September 29, 2005, Introduced by Reps. Tobocman, Kolb, Bieda, Murphy, Meisner, Hopgood, Drolet, Vagnozzi, Polidori, Kehrl, Ward, Kathleen Law, Condino, Kooiman, Proos and Lemmons, III and referred to the Committee on House Oversight, Elections, and Ethics.
A bill to regulate political activity; to regulate certain
candidates for elective office and state officials; to require
financial statements and reports; to prescribe the powers and
duties of certain state and local governmental officers and
agencies; to impose fees; to prescribe penalties and civil
sanctions; and to provide remedies.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"financial disclosure act".
Sec. 2. As used in this act:
(a) "Candidate" means that term as defined in section 3 of the
Michigan campaign finance act, 1976 PA 388, MCL 169.203.
(b) "Candidate for state office" means a candidate for any of
the following:
(i) The office of governor.
(ii) The office of lieutenant governor.
(iii) The office of attorney general.
(iv) The office of secretary of state.
(v) The office of state senator.
(vi) The office of state representative.
(vii) The office of head of a principal department as provided
in section 3 of article V of the state constitution of 1963, if the
office is filled by election.
(viii) The office of a member of a board or commission heading a
principal department as provided in section 3 of article V of the
state constitution of 1963, if the office is filled by election.
(ix) The office of judge of a court of record.
(x) The office of regent of the university of Michigan, member
of the board of trustees of Michigan state university, or member of
the board of governors of Wayne state university.
(c) "Earned income" means salaries, tips, and other employee
compensation, and net earnings from self-employment for the taxable
year.
(d) "Immediate family" means a child residing in an
individual's household, a spouse of an individual, or a person
claimed by that individual or that individual's spouse as a
dependent for federal income tax purposes.
(e) "Income" means money or any thing of value received, or to
be received as a claim on future services, whether in the form of a
fee, salary, expense, allowance, forbearance, forgiveness,
interest, dividend, royalty, rent, capital gain, or any other form
of recompense that is considered income under the internal revenue
code, 26 USC 1 to 1789.
(f) "Secretary of state" means the secretary of state or the
designee of the secretary of state.
(g) "State official" means all of the following:
(i) The holder of an office described in subdivision (b).
(ii) The head of each principal department as provided in
section 3 of article V of the state constitution of 1963, if the
office is filled by appointment.
(iii) A member of a board or commission heading a principal
department as provided in section 3 of article V of the state
constitution of 1963, if the office is filled by appointment.
Sec. 3. (1) If an individual was a state official at any time
during a calendar year, that individual shall file with the
secretary of state by May 1 of the following year a report that
meets the requirements of section 4 unless that individual is no
longer a state official.
(2) If an individual is a candidate for state office and has
not already filed a report under subsection (1) covering the
preceding calendar year, that individual shall file with the
secretary of state a report that meets the requirements of section
4 within 30 days after whichever of the following events is
applicable, but not later than 11 days before the first election at
which the individual's name appears on the ballot as a candidate
following the event:
(a) If the individual files a fee, affidavit of incumbency, or
nominating petition for the state office, the deadline for filing
the fee, affidavit of incumbency, or nominating petition
established by the Michigan election law, 1954 PA 116, MCL 168.1 to
168.992.
(b) If the individual is nominated at a political party caucus
or convention, the deadline for holding the caucus or convention
established by the Michigan election law, 1954 PA 116, MCL 168.1 to
168.992.
Sec. 4. Subject to section 5 and except as provided in section
6, a report required by section 3 shall include a complete
statement of all of the following:
(a) The name of each member of the immediate family of the
individual filing the report.
(b) The name and address of each employer of the individual
filing the report during the calendar year covered by the report.
(c) Both of the following, as applicable:
(i) The source, type, and amount or value of earned income
received during the preceding calendar year by the individual
filing the report if the total earned income from that source
equals $1,000.00 or more during that calendar year.
(ii) The source and type of earned income received during the
preceding calendar year by the spouse of the individual filing the
report if the total earned income from that source equals $1,000.00
or more during that calendar year.
(d) The source, type, and amount or value of all other income
not reported under subdivision (c) that is received during the
preceding calendar year by the individual filing the report or a
member of the immediate family of that individual if the total
income from that source equals $1,000.00 or more during that
calendar year.
(e) The identity and value of each asset held during the
preceding calendar year by the individual filing the report or a
member of the immediate family of that individual, including real
or personal property or cash, if the asset had a fair market value
of $1,000.00 or more at any time the asset was held during the
preceding calendar year. However, if the individual filing the
report owns or has an interest in all or a portion of a farm or
business, the identity and value of each asset held during the
preceding year that is used in the operation of the farm or
business is not required to be reported under this subdivision if
the report includes a complete statement of the identity and value
of the farm or business.
(f) The identity and value of each liability owed during the
preceding calendar year by the individual filing the report or a
member of the immediate family of that individual if the amount of
the liability was $10,000.00 or more at any time during the
preceding calendar year. This subdivision does not apply to a loan
secured by the personal residence of the individual filing the
report or by a personal motor vehicle, household furniture, or
appliance, if the loan does not exceed the purchase price of the
item that secures the liability.
(g) A brief description and value of a purchase, sale, or
exchange of real property, other than real property used solely as
a personal residence by the individual filing the report and his or
her immediate family, or of stocks, bonds, commodities, futures, or
other forms of securities during the preceding calendar year by the
individual filing the report or a member of the immediate family of
that individual, if the value is $1,000.00 or more. This
subdivision does not require a description of each purchase, sale,
or exchange of stocks, bonds, commodities, or other forms of
securities if those items are part of a mutual fund and if the
identity and value of the mutual fund is otherwise reported under
this act.
