, or by printed materials, including mailers, handbills, signs and billboards, but "advertisement" does not include:

(1) a communication by a membership organization or corporation to its current members, stockholders or executive or administrative personnel;

(2) a communication appearing in a news story or editorial distributed through a print, broadcast, satellite, cable or electronic medium;

(3) a candidate debate or forum or a communication announcing a candidate debate or forum paid for on behalf of the debate or forum sponsor; provided that two or more candidates for the same position have been invited to participate or, in the case of an uncontested election, that the single candidate for the position has been invited to participate;

(4) nonpartisan voter guides allowed by the federal Internal Revenue Code of 1986, as amended, for Section 501(c)(3) organizations; or

(5) statements made to a court or administrative board in the course of a formal judicial or administrative proceeding;

B. "anonymous contribution" means a contribution the contributor of which is unknown to the candidate or the candidate's agent or the political committee or its agent who accepts the contribution;

C. "ballot question" means a constitutional amendment or other question submitted to the voters in an election;

D. "bank account" means an account in a financial institution regulated by the United States or a state of the United States;

E. "campaign committee" means an association of two or more persons authorized by a candidate to act on the candidate's behalf for the purpose of electing the candidate to office; provided that a candidate shall not authorize more than one campaign committee;

F. "campaign expenditure" means an expenditure that is made by a campaign committee or by a candidate in support of the candidate's campaign in an election;

G. "candidate" means an individual who seeks or considers an office in an election covered by the Campaign Reporting Act, including a public official, who has filed a declaration of candidacy and has not subsequently filed a statement of withdrawal or:

(1) for a nonstatewide office, has received contributions or made expenditures of more than one thousand dollars ($1,000) or authorized another person or campaign committee to receive contributions or make expenditures of more than one thousand dollars ($1,000) for the purpose of seeking election to the office; or

(2) for a statewide office, has received contributions or made expenditures of more than three thousand dollars ($3,000) or authorized another person or campaign committee to receive contributions or make expenditures of more than three thousand dollars ($3,000) for the purpose of seeking election to the office or for candidacy exploration purposes in the years prior to the year of the election;

H. "contribution":

(1) means a gift, subscription, loan, advance, or deposit of money or other thing of value, including the estimated value of an in-kind contribution, that is made or received for a political purpose, including payment of a debt incurred in an election campaign;

(2) includes a coordinated expenditure;

(3) does not include the value of services provided without compensation or unreimbursed travel or other personal expenses of individuals who volunteer a portion or all of their time on behalf of a candidate or political committee nor does it include the administrative or solicitation expenses of a political committee that are paid by an organization that sponsors the committee; and

(4) does not include the value of the incidental use of the candidate's personal property, home or business office for campaign purposes;

I. "coordinated expenditure" means an expenditure that is made:

(1) by a person other than a candidate or

campaign committee;

(2) at the request or suggestion of, or in

cooperation, consultation or concert with, a candidate,

campaign committee or political party or any agent or

representative of a candidate, campaign committee or

political party; and

(3) for the purpose of:

(a) supporting or opposing the nomination or election of a candidate; or

(b) paying for an advertisement that refers to a clearly identified candidate and is published and disseminated to the relevant electorate in New Mexico within thirty days before the primary election or sixty days before the general election in which the candidate is on the ballot;

J. "deliver" or "delivery" means to deliver by certified or registered mail, telecopier, electronic transmission or facsimile or by personal service;

K. "election" means any primary, general or statewide special election in New Mexico and includes county and judicial retention elections but excludes federal, municipal, school board and special district elections;

L. "election year" means an even-numbered year in which an election covered by the Campaign Reporting Act is held;

M. "expenditure" means a payment, transfer or distribution or obligation or promise to pay, transfer or distribute any money or other thing of value, [for a political purpose] including payment of a debt incurred in an election campaign or pre-primary convention:

(1) by a campaign committee or a political committee;

(2) by a public official or candidate in support of the public official's or candidate's campaign for office in an election covered by the Campaign Reporting Act; or

