On October 4, the Federal Election Commission (FEC) issued new guidance on the reporting of political contributions made to nonprofit organizations making certain independent expenditures.

The guidance, released in an FEC press release, was issued in reaction to a federal court’s decision in CREW v FEC, which ruled a campaign finance disclosure regulation followed for decades by the FEC failed to uphold disclosure requirements required by a federal statute.

Chief Judge Beryl A. Howell of the United States District Court for The District of Columbia found the FEC regulation 11 CFR §109.10(e)(1)(vi), did not comport with the statutory disclosure requirements of 52 U.S.C. §30104(c).

The district court found the regulation impermissibly narrowed the mandated disclosure in 52 U.S.C. §30104(c)(2)(C), which requires the identification of donors contributing for the purpose of furthering the non-political committee’s own express advocacy for or against the election of a federal candidate, even when the donor has not expressly directed the funds be used in the precise manner reported.

Lawmakers in the Virginia House of Delegates have canceled a redistricting session scheduled for October 21.

Gov. Ralph Northam has previously stated his intentions to veto the current redistricting proposal, House Bill 7003, if the bill reaches his desk.

Without a legislative solution, the redistricting of House districts will be handled by a court appointed independent party.

Two-term Democratic state Rep. Martin Sweeney resigned from the House on Monday, October 1, with more than two months remaining on his term.

In his resignation letter, Sweeney referred to the next chapter of his professional career but did not state his plans.

Sweeney’s daughter Bride Rose is running to fill the seat. Rose will face Libertarian Ryan McClain in the November election.

Sweeney came to the House after serving as Cleveland City Council president.

Campaign Finance

National: “FEC Guidance to Limit Impact of Dark Money Court Ruling” by Brian Slodysko for Associated Press

National: “Wall Street Pumping Cash Through Loophole in Anti-Corruption Rule” by David Sirota and Chase Woodruff for Capital & Main

Elections

North Carolina: “Is Elections Board Amendment a Victory for Bipartisanship? Or a Recipe for Chaos?” by Jim Morrill for Charlotte Observer

Ethics

Alabama: “Alabama Ethics Commission Drops Case Against ‘Beach House Sheriff’” by Connor Sheets for AL.com

Colorado: “Moonlighting Criticism in Colorado Secretary of State Race Raises New Questions About an Old Practice” by Lars Gesing for Colorado Independent

Delaware: “New Wilmington Ethics Code Strengthens Financial Disclosures, Reduces Penalties” by Christina Jedra for Wilmington News Journal

Hawaii: “Should Public Have More Input on Legislature’s Sexual Harassment Policies?” by Anita Hofschneider for Honolulu Civil Beat

New York: “New York Regulators Examine the Trump Family’s Tax Schemes” by Russ Buettner, Susanne Craig, and David Barstow for New York Times

National:

Missing in the G.O.P.: Black and Hispanic Nominees for Governor
New York Times – Astead Herndon | Published: 10/3/2018

In the first midterm elections under Donald Trump, whose campaign and presidency included strong appeals to white voters, Republicans have no black or Hispanic nominees for governor in 2018, and few from other racial minorities, in the 36 states holding elections for the position. The overwhelming majority are white men. Democrats this year have nominated black, Hispanic, and Native American candidates for governor in Arizona, Florida, Georgia, Idaho, Maryland, and elsewhere. The Republican falloff is striking after past election seasons when party leaders attempted to identify and then rally behind minority candidates for governor in major states, like Ohio and Pennsylvania.

Federal:

Trump Engaged in Suspect Tax Schemes as He Reaped Riches from His Father
MSN – David Barstow, Susanne Craig, and Russ Buettner (New York Times) | Published: 10/2/2018

Donald Trump won the presidency proclaiming himself a self-made billionaire, and he has insisted his father provided almost no financial help. But an investigation reveals Trump received the equivalent today of at least $413 million from his father’s real estate empire, starting when he was a toddler and continuing to this day. Much of this money came to Trump because he helped his parents dodge taxes. He and his siblings set up a sham corporation to disguise millions of dollars in gifts from their parents. Records indicate Trump helped his father take improper tax deductions worth millions of dollars more. He also helped formulate a strategy to undervalue his parents’ real estate holdings by hundreds of millions of dollars on tax returns, reducing the tax bill when those properties were transferred to him and his siblings.

