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H.B. 101

             1     

LOBBYIST GIFT LIMITS AND DISCLOSURE

             2     
2006 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Jeff Alexander

             5     
Senate Sponsor: Thomas V. Hatch

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill modifies the Lobbyist Disclosure and Regulation Act and a reporting section
             10      of the Election Code.
             11      Highlighted Provisions:
             12          This bill:
             13          .    provides and modifies definitions;
             14          .    requires political action committees to file a yearly organizational statement;
             15          .    removes reporting exemptions from certain travel, lodging, and meal expenses;
             16          .    provides that public officials, elected officials of local governments, and certain
             17      state employees are subject to lobbyist disclosure regulations;
             18          .    requires that financial expenditure reports be filed quarterly;
             19          .    requires that certain details be reported on expenditures over $5;
             20          .    provides that single expenses in the amount of $5 or less are not required to be
             21      reported unless they are combined with other expenses;
             22          .    establishes conflict of interest standards for lobbyists; and
             23          .    makes technical changes.
             24      Monies Appropriated in this Bill:
             25          None
             26      Other Special Clauses:
             27          None


             28      Utah Code Sections Affected:
             29      AMENDS:
             30          20A-11-601, as enacted by Chapter 1, Laws of Utah 1995
             31          36-11-102, as last amended by Chapter 13, Laws of Utah 1998
             32          36-11-201, as last amended by Chapter 27, Laws of Utah 2003
             33      ENACTS:
             34          36-11-306, Utah Code Annotated 1953
             35     
             36      Be it enacted by the Legislature of the state of Utah:
             37          Section 1. Section 20A-11-601 is amended to read:
             38           20A-11-601. Political action committees -- Registration.
             39          (1) (a) Each political action committee shall file a statement of organization with the
             40      lieutenant governor's office on January 10 of each year, unless the political action committee
             41      has filed a notice of dissolution under Subsection (3).
             42          (b) If a political action committee is organized after the January 10 filing date, the
             43      political action committee shall file an initial statement of organization no later than seven
             44      calendar days after:
             45          [(a)] (i) receiving contributions totaling at least $750 [in any calendar year]; or
             46          [(b)] (ii) distributing expenditures for political purposes totaling at least $750 [in any
             47      calendar year].
             48          (c) If January 10 falls on a weekend or holiday, the statement of organization shall be
             49      due on the following business day.
             50          (2) The statement of organization shall include:
             51          (a) the name and address of the political action committee;
             52          (b) the name, address, occupation, and title of each officer;
             53          (c) the name and address of the organization, individual corporation, association, unit
             54      of government, or union that the political action committee represents, if any;
             55          (d) the name and address of all affiliated or connected organizations and their
             56      relationships to the political action committee;
             57          (e) the name, address, business address, occupation, and phone number of the
             58      committee's treasurer or chief financial officer; and


             59          (f) the name, address, and occupation of each member of the governing board, if any.
             60          (3) (a) Any registered political action committee that intends to permanently cease
             61      operations shall file a notice of dissolution with the lieutenant governor's office.
             62          (b) Any notice of dissolution filed by a political action committee does not exempt that
             63      political action committee from complying with the financial reporting requirements of this
             64      chapter.
             65          Section 2. Section 36-11-102 is amended to read:
             66           36-11-102. Definitions.
             67          As used in this chapter:
             68          (1) "Aggregate daily expenditures" means the total expenditures made within a 24-hour
             69      period.
             70          (2) "Executive action" means:
             71          (a) nominations and appointments by the governor;
             72          (b) the proposal, drafting, amendment, enactment, or defeat by a state agency of any
             73      rule made in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act; and
             74          (c) agency ratemaking proceedings.
             75          (3) (a) "Expenditure" means any of the items listed in this subsection when given to or
             76      for the benefit of a public official or his immediate family:
             77          (i) a purchase, payment, distribution, loan, gift, advance, deposit, subscription,
             78      forbearance, services, or goods, unless consideration of equal or greater value is received; and
             79          (ii) a contract, promise, or agreement, whether or not legally enforceable, to provide
             80      any of the items listed in Subsection (3)(a)(i).
             81          (b) "Expenditure" does not mean:
             82          (i) a commercially reasonable loan made in the ordinary course of business;
             83          (ii) a campaign contribution reported in accordance with Title 20A, Chapter 11,
             84      [Corrupt Practices in Elections] Campaign and Financial Reporting Requirements;
             85          (iii) printed informational material;
             86          (iv) a devise or inheritance;
             87          (v) any item listed in Subsection (3)(a) if given by a relative;
             88          (vi) a modest item of food or refreshment such as a beverage or pastry offered other
             89      than as part of a meal, the value of which does not exceed $5;