(3) to pay for an advertisement that refers to a candidate or ballot question;

N. "independent expenditure" means an expenditure that is:

(1) made by a person other than a candidate or campaign committee;

(2) not a coordinated expenditure as defined in the Campaign Reporting Act; and

(3) made to pay for an advertisement that:

(a) expressly advocates the election or defeat of a clearly identified candidate or the passage or defeat of a clearly identified ballot question;

(b) is susceptible to no other reasonable interpretation than as an appeal to vote for or against a clearly identified candidate or ballot question; or

(c) refers to a clearly identified candidate or ballot question and is published and disseminated to the relevant electorate in New Mexico within thirty days before the primary election or sixty days before the general election at which the candidate or ballot question is on the ballot;

O. "legislative caucus committee" means a political committee established by the members of a political party in a chamber of the legislature;

P. "person" means an individual or entity;

Q. "political committee" means:

(1) a political party;

(2) a legislative caucus committee;

(3) an association that consists of two or more persons whose primary purpose is to make contributions to candidates, campaign committees or political committees or make coordinated expenditures or any combination thereof; or

(4) an association that consists of two or more persons whose primary purpose is to make independent expenditures and that has received more than five thousand dollars ($5,000) in contributions or made independent expenditures of more than five thousand dollars ($5,000) in the election cycle;

R. "political party" means an association that has qualified as a political party pursuant to the provisions of Section 1-7-2 NMSA 1978;

S. "political purpose" means for the purpose of supporting or opposing a ballot question or the nomination or election of a candidate;

T. "prescribed form" means a form or electronic format prepared and prescribed by the secretary of state;

U. "public official" means a person elected to an office in an election covered by the Campaign Reporting Act or a person appointed to an office that is subject to an election covered by that act; and

V. "reporting individual" means a public official, candidate or treasurer of a campaign committee or a treasurer of a political committee."

SECTION 2. Section 1-19-26.3 NMSA 1978 (being Laws 2002, Chapter 89, Section 1) is amended to read:

"1-19-26.3. CAMPAIGN COMMITTEE AND POLITICAL COMMITTEE EXPENDITURES--DISCLOSURE--TELEPHONE CALLS OR ELECTRONIC COMMUNICATIONS--RECORDS.--

A. A campaign committee or political committee that is required to register pursuant to the Campaign Reporting Act shall not expend campaign or political committee funds to, directly or indirectly, pay for a telephone call or electronic communication without disclosing to the recipient the name of the organization that authorized or paid for the call or electronic communication if the call or electronic communication:

(1) is one of five hundred or more calls or electronic communications that are similar in nature made during an election cycle by an individual or individuals, or by electronic means; and

(2) advocates support for, or opposition to, a candidate for public office or ballot measure.

B. The campaign committee or political committee that pays for a call or electronic communication referred to in Subsection A of this section shall be disclosed in the call or electronic communication unless the organization that authorized the call or electronic communication and in whose name it is placed has filing obligations pursuant to the Campaign Reporting Act and the name announced in the call or electronic communication is either:

(1) the full name by which the organization or individual is identified in any statement or report required to be filed pursuant to the Campaign Reporting Act; or

(2) the name by which the organization or individual is commonly known.

C. A campaign committee or political committee that pays directly or indirectly for telephone calls or electronic communications as described in Subsection A of this section shall maintain a record of the script of the calls or electronic communications for at least ninety days following election day. If any of the calls or electronic communications qualifying pursuant to Subsection A of this section are recorded messages, a copy of the recording shall also be maintained for that period.

D. A campaign committee or political committee may not contract with a phone bank vendor or electronic communication vendor that does not disclose the information required to be disclosed by Subsection A or B of this section."

