SB 67

Under current law, corporations and cooperatives are prohibited from making

contributions or disbursements (expenditures) in campaigns for state or local office.

Violators are subject to a forfeiture (civil penalty) of not more than $500 for each

violation. Intentional violators are guilty of a Class I felony, which is punishable by

a fine of not more than $10,000 or imprisonment for three and one-half years, or

both, except that if a violation involves $100 or less, the violation is punishable as

a misdemeanor with a fine of not more than $1,000 or imprisonment for not more

than six months, or both. A recent decision of the U.S. Supreme Court has cast doubt

about whether this law is enforceable as it applies to disbursements. See

Citizens

United v. F.E.C.

, Case No. 08-205 (2010).

This bill provides that if a court with jurisdiction in this state finds in a reported

decision, whether or not applicable in this state, that a prohibition against the

making of political expenditures by corporations or similar entities is not enforceable

for constitutional reasons, the Government Accountability Board (GAB) must

publish a finding to that effect. The bill provides that, during a period when a finding

of unenforceability is in effect, before a corporation or cooperative may make a

disbursement or incur an obligation to make a disbursement for the purpose of

influencing an election for state or local office, the corporation or cooperative must

file with its registration statement and maintain on file with the appropriate filing

officer or agency: 1) a copy of a document that is satisfactory to the GAB, reflecting

action taken not more than two years previous to the time that any disbursement is

made or any obligation to make a disbursement is incurred, demonstrating that the

corporation or cooperative has received the approval of a majority of its voting shares

or members who are entitled to elect the board of directors for the corporation or

cooperative to make disbursements and incur obligations to make disbursements for

the purpose of influencing an election for state or local office; or 2) a statement that

the corporation or cooperative has no shareholders or members.

The bill also prohibits any corporation or cooperative from making a

disbursement in a campaign for state or local office, subject to the current penalties,

if the corporation or cooperative is owned or controlled by one or more foreign

nationals, as defined by federal law. The bill defines ownership or control as meaning

that 1) one or more foreign nationals own 50 percent or more of the voting shares; 2)

a majority of the members of the board of directors are foreign nationals; or 3) one

or more foreign nationals has the power to direct or control the decision-making

process of the corporation or cooperative with respect to the interests of the United

States or activities in connection with an election for state or local office.

Currently, individuals who accept contributions, organizations that make or

accept contributions, and individuals who or organizations that incur obligations or