             90          (vii) a greeting card or other item of little intrinsic value that is intended solely for
             91      presentation; or
             92          (viii) plaques, commendations, or awards[; or].
             93          [(ix) reimbursement of reasonable expenses for or providing travel, lodging, or meals
             94      to a public official when:]
             95          [(A) those expenses are directly related to the public official's attendance and
             96      participation in a regularly scheduled meeting of an organization, association, or group; and]
             97          [(B) that organization, association, or group pays or provides those expenses.]
             98          (4) (a) "Government officer" means:
             99          (i) an individual elected to a position in state or local government, when acting within
             100      his official capacity; or
             101          (ii) an individual appointed to or employed in a full-time position by state or local
             102      government, when acting within the scope of his employment.
             103          (b) "Government officer" does not mean a member of the legislative branch of state
             104      government.
             105          (5) "Immediate family" means a spouse, a child residing in the household, or an
             106      individual claimed as a dependent for tax purposes.
             107          (6) "Interested person" means an individual defined in Subsections (9)(b)(ii) and
             108      [(viii)] (vii).
             109          (7) "Legislative action" means:
             110          (a) bills, resolutions, amendments, nominations, and other matters pending or proposed
             111      in either house of the Legislature or its committees or requested by a legislator; and
             112          (b) the action of the governor in approving or vetoing legislation.
             113          (8) "Lobbying" means communicating with a public official for the purpose of
             114      influencing the passage, defeat, amendment, or postponement of legislative or executive action.
             115          (9) (a) "Lobbyist" means:
             116          (i) an individual who is employed by a principal; or
             117          (ii) an individual who contracts for economic consideration, other than reimbursement
             118      for reasonable travel expenses, with a principal to lobby a public official.
             119          (b) "Lobbyist" does not include:
             120          [(i) a public official while acting in his official capacity on matters pertaining to his


             121      office or a state employee while acting within the scope of his employment;]
             122          (i) a member or employee of the legislative branch of government;
             123          (ii) any person appearing at, or providing written comments to, a hearing conducted in
             124      accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking Act or Title 63,
             125      Chapter 46b, Administrative Procedures Act;
             126          (iii) any person participating on or appearing before an advisory or study task force,
             127      commission, board, or committee, constituted by the Legislature or any agency or department
             128      of state government, except legislative standing, appropriation, or interim committees;
             129          (iv) a representative of a political party;
             130          (v) an individual representing a bona fide church solely for the purpose of protecting
             131      the right to practice the religious doctrines of the church unless the individual or church makes
             132      an expenditure that confers a benefit on a public official;
             133          (vi) a newspaper, television station or network, radio station or network, periodical of
             134      general circulation, or book publisher for the purpose of publishing news items, editorials,
             135      other comments, or paid advertisements that directly or indirectly urge legislative or executive
             136      action; or
             137          [(vii) an elected official of a local government while acting within the scope of his
             138      official capacity on matters pertaining to his office or an employee of a local government while
             139      acting within the scope of his employment; or]
             140          [(viii)] (vii) an individual who appears on his own behalf before a committee of the
             141      Legislature or an executive branch agency solely for the purpose of testifying in support of or
             142      in opposition to legislative or executive action.
             143          (10) "Person" includes individuals, bodies politic and corporate, partnerships,
             144      associations, and companies.
             145          (11) "Principal" means a person who employs [a lobbyist] an individual to perform
             146      lobbying either as an employee or as an independent contractor.
             147          (12) "Public official" means:
             148          (a) a member of the Legislature;
             149          (b) an individual elected to a position in the executive branch; or
             150          (c) an individual appointed to or employed in the executive or legislative branch if that
             151      individual:


