Five Takeaways from HB 333, the Ethics in Government Act of 2021
The bipartisan Ethics in Government Act of 2021, HB 333, has passed out of the Georgia State House Judiciary Committee and is currently making its way through the statehouse. As someone who has practiced and followed this area of law, I’ll share just a few of my thoughts on the bill.
Quick Summary
The bill in its current form:
- Amends the procedures by which the Georgia Government Transparency and Campaign Finance Commission (the Commission) may initiate an investigation, and requires complaints alleging rules violations be (1) made by a staff attorney employed by the Commission, (2) in writing, and (3) verified under oath;
- Clarifies the statute of limitations for actions alleging a violation of campaign finance law to three years after the date the violation occurred, or five years after the offending act if it involves any person elected to serve a term of four years or more;
- Defines and categorizes the record retention policy for campaign depository accounts;
- Expressly restricts candidates and public office holders from using excess contributions to make loans or investments directly to a candidate’s business, candidate’s trusts, nonprofit organization of which the candidate is on the payroll or has a controlling interest, or candidate’s family member; and
- Requires public officers and candidates for public office to include with their financial disclosures, a statement of their financial dealings covering the five years prior to the year the election is held.
Commission-initiated Investigations
Because the era of hyper-partisanship will likely be around for the foreseeable future, transparency and clarity in the way in which Commission-initiated complaints are handled is a step in the right direction. One need only to look at the aftermath of the contentious 2018 gubernatorial election between now-Governor Brian Kemp and Stacey Abrams. Immediately following the election, news broke that the Commission was investigating Abrams’ campaign and two other groups tied to Abrams for alleged violations of campaign finance law. Regardless of whether the allegations were supported by substantial evidence, a war of words ensued between the newly appointed executive director of the Commission and supporters of Abrams’ campaign. The timing of the allegations coupled with the raw emotions left after such a contentious election cycle did nothing but fan the flames of distrust and furthered the existing partisan divide. HB 333 seeks to address this issue by requiring a licensed attorney employed by the Commission to follow the same complaint procedures as those outside the Commission. I should also note that the bill limits the Commission’s inquiry to only the information expressly required to be reported on campaign contribution disclosure reports or personal financial disclosure statements.
Statute of Limitations & Record Retention
Under the current version of HB 333, complaints alleging campaign finance violations have to be raised within three years after the offending act or omission occurred; five years if the alleged violation involved a candidate or person elected to serve a term of four or more years. The bill goes on to extend the time campaigns are required to maintain depository account records to between three to seven years depending on the term of the public office. With these provisions, the sponsors of this bill appear to recognize and attempt to resolve two glaring issues with the current law’s requirements. Recent news stories highlight the inefficiency and ineffectiveness of the law in its current state. Even now, there are currently court cases involving candidate disclosure reports from a decades-old election cycle. Under current law, campaigns are only required to maintain records for up to three years following the termination date of the campaign. I believe these provisions will benefit both candidates and the Commission in the long run and bring about better efficiency in the timing and manner in which ethics complaints are investigated and prosecuted.
Excess Campaign Contributions
As if in direct response to several scandalous news stories, the bill’s sponsors endeavor to seal the gaps in the current law relating to the use of excess contributions. The bill expressly prohibits a candidate campaign committee from using excess funds to make loans or investments directly to “the candidate, the candidate’s business, candidate’s trust, any nonprofit organization of which the candidate is on the payroll of or has a controlling interest, or a member of the family of the candidate.” Obviously, the bill seeks to prevent candidates and elected officials from using campaign accounts as slush personal funds. But the language of the current bill strikes a much more subdued tone than the language used in the prior version of this bill. While it is a valiant first attempt, I am curious to see if this provision will remain in the final version of the bill. I should also note the statute defines “Member of the family” to mean “a spouse and all dependent children.” This leaves the door open to parents, adult siblings, non-dependent children, and other relatives and or friends of the candidate to receive loans and investments from campaign coffers.
Financial Disclosure Reports
The last, and likely the least noticed provision of HB 333, is the expansion of the period in which a candidate or public official’s financial disclosure statements must cover from a year to five years prior to the year the election is held. I am generally supportive of the concept of transparency and allowing the public to decide whether a candidate or elected official’s financial interests should preclude him or her from holding public office. However, I am less supportive of attempts to use the rule of law to probe into areas of a candidate or elected official’s life that has little relevance to his or her ability to perform official duties. The composition of the American body politic is built on the premise that with few exceptions, any citizen who chooses to run for public office must open themselves up to a certain level of public scrutiny. However, with such an overboard rule, individuals may be deterred from participating in the political process if they are required to disclose financial shortcomings that were resolved half a decade prior to deciding to run for office. In my estimation, requiring five years of financial records from a candidate’s time as a private citizen is oppressive and unnecessary to achieve the stated intent of the law. There is a balance between serving the public interest by requiring the disclosure of a candidate or public official’s relevant financial interests and protecting citizen representative’s personal information from excessive scrutiny and harassment.
Final Thoughts
All in all, I am amenable to the proposed changes to Georgia’s campaign finance laws and I am interested in seeing how the State Senate will respond to the bill. I am curious to see if we will see a conference committee bill incorporating provisions of HB 333 and SB 221 on Sine Die. Stay tuned to my blog and social media channels for more updates as this and similar bills progress the 2021 legislative session. If after reading this you have questions specific to your situation, please scheduled a consultation.
Attorney Jenn McNeely has held legal positions in all three branches of state government. She’s has served as a legal advisor to state and federal candidates, political action committees (PACs), and independent committees on compliance matters pertaining to campaign finance and election law, administrative law, statutory interpretation, and regulatory & government affairs on the federal and state level. If you have questions regarding campaign finance compliance, schedule a consultation with Jenn today.