SECTION 3. Section 1-19-27.3 NMSA 1978 (being Laws 2019, Chapter 262, Section 1) is amended to read:

"1-19-27.3. INDEPENDENT EXPENDITURES--REPORTING REQUIREMENTS.--

A. A person who makes an independent expenditure [not otherwise required to be reported under the Campaign Reporting Act] shall file a report with the secretary of state within:

(1) three days of making the expenditure if the expenditure, by itself or aggregated with all independent expenditures made by the same person during the election cycle, exceeds one thousand dollars ($1,000) in a nonstatewide election or three thousand dollars ($3,000) in a statewide election; or

(2) twenty-four hours of making the expenditure if the expenditure is in an amount of three thousand dollars ($3,000) or more and is made within seven days before a nonstatewide or statewide election.

B. The report required by Subsection A of this section shall state:

(1) the name and address of the person who made the independent expenditure;

(2) the name and address of the person to whom the independent expenditure was made and the amount, date and purpose of the independent expenditure. If no reasonable estimate of the monetary value of a particular expenditure is practicable, it is sufficient to report instead a description of the services, property or rights furnished through the expenditure; and

(3) the source of the contributions or donations used to make the independent expenditure as provided in Subsections C and D of this section.

C. A person who makes independent expenditures required to be reported under this section in an amount totaling three thousand dollars ($3,000) or less in a nonstatewide election or nine thousand dollars ($9,000) or less in a statewide election shall report the name and address of each person who has made [contributions] donations of more than a total of two hundred dollars ($200) in the election cycle that were earmarked for or made in response to a solicitation to fund independent expenditures and shall report the amount of each such [contribution] donation made by that person.

D. A person who makes independent expenditures required to be reported under this section in an amount totaling more than three thousand dollars ($3,000) in a nonstatewide election or nine thousand dollars ($9,000) in a statewide election, in addition to reporting the information specified in Subsection C of this section, shall either:

(1) if the expenditures were made exclusively from a segregated bank account consisting only of funds [contributed] donated to the account by individuals to be used for making independent expenditures, report the name and address of, and amount of each [contribution] donation made by, each [contributor] donor who [contributed] donated more than two hundred dollars ($200) to that account in the election cycle; or

(2) if the expenditures were made in whole or part from funds other than those described in Paragraph (1) of this subsection, report the name and address of, and amount of each [contribution] donation made by, each [contributor] donor who [contributed] donated more than a total of five thousand dollars ($5,000) during the election cycle to the person making the expenditures; provided, however, that a [contribution] donation is exempt from reporting pursuant to this paragraph if:

(a) the [contributor] donor requested in writing that the [contribution] donation not be used to fund independent or coordinated expenditures or to make contributions to a candidate, campaign committee or political committee; and

(b) the donation is deposited in a segregated bank account that is not used to fund independent or coordinated expenditures or to make contributions to a candidate, campaign committee or political committee.

E. If a person who has made a report required by this section is required to make subsequent reports during the election cycle, the information concerning contributions or donations in the subsequent reports shall cover only contributions or donations not previously reported.

F. For the purposes of this section, "donation" means a payment or transfer, or promise of payment or transfer, of money or other thing of value to a person who makes independent expenditures, but "donation" does not include:

(1) a payment or transfer made in a commercial transaction in the ordinary course of a trade or business;

(2) compensation for services rendered, capital invested or payment for a sale of property that is reasonable in amount and commensurate with the value of the services rendered, the magnitude of the risk undertaken on the investment or the property sold;

(3) a commercially reasonable loan made in the ordinary course of business by an institution authorized by the laws of the state to engage in the business of making loans;

(4) a gift on a special occasion from a family member or close personal friend; or

(5) a personal loan from a family member or a repayment of such a loan."

SECTION 4. Section 1-19-29 NMSA 1978 (being Laws 1993, Chapter 46, Section 5, as amended) is amended to read:

"1-19-29. TIME AND PLACE OF FILING REPORTS.--

A. Except as otherwise provided in this section, all reporting individuals shall file with the secretary of state no later than the second Monday in April and October a report of all expenditures made and contributions received on or before the first Monday in those months and not previously reported; provided that, if the date falls on a state holiday, the report shall be filed no later than the next business day. The report shall be filed biannually until the provisions specified in Subsection F or G [or H] of this section have been satisfied.