(h) Except as otherwise provided by this subdivision, the
identity of all positions held by the individual filing the report
during the preceding calendar year as an officer, director,
trustee, partner, proprietor, representative, employee, or
consultant of a corporation, partnership, or other business
enterprise; of a nonprofit organization; of a labor organization;
or of an educational or other institution. An individual filing the
report who is required to have a license to practice or engage in a
particular occupation or profession is not required to identify a
position held as a consultant of a corporation unless the
corporation is a publicly held corporation that has shares that are
listed or traded over the counter or on an organized exchange or
has gross revenues over $4,000,000.00. This subdivision does not
require the reporting of a position held in a religious, social,
fraternal, or political entity, or of a position solely of an
honorary nature.
(i) If the individual filing the report has an agreement or
has made an arrangement with respect to future employment, a leave
of absence during that individual's term of office, continuation of
payments by a former employer, or continuation of participation in
an employee benefit plan maintained by a former employer, a
description of the agreement or arrangement, including the dates,
parties, and terms.
Sec. 5. (1) An amount or value reported under section 4(c),
(d), (e), or (g) shall be reported by category as follows:
(a) $1,000.00 or more but less than $10,000.00.
(b) $10,000.00 or more but less than $50,000.00.
(c) $50,000.00 or more but less than $100,000.00.
(d) $100,000.00 or more but less than $500,000.00.
(e) $500,000.00 or more.
(2) An amount or value reported under section 4(f) shall be
reported by category as follows:
(a) $10,000.00 or more but less than $50,000.00.
(b) $50,000.00 or more but less than $100,000.00.
(c) $100,000.00 or more but less than $500,000.00.
(d) $500,000.00 or more.
Sec. 6. A report under section 4 may omit any of the
following:
(a) Information required to be reported under the Michigan
campaign finance act, 1976 PA 388, MCL 169.201 to 169.282.
(b) A liability owed to the individual filing the report or a
relative within the third degree of consanguinity to that
individual if lent by the individual filing the report or a
relative within the third degree of consanguinity to that
individual.
(c) An item otherwise required to be reported under section
4(e), (f), or (g) if all of the following apply:
(i) The item represents the sole financial interest and
responsibility of a member of the immediate family of the
individual filing the report about which the individual filing the
report does not have actual knowledge.
(ii) The item is not in any way, past or present, derived from
the income, assets, or activities of the individual filing the
report.
(iii) The individual filing the report does not derive, or
expect to derive, financial benefit from the item.
(d) An item that concerns a spouse who is living separate and
apart from the individual filing the report with the intention of
terminating the marriage or maintaining a legal separation.
(e) An item that concerns income or obligations of the
individual filing the report arising from dissolution of his or her
marriage or a permanent legal separation from his or her spouse.
(f) Compensation from a publicly held corporation that has
shares that are listed or traded over the counter or on an
organized exchange paid to a business owned by the individual
filing the report or in which the individual filing the report has
an interest, if the report under section 4 includes a complete
statement of the identity and value of that business and the
individual filing the report is required to have a license as
described in section 4(h).
Sec. 7. The secretary of state shall do all of the following:
(a) Prepare and make available appropriate forms and
instructions for the reports required by this act.
(b) Receive reports required by this act.
(c) As soon as practicable, but not later than the end of the
business day on which a report required to be filed under this act
is received, make the report or all of the contents of the report
available without charge to the public on the internet at a single
website established and maintained by the secretary of state, and
not later than the third business day following the day on which
the report is received, make the report available for public
inspection and reproduction during regular business hours.
(d) Promulgate rules and issue declaratory rulings to
implement this act pursuant to the administrative procedures act of
1969, 1969 PA 306, MCL 24.201 to 24.328.
(e) Conduct investigations as necessary to determine whether
there is reason to believe that a violation of this act occurred.
Investigations shall be conducted pursuant to the administrative
procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
Sec. 8. (1) A citizen of this state may file a complaint with
the secretary of state alleging a violation of this act. The
secretary of state, upon receipt of a complaint, shall investigate
the allegations as provided in section 7.
(2) If the secretary of state, upon investigation, determines
that there is reason to believe a violation of this act occurred,
the secretary of state shall forward the results of that
investigation to the attorney general for enforcement of this act.
(3) The attorney general shall enforce this act against an
individual who violates this act.
Sec. 9. (1) An individual who fails to file a report as
required under this act shall pay a late filing fee not to exceed
$1,000.00, determined as follows:
(a) Twenty-five dollars for each of the first 3 business days
that the report remains unfiled.
(b) Fifty dollars for each of the next 7 business days after
the first 3 business days that the report remains unfiled.
(c) One hundred dollars for each business day after the first
10 business days that the report remains unfiled.
(2) If an individual required to file a report under this act
knowingly files an incomplete or inaccurate report, the individual
is guilty of a misdemeanor punishable by a fine of not more than
$1,000.00 or imprisonment for not more than 90 days, or both.
(3) If an individual required to file a report under this act
fails to file 2 reports and if both of the reports remain unfiled
for more than 30 days, the individual is guilty of a misdemeanor
punishable by a fine of not more than $1,000.00 or imprisonment for
not more than 90 days, or both.
(4) A default in the payment of a fee or civil fine due or
ordered under this act, or an installment of the fee or fine, may
be remedied by any means available under the revised judicature act
of 1961, 1961 PA 236, MCL 600.101 to 600.9947.