             152          (i) occupies a policymaking position or makes purchasing or contracting decisions;
             153          (ii) drafts legislation or makes rules;
             154          (iii) determines rates or fees; or
             155          (iv) makes adjudicative decisions.
             156          (13) "Quarterly reporting period" means the three-month period covered by each
             157      financial report required under Subsection 36-11-201 (2)(a)(i).
             158          [(13)] (14) "Related person" means any person, or agent or employee of a person, who
             159      knowingly and intentionally assists a lobbyist, principal, or government officer in lobbying.
             160          [(14)] (15) "Relative" means a spouse, child, parent, grandparent, grandchild, brother,
             161      sister, parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle, first cousin, or
             162      spouse of any of these individuals.
             163          Section 3. Section 36-11-201 is amended to read:
             164           36-11-201. Lobbyist, principal, and government officer financial reporting
             165      requirements -- Prohibition for related person to make expenditures.
             166          (1) As used in this section, "public official type" means a notation to identify whether
             167      the public official is:
             168          (a) a member of the legislature;
             169          (b) an individual elected to a position in the executive branch;
             170          (c) an individual appointed to or employed in a position in the legislative branch who
             171      meets the definition of public official in Section 36-11-102 ; or
             172          (d) an individual appointed to or employed in a position in the executive branch who
             173      meets the definition of public official in Section 36-11-102 .
             174          (2) (a) (i) Each lobbyist, principal, and government officer that makes an expenditure
             175      during any of the following quarterly reporting periods shall file [an annual] a quarterly
             176      financial report with the lieutenant governor on [January 10 of each year or] the following
             177      dates:
             178          (A) April 10, for the period of November 1 through March 31;
             179          (B) July 10, for the period of April 1 through June 30;
             180          (C) October 10, for the period of July 1 through September 30; and
             181          (D) January 10, for the period of October 1 through December 31 of the previous year.
             182          (ii) If the due date for a financial report falls on a Saturday, Sunday, or legal holiday,


             183      the report shall be considered to be due on the next succeeding business day [if January 10 falls
             184      on a Saturday, Sunday, or legal holiday].
             185          (iii) The report shall be considered timely filed if postmarked on its due date.
             186          [(ii)] (iv) The report shall disclose expenditures made to benefit public officials or
             187      members of their immediate families as provided in this section.
             188          [(iii) If] (v) (A) Notwithstanding Subsection (2)(a)(i), a lobbyist shall file a quarterly
             189      financial report whether or not the lobbyist has made [no expenditures since the last
             190      expenditure reported on the last report filed,] an expenditure during the quarterly reporting
             191      period.
             192          (B) If the lobbyist has made no expenditures during the quarterly reporting period, the
             193      lobbyist shall file a quarterly financial report listing the amount of expenditures as "none."
             194          (C) The report shall be filed in accordance with the dates specified under Subsections
             195      (2)(a)(i) and (ii).
             196          (b) The [January 10] quarterly financial report shall contain:
             197          (i) (A) the total amount of expenditures made to benefit public officials during the last
             198      [calendar year] quarterly reporting period; and
             199          (B) the total amount of expenditures made to benefit public officials by public official
             200      type during the last [calendar year] quarterly reporting period;
             201          (ii) (A) the total travel expenditures that the lobbyist, principal, or government officer
             202      made to benefit public officials and their immediate families during the [last calendar year]
             203      quarterly reporting period; and
             204          (B) the total travel expenditures that the lobbyist, principal, or government officer
             205      made to benefit public officials and their immediate families, by public official type, during the
             206      last [calendar year] quarterly reporting period; and
             207          (C) a travel expenditure statement that:
             208          (I) describes the destination of each trip and its purpose;
             209          (II) identifies the total amount of expenditures made to benefit each public official and
             210      members of the public official's immediate family for each trip;
             211          (III) names all individuals that took each trip;
             212          (IV) identifies the public official type to which each public official belongs;
             213          (V) provides the name and address of the organization that sponsored each trip; and


             214          (VI) identifies specific expenditures for food, lodging, gifts, and sidetrips;
             215          (iii) except as specified under Subsection (2)(b)(iv) regarding expenditures for food or
             216      beverage, for each aggregate daily [expenditures] expenditure made during the quarterly
             217      reporting period to benefit a public [officials or members of their] official or a member of the
             218      public official's immediate [families] family in an amount exceeding $5 per person, that [are] is
             219      not otherwise reportable under Subsection (2)(b)(ii):
             220          [(A) when the amount does not exceed $50 per person:]
             221          [(I) the date of the expenditure;]
             222          [(II) the purpose of the expenditure;]
             223          [(III) the public official type to which each public official belongs; and]
             224          [(IV) the total monetary worth of the benefit conferred on the public officials or
             225      members of their immediate families;]
             226          [(B) when the amount exceeds $50 per person:]
             227          [(I)] (A) the date, location, and purpose of the event, activity, or expenditure;
             228          [(II)] (B) the name of the public official or member of the public official's immediate
             229      family who attended the event or activity or received the benefit of the expenditure;
             230          [(III)] (C) the public official type to which each public official belongs; and
             231          [(IV)] (D) the total monetary worth of the benefit conferred on the public official or
             232      member of the public official's immediate family by the lobbyist, principal, or government
             233      officer filing the financial report;
             234          (iv) (A) for each aggregate daily expenditure for food or beverage made during the
             235      quarterly reporting period to benefit a public official or a member of a public official's
             236      immediate family in an amount exceeding $5 per person, but not exceeding $50 per person:
             237          (I) the date of the expenditure;
             238          (II) the purpose of the expenditure;
             239          (III) the public official type to which each public official belongs; and
             240          (IV) the total monetary worth of the benefit conferred on the public official or member
             241      of the public official's immediate family; and
             242          (B) each aggregate daily expenditure for food or beverage that exceeds $50 per person
             243      shall be reported under Subsection (2)(b)(iii);
             244          [(iv)] (v) a list of each public official who was employed by the lobbyist, principal, or