B. In an election year, instead of the biannual reports provided for in Subsection A of this section, all reporting individuals, except for public officials who are not candidates in an election that year, shall file reports of all expenditures made and contributions received or, if applicable, statements of no activity, according to the following schedule:

(1) no later than the second Monday in April, a report of all expenditures made and contributions received on or before the first Monday in April and not previously reported;

(2) no later than the second Monday in May, a report of all expenditures made and contributions received on or before the first Monday in May and not previously reported;

(3) no later than the second Monday in September, a report of all expenditures made and contributions received on or before the first Monday in September and not previously reported;

(4) no later than the second Monday in October, a report of all expenditures made and contributions received on or before the first Monday in October and not previously reported; provided that if the second Monday of October is a state holiday, the report shall be made on the following day;

(5) no later than the Thursday before a primary, general or statewide special election, a report of all expenditures made and contributions received by 5:00 p.m. on the Tuesday before the election and not previously reported. Any expenditure that is made or contribution or pledge to contribute that is received after 5:00 p.m. on the Tuesday before the election and that is for more than one thousand dollars ($1,000) in a nonstatewide election, or more than three thousand dollars ($3,000) in a statewide election, shall be reported to the secretary of state either in a supplemental report on a prescribed form within twenty-four hours [of receipt] or in the report to be filed no later than the Thursday before a primary, general or statewide special election, except that any such expenditure that is made or contribution or pledge to contribute that is received after 5:00 p.m. on the Friday before the election may be reported by 12:00 noon on the Monday before the election;

(6) no later than the thirtieth day after a primary election, a report by all reporting individuals, except those individuals that become candidates after the primary election, of all expenditures made and contributions received on or before the twenty-fifth day after the primary election and not previously reported;

(7) no later than the thirtieth day after a statewide special election, a report of all expenditures made and contributions received on or before the twenty-fifth day after the statewide special election and not previously reported; and

(8) no later than January 7 after a general election, a report of all expenditures made and contributions received on or before December 31 after the general election and not previously reported.

C. If a candidate, political committee, campaign committee or public official has not received any contributions and has not made any expenditures since the candidate's, committee's or official's last report was filed with the proper filing officer, the candidate, committee or official shall only be required to file a statement of no activity, which shall not be required to be notarized, in lieu of a full report when that report would otherwise be due and shall not be required to file a full report until the next required filing date occurring after an expenditure is made or a contribution is received.

D. In an election year, a public official who is not a candidate shall file biannual reports of expenditures made and contributions received or statements of no activity in accordance with the schedule provided for in Subsection A of this section.

E. A report of expenditures and contributions filed after a deadline set forth in this section shall not be deemed to have been timely filed.

F. Except for candidates, campaign committees and public officials who file a statement of no activity, each candidate, campaign committee or public official shall file a report of expenditures and contributions pursuant to the filing schedules set forth in this section, regardless of whether any expenditures were made or contributions were received during the reporting period. Reports shall be required until the reporting individual delivers a report to the secretary of state stating that:

(1) there are no outstanding campaign debts;

(2) all money has been expended in accordance with the provisions of Section 1-19-29.1 NMSA 1978; and

(3) the bank accounts have been closed.

[G. If, during a nonelection year, a political committee has not received any contributions or made any coordinated or independent expenditures since it filed its last report pursuant to this section, it need not file any report under this section until the next reporting period, if any, in which it receives contributions or makes expenditures. A political committee that has not received any contributions or made any coordinated or independent expenditures for a continuous period of at least one year may cancel its registration as a political committee by submitting an appropriate request in writing to the secretary of state. The committee shall retain the obligation to submit a new registration pursuant to Section 1-19-26.1 NMSA 1978 in the event that its future activities meet the requisites for registration under that section.

