The 2013 Minnesota Legislative Session saw the passage of significant campaign finance and election law legislation. Governor Dayton indicated at the beginning of this session that, despite the DFL majorities in both the Minnesota House and Senate, he expected any legislation presented to him to have bipartisan support. In the end, both the Campaign Finance Policy and Technical Bill (Chapter 138) and the Omnibus Elections Bill (Chapter 131) received bipartisan backing and were signed into law.

Campaign Finance Policy and Technical Bill (Chapter 138)
Chapter 138, the Campaign Finance Policy and Technical Bill, began as the recommendations of the Minnesota Campaign Finance and Public Disclosure Board ("Board") (SF 661/HF 863). The new law includes some provisions that were not part of the Board's original proposal; other provisions that had been sought by the Board were dropped from the final version. As ultimately adopted, the law contains changes to candidate contribution and spending limits, the gifts to public officials law, and changes to requirements for independent expenditures.

Contribution and Spending Limits  
Candidates who have signed a public subsidy agreement will now be subject to new higher spending limits. The new spending limits apply over two-year segments, with a segment beginning on January 1 of each odd-numbered year. If there is a general election in the second year of the segment, the segment is called an "election year segment." If there is not a general election in the second year of the segment, the segment is called a "non-election year segment." The overall effect of these changes is to increase both the amount of money the candidate accepting public subsidy can spend, as well as the amount of money that can be contributed to the candidates.

For example, the limit on contributions to legislative candidates has increased to $1,000 during either a two-year election or non-election segment. The spending limit for a candidate for State Senate who has signed a public subsidy agreement is increased to $30,000 for the two-year non-election segment and to $90,000 for the two-year election segment. The spending limit for House candidates is increased to $60,000 for the two-year election segment.

In total, the aggregate expenditure limits for candidates receiving public subsidies are substantially increased. For Governor and Lieutenant Governor, running together, the spending limit has increased from $2,577,200 over the four-year cycle to $5,000,000. For Attorney General, the spending limit has increased from $429,600 over the four-year cycle to $800,000. The increase is partially justified by the cost-of-living increases that have diminished the effect of the spending limits since they were previously set. The higher spending limits are also intended to reduce the impact of independent expenditure groups, which are not subject to spending or contribution limits. It is also thought that the higher limits will encourage candidates to take public subsidies and abide by the limits. The new spending and contribution limits became effective on May 25, 2013.

For a detailed summary of the new contribution and spending limits, which will be in effect for the 2014 elections, visit the Campaign Finance and Public Disclosure Board website at www.cfboard.state.mn.us for a copy of the Board publication "2013-2014 Election Cycle Segment Contribution and Campaign Expenditure Limits."

Corporate Political Expenditures 
The Board's authority to investigate alleged violations of the prohibition on corporate political expenditures in Minn. Stat. Sec. 211B.15 is expanded. Under prior law, these issues, as well as issues dealing with campaign literature disclaimers in 211B.04 and legal expenditures in 211B.12, are under the jurisdiction of the Office of Administrative Hearings and ultimately the applicable County Attorney. In addition, the Board has now been granted the authority to issue advisory opinions over these three sections of law.

In addition, several changes, not contained in the original Board proposals, were made to the penalty provisions for inadvertent violations of the prohibition on corporate political contributions. Under prior law, violations of Minnesota Statute 211B.15 were severe, even for unknowing or inadvertent violations. Under the revised law, violations are required to be knowing (Sections 51, 52 and 53) before they will be considered criminal.

Gifts to Public Officials
An amendment offered on the Senate floor created an exception to the prohibition on gifts to public officials. Under the new exception in the law (Section 18), food or beverage given by a lobbyist or lobbyist principal at a reception, meal or meeting is permissible if the recipient is a member or employee of the Legislature and an invitation to attend the reception, meal or meeting was provided to all members of the Legislature at least five days prior to the date of the event. Proponents of the amendment argued that it would increase the collegiality among members of the Legislature while opponents argued that it was a glaring loophole in the otherwise settled gift law that would be subject to abuse. This new exception became effective on May 25, 2013.

Board Recommendations Not Passed
The provisions of the original Board proposed-bill that drew the most controversy were not ultimately adopted.

First, a new definition of "express advocacy," which moved beyond the "magic words" test, was dropped from the bill. Under the "magic words" test, an expenditure must use election-related language such as "vote for," "vote against," "elect" or "defeat" in order to be considered a campaign expenditure. Under the proposed additional test, language subject to no other interpretation but that it was intended to influence an election would also be considered "express advocacy" and therefore subject to campaign expenditure registration and reporting requirements. The "magic words" test was retained in the new law but the subjective standard was deleted.

Second, the bill would have imposed new reporting requirements for electioneering communications. Electioneering communications would be most paid advertising containing the name of a candidate appearing 60 days before a general election or 30 days before a primary election. Parties engaged in electioneering communications would be required to file a report with the Board regarding such expenditures. There was some criticism that the new provision was unnecessary and burdensome, and it was also dropped from the final bill.

Finally, the Board proposed changing the method for allocating and reporting contributions to independent expenditure committees. When independent expenditure reporting was first required in 2010, three methods were provided for identifying donors. The Board proposed eliminating two of those methods so that proration would be the only acceptable method of attributing general treasury money to independent expenditures. The provision was dropped and the three existing methods for attribution of independent expenditures are retained.

Omnibus Elections Bill (Chapter 131)
One of the key changes made in the Omnibus Election Bill passed this session relates to absentee voting. Under the new law, absentee voting will be permitted for any eligible voter, regardless of the voter's reason for requesting an absentee ballot. Under prior law, voters were required to claim one of several specified excuses for absentee voting. The new law allows the voter to claim permanent absentee voter status, which would result in an absentee ballot application being mailed to the voter before each election.

In early versions, both the House and Senate bills allowed "early voting," meaning that voters could cast their ballots up to 15 days before an election. This provision garnered bi-cameral Republican opposition and was dropped from the bill before passage. Early versions of the bill would also have moved the State's Primary Election from August to June. There was bi-partisan opposition to this provision and it was not included in the bill.

Various technical changes are made to the election administration system in Article 2 of the bill, including changes as a result of the 2010 redistricting. Article 3 of the bill relates to the recommendations of the Task Force on Election Integrity, and the loss and restoration of voting rights for criminals. The Commissioner of Corrections is required to provide electronic data to the Secretary of State regarding individuals on probation for a felony offense that would result in the loss of the right to vote. Law enforcement agencies are required to promptly investigate alleged violation of the laws governing voter registration.

Political Contribution Refund Program Reinstated
In the 2010 special legislative session, the Legislature first suspended the State's political contribution refund (PCR) program for contributions made between July 1, 2009, and July 1, 2011. In the 2011 special legislative session, that suspension of the PCR program was extended to July 1, 2013. Because the 2013 Legislature did not act to extend the suspension of the PCR, it is reinstated effective July 1, 2013. The program is open only for contributions to candidates who have signed a public subsidy agreement and will be available for contributions received on or after July 1, 2013. The amount of the refund is $50 per person, per calendar year or $100 for a married couple filing a joint return.

Minnesota Campaign Finance and Public Disclosure Board Budget (Chapter 142)
The Legislature increased the Board's annual budget from $689,000 per year to $1,000,000 per year in the State Government Finance Bill.

Topics:  Absentee Voting, Campaign Finance Reform, Campaign Spending Limits, Corporate Contributions, New Legislation, Political Campaigns, Political Contributions

Published In: Business Organization Updates, Elections & Politics Updates, Finance & Banking Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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