             245      government officer or who performed work as an independent contractor for the lobbyist,
             246      principal, or government officer during the last year that details the nature of the employment
             247      or contract;
             248          [(v)] (vi) each bill or resolution by number and short title on behalf of which the
             249      lobbyist, principal, or government officer made an expenditure to a public official for which a
             250      report is required by this section, if any;
             251          [(vi)] (vii) a description of each executive action on behalf of which the lobbyist,
             252      principal, or government officer made an expenditure to a public official for which a report is
             253      required by this section, if any; and
             254          [(vii)] (viii) the general purposes, interests, and nature of the organization or
             255      organizations that the lobbyist, principal, or government officer filing the report represents.
             256          (c) In reporting expenditures under this section for events to which all legislators are
             257      invited, each lobbyist, principal, and government officer:
             258          (i) may not divide the cost of the event by the number of legislators who actually attend
             259      the event and report that cost as an expenditure made to those legislators;
             260          (ii) shall divide the total cost by the total number of Utah legislators and others invited
             261      to the event and report that quotient as the amount expended for each legislator who actually
             262      attended the event; and
             263          (iii) may not report any expenditure as made to a legislator who did not attend the
             264      event.
             265          (3) (a) As used in this Subsection (3):
             266          (i) "Lobbyist group" means two or more lobbyists, principals, government officers,
             267      [and] or any combination of lobbyists, principals, and government officers who each contribute
             268      a portion of an expenditure made to benefit a public official or member of his immediate
             269      family.
             270          (ii) "Multiclient lobbyist" means a single lobbyist, principal, or government officer
             271      who represents two or more clients and divides the aggregate daily expenditure made to benefit
             272      a public official or member of his immediate family between two or more of those clients.
             273          (b) When a lobbyist group combines to make aggregate daily expenditures to benefit
             274      public officials or members of their immediate families, and the total aggregate daily
             275      expenditure of the lobbyist group exceeds [$50] $5 per person, each member of the lobbyist


             276      group shall disclose on the reports required by this section:
             277          (i) the date, location, and purpose of the event, activity, or expenditure;
             278          (ii) the name of the public official or member of the public official's immediate family
             279      who attended the event or activity or received the benefit of the expenditure;
             280          (iii) the public official type to which each public official belongs;
             281          (iv) the total monetary worth of the benefit conferred on the public official or member
             282      of the public official's immediate family by the lobbyist group [and];
             283          (v) the total monetary worth of the benefit conferred upon the public official or
             284      member of the public official's immediate family by the lobbyist, principal, or government
             285      officer filing the financial report;
             286          [(v)] (vi) each bill or resolution by number and short title on behalf of which the
             287      lobbyist, principal, or government officer made an expenditure to a public official for which a
             288      report is required by this section, if any;
             289          [(vi)] (vii) a description of each executive action on behalf of which the lobbyist,
             290      principal, or government officer made an expenditure to a public official for which a report is
             291      required by this section, if any; and
             292          [(vii)] (viii) the general purposes, interests, and nature of the organization or
             293      organizations that the lobbyist, principal, or government officer filing the report represents.
             294          (c) When a multiclient lobbyist makes aggregate daily expenditures to benefit public
             295      officials or members of their immediate families, and the sum of the total aggregate daily
             296      expenditure for all of the lobbyist's clients exceeds [$50] $5 for a public official or family
             297      member, the multiclient lobbyist shall, for each client, disclose on the reports required by this
             298      section:
             299          (i) the date, location, and purpose of the event, activity, or expenditure;
             300          (ii) the name of the public official or member of the public official's immediate family
             301      who attended the event or activity or received the benefit of the expenditure;
             302          (iii) the public official type to which each public official belongs;
             303          (iv) the total monetary worth of the benefit conferred on the public official or member
             304      of the public official's immediate family by all clients [and];
             305          (v) the total monetary worth of the benefit conferred on the public official or member
             306      of the public official's immediate family by the client upon whose behalf the report is filed;