H.] G. A reporting individual who is a candidate within the meaning of the Campaign Reporting Act because of the amount of contributions the candidate receives or expenditures the candidate makes and who does not ultimately file a declaration of candidacy or a nominating petition with the secretary of state and does not file a statement of no activity shall file biannual reports in accordance with Subsection A of this section.

[I.] H. Reports required by this section shall be subscribed and sworn to by the candidate or the treasurer of the political committee or, in the case of candidates for judicial office, by the treasurer of the candidate's campaign committee. A report filed electronically shall be electronically authenticated by the candidate or the treasurer of the committee using an electronic signature in conformance with the Electronic Authentication of Documents Act and the Uniform Electronic Transactions Act. For the purposes of the Campaign Reporting Act, a report that is electronically authenticated in accordance with the provisions of this subsection shall be deemed to have been subscribed and sworn to by the candidate or the treasurer of the committee who was required to file the report.

[J.] I. Reports required by this section shall be filed electronically by all reporting individuals.

[K.] J. Reporting individuals may apply to the secretary of state for exemption from electronic filing in case of hardship, which shall be defined by the secretary of state."

SECTION 5. Section 1-19-29.1 NMSA 1978 (being Laws 1993, Chapter 46, Section 6, as amended) is amended to read:

"1-19-29.1. CAMPAIGN FUNDS--LIMITATION ON USE.--

A. It is unlawful for a candidate or the candidate's agent to make an expenditure of contributions received, except for the following purposes or as otherwise provided in this section:

(1) expenditures of the campaign;

(2) expenditures of legislators that are reasonably related to performing the duties of the office held, including mail, telephone and travel expenditures to serve constituents, but excluding personal and legislative session living expenses;

(3) donations to the state general fund;

(4) donations to an organization to which a federal income tax deduction would be permitted under Subparagraph (A) of Paragraph (1) of Subsection (b) of Section 170 of the Internal Revenue Code of 1986, as amended;

(5) expenditures to eliminate the campaign debt of the candidate for the office sought or expenditures incurred by the candidate when seeking election to another public office covered by the Campaign Reporting Act;

(6) donations to a political committee or to another candidate seeking election to public office covered by the Campaign Reporting Act; or

(7) disbursements to return unused funds pro rata to the contributors if no campaign debt exists.

B. It is unlawful for a candidate or the candidate's agent to make an expenditure to repay a loan that is received from the candidate and that includes a rate of interest.

[B.] C. A judge subject to a nonpartisan retention election or a candidate for judicial office shall solicit or accept campaign funds and return unused funds in accordance with the provisions of the Code of Judicial Conduct.

[C.] D. No contributions solicited for or received in a federal election campaign may be used in a state election campaign."

SECTION 6. Section 1-19-31 NMSA 1978 (being Laws 1979, Chapter 360, Section 7, as amended) is amended to read:

"1-19-31. CONTENTS OF REPORT.--Each required report of expenditures and contributions shall be typed or printed legibly, or on a computer disc or format approved by the secretary of state, and shall include:

A. the name and address of the person or entity to whom an expenditure was made or from whom a contribution was received, except as provided for anonymous contributions or contributions received from special events as provided in Section 1-19-34 NMSA 1978; provided that for contributors, the name of the entity or the first and last names of any individual shall be the full name of the entity or individual, and initials only shall not constitute a full name unless that is the complete legal name;

B. the occupation, name and type of business, as applicable, of any individual or entity making contributions of two hundred dollars ($200) or more in the aggregate per election;

C. the amount of the expenditure or contribution or value thereof;

D. the purpose of the expenditure;

E. the date that the expenditure was made or the contribution was received;

F. the opening and closing cash balance for the bank accounts maintained by the reporting individual during the reporting period and the name of the financial institution for each account; and

G. the amount of each unpaid debt and the identity of the person to whom the debt is owed, the terms of any loan that a candidate makes to the candidate's campaign committee and evidence of any loan that a candidate makes to the candidate's campaign committee."