From the States and Municipalities:

Alabama: ‘Beach House Sheriff’ Used Pistol Permit Fees to Pay for TV Commercials During Campaign
AL.com – Connor Sheets | Published: 10/3/2018

Between October 31, 2017, and July, Etowah County Sheriff Todd Entrekin paid Venture Marketing Group more than $29,000 for work related to television ads. Venture created multiple commercials that only aired during the eight months prior to the June primary election. Even though the ads feature Entrekin speaking about the sheriff’s office and promoting programs he oversees as sheriff, his campaign committee did not pay Venture for the work. Entrekin instead paid the company out of an official sheriff’s office account he alone controls called the Sheriff’s Law Enforcement Fund. Nearly half of the money in the fund is generated by selling pistol permits.

Arizona: This Lawmaker Stands to Earn at Least $11M on His Own Charter Schools. His Votes Helped Lay the Groundwork.
Arizona Republic – Craig Harris | Published: 10/2/2018

Arizona House Speaker J.D. Mesnard and Rep. Eddie Farnsworth amended the state budget to exempt charter schools from procurement and conflict-of-interest laws, and from a requirement to disclose their entire annual spending plans on school websites. Farnsworth was not just a lawmaker interested in the details of the bill. He also runs a four-campus charter chain that because of the amendment would remain free of state oversight of its spending. Farnsworth’s involvement in the last-minute maneuver highlights how his roles as a state lawmaker and charter-school operator have for years mingled at the Capitol, almost always to the benefit of Farnsworth and the state’s other charter school operators.

California: Gov. Brown Signs Bill Requiring Lobbyists to Receive Sexual Harassment Prevention Training
San Francisco Chronicle – Bay City News Service | Published: 10/1/2018

California Gov. Jerry Brown signed a bill that requires lobbyists to receive sexual harassment prevention training.  Assembly Bill 2055 requires lobbyists’ ethics courses to include information on Assembly and Senate policies against harassment, including sexual harassment, in connection with lobbying activities. “We need to make sure that everyone who does business in the Capitol understands what we mean by our zero-tolerance policy. Mandated training is an effective method to get that message across,” Assemblyperson Marc Levine said.

California: New State Law Requires More Transparency from Social Media Political Ads
Voice of OC – Brandon Pho | Published: 10/3/2018

California Gov. Jerry Brown signed a social media disclosure bill into law. A separate bill had bolstered the requirements for disclosing the names of the top three funders of ballot measures and independent expenditures on television, radio, and print ads. Assembly Bill 2188 now extends those same requirements to online platforms. Social media platforms that sell ads directly to advertisers will be required to keep a database of any political ad disseminated on the platform by a committee that purchased $500 or more in ads within a year.

Florida:Lobbyists Paid to Pressure County Officials Skip Filing Required Disclosures, Audit Says
Fort Myers News-Press – Bill Smith | Published: 9/29/2018

An audit found nearly 60 percent of registered lobbyists in Lee County, Florida have missed the required filing of annual or quarterly statements on their activities. The county ordinance covers contact with county commissioners and employees at the director level and above to report contacts with anyone who is paid to “influence the passage, defeat, modification or repeal,” of any matter requiring a commission vote. It also includes non-secretarial employees in the purchasing division and contracts office. Companies that employee lobbyists are required to file an annual registration statement and quarterly statements about lobbying activities.

Kentucky: Ethics Bill Seeks to Close Reporting Loophole on Groups Paying for Legislators’ Travel
Insider Louisville – Joe Sonka | Published: 9/27/2018

An ethics bill pre-filed in Kentucky could close a reporting loophole that allowed groups, including partisan advocacy organizations, to prepay for the out-of-state travel and lodging expenses of state legislators. A recent investigation estimated that up to $100,000 was spent by outside groups on lawmakers’ approved travel outside of the state last year; that spending did not have to be reported to any state agency. While public funds spent on such travel and reimbursements from private groups must be reported, there is no requirement for legislators to disclose how much those organizations spend to send them to conferences and events, so long as such groups pay for the airfare, lodging, and meals in advance.

Mississippi: In Mississippi Senate Race, an African American Democrat Faces a Republican Using a Confederate Symbol
Washington Post – Cleve Wootson Jr. | Published: 9/30/2018

U.S. Senate candidate Mike Espy has tried to remind Mississippians how he has served them in the past, with three terms in the U.S. House who spent time as President Clinton’s agriculture secretary. But even his most ardent supporters worry that when many voters go to the polls in November, what Espy has done will matter much less than what he is: a black man running for one of the highest elected offices in a state with a Confederate emblem on its flag. One of his opponents is hearkening to another version of the past: Republican Chris McDaniel, a conservative fond of provocative statements whose yard signs feature the flag of the Confederate States of America.

New Jersey: Murphy Still Defends Hiring Ex-Official Jailed for Corruption (Even Though He Was