             307          [(v)] (vi) each bill or resolution by number and short title on behalf of which the
             308      lobbyist, principal, or government officer made an expenditure to a public official for which a
             309      report is required by this section, if any;
             310          [(vi)] (vii) a description of each executive action on behalf of which the lobbyist,
             311      principal, or government officer made an expenditure to a public official for which a report is
             312      required by this section, if any; and
             313          [(vii)] (viii) the general purposes, interests, and nature of the organization or
             314      organizations that the lobbyist, principal, or government officer filing the report represents.
             315          (4) A related person may not, while assisting a lobbyist, principal, or government
             316      officer in lobbying, make an expenditure that benefits a public official or member of the public
             317      official's immediate family under circumstances which would otherwise fall within the
             318      disclosure requirements of this chapter if the expenditure was made by the lobbyist, principal,
             319      or government officer.
             320          [(5) (a) Each lobbyist, principal, and government officer who makes expenditures
             321      totaling $50 or more to benefit public officials or members of their immediate families since
             322      the date of the last financial report filed shall file a financial report with the lieutenant governor
             323      on:]
             324          [(i) the date ten days after the last day of each annual general session;]
             325          [(ii) the date seven days before a regular general election; and]
             326          [(iii) the date seven days after the end of a special session or veto override session.]
             327          [(b) (i) If any date specified in this Subsection (5) falls on a Saturday, Sunday, or legal
             328      holiday, the report is due on the next business day or on the next succeeding business day, if
             329      the due date falls on a Saturday, Sunday, or legal holiday.]
             330          [(ii) The report shall be considered timely filed if it is postmarked on its due date.]
             331          [(c) Each report shall contain a listing of all expenditures made since the last
             332      expenditure reported on the last report filed in the form specified in Subsection (2)(b) and,
             333      when applicable, Subsection (3).]
             334          [(d) In preparing each financial report, all expenditures shall be reported as of five days
             335      before the required filing date of the report.]
             336          [(6)] (5) Each quarterly financial report filed by a lobbyist shall contain a certification
             337      that the information provided in the report is true, accurate, and complete to the lobbyist's best


             338      knowledge and belief.
             339          [(7)] (6) The lieutenant governor shall:
             340          (a) develop preprinted suggested forms for all statements required by this section; and
             341          (b) make copies of the forms available to each person who requests them.
             342          [(8)] (7) Each lobbyist and principal shall continue to file the quarterly financial reports
             343      required by this section [until the lobbyist or principal has filed the report due on the first
             344      January 10 that is more than] for a period of 12 months after the date that the lobbyist
             345      surrenders, fails to renew, or otherwise ceases to be licensed.
             346          Section 4. Section 36-11-306 is enacted to read:
             347          36-11-306. Conflicts of interest.
             348          (1) As used in this section, "conflict of interest" means a circumstance where:
             349          (a) the representation of one principal or client will be directly adverse to another
             350      principal or client; or
             351          (b) there is a significant risk that the representation of one or more principals or clients
             352      will be materially limited by the lobbyist's responsibilities to:
             353          (i) another principal or client;
             354          (ii) a former principal or client;
             355          (iii) a third person; or
             356          (iv) a personal interest of the lobbyist.
             357          (2) Except as provided in Subsection (3), a lobbyist may not represent a principal or
             358      client if the representation involves a conflict of interest.
             359          (3) Notwithstanding the existence of a conflict of interest, a lobbyist may represent a
             360      principal or client if:
             361          (a) the lobbyist reasonably believes that the lobbyist will be able to provide competent
             362      and diligent representation to each principal or client;
             363          (b) the representation is not otherwise prohibited by law;
             364          (c) the representation does not require the lobbyist to assert a position on behalf of one
             365      principal or client that is opposed to the position of another principal or client represented by
             366      the lobbyist involving the same legislative issue; and
             367          (d) each affected principal or client gives informed consent to the conflict of interest in
             368      writing.






Legislative Review Note
    as of 1-10-06 10:23 AM


Based on a limited legal review, this legislation has not been determined to have a high
probability of being held unconstitutional.

Office of Legislative Research and General Counsel


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