SECTION 7. Section 1-19-34.1 NMSA 1978 (being Laws 1993, Chapter 46, Section 12, as amended) is amended to read:

"1-19-34.1. LEGISLATIVE SESSION FUNDRAISING PROHIBITION.--

A. It is unlawful during the prohibited period for [a state legislator, the attorney general, the secretary of state, the state treasurer, the commissioner of public lands or the state auditor or a candidate for state legislator, attorney general, secretary of state, state treasurer, commissioner of public lands or state auditor, or any agent on behalf of the attorney general, the secretary of state, the state treasurer, the commissioner of public lands or the state auditor or a candidate for attorney general, the secretary of state, state treasurer, commissioner of public lands or state auditor] an incumbent or candidate for a proscribed office, a campaign committee or a legislative caucus committee to [knowingly]:

(1) solicit a contribution governed by the Campaign Reporting Act; [For purposes of this subsection, "prohibited period" means that period beginning January 1 prior to any regular session of the legislature or, in the case of a special session, after the proclamation has been issued, and ending on adjournment of the regular or special session.

B. It is unlawful during the prohibited period for the governor or the lieutenant governor, or any agent on the governor's or the lieutenant governor's behalf, to knowingly solicit a contribution governed by the Campaign Reporting Act. For purposes of this subsection, "prohibited period" means that period beginning January 1 prior to any regular session of the legislature or, in the case of a special session, after the proclamation has been issued, and ending on the twentieth day following the adjournment of the regular or special session.]

(2) accept a contribution from a lobbyist, lobbyist's employer, incumbent or candidate, campaign committee or political committee;

(3) accept a contribution from any person, other than a person excluded by Paragraph (2) of this subsection, who prior to the start of a prohibited period signed up to have an automated, recurring contribution of more than one hundred dollars ($100) per month; or

(4) accept a contribution from any person, other than a person excluded by Paragraph (2) of this subsection or allowed by Paragraph (3) of this subsection, of more than one hundred dollars ($100); provided that the aggregate of contributions of one hundred dollars ($100) or less accepted during the prohibited period shall not exceed:

(a) two thousand dollars ($2,000) for a campaign committee, a legislative caucus committee or an incumbent or candidate for a statewide office; and

(b) five hundred dollars ($500) for any other incumbent or candidate for a proscribed office.

B. Any contribution received during the prohibited period in excess of the limits established in this section shall be returned to the donor or donated to the public election fund prior to the end of the reporting period in which the excess donation was received.

C. As used in this section:

(1) "incumbent or candidate" means:

(a) a person currently holding an office subject to election;

(b) a person who is a candidate for an office subject to election;

(d) an agent on behalf of a person or a committee described in Subparagraphs (a) through (c) of this paragraph;

(2) "lobbyist" means a person who is required to register as a lobbyist pursuant to the provisions of the Lobbyist Regulation Act;

(3) "lobbyist's employer" means the person whose interests are being represented and by whom a lobbyist is directly or indirectly retained, compensated or employed;

(4) "prohibited period" means:

(a) for an incumbent or candidate for any proscribed office other than governor or lieutenant governor and for a campaign committee or a legislative caucus committee, the period beginning January 1 prior to any regular session of the legislature or, in the case of a special or extraordinary session, the lesser of the period beginning after the proclamation has been issued or seventy-two hours prior to the start of the special or extraordinary session, and ending on the first calendar day after adjournment of the regular, special or extraordinary session; and

(b) for an incumbent or candidate for governor or lieutenant governor, the period beginning January 1 prior to any regular session of the legislature or, in the case of a special or extraordinary session, the lesser of the period beginning after the proclamation has been issued or seventy-two hours prior to the start of the special or extraordinary session, and ending on the earlier of the twenty-first day following adjournment of the regular, special or extraordinary session or the first calendar day after all bills passed by the legislature have been signed or vetoed and deposited with the secretary of state; and

(5) "proscribed office" means:

(a) governor;

(b) lieutenant governor;

(d) attorney general;

(e) state auditor;

(f) state treasurer;

(g) commissioner of public lands;

(h) state senator; and

(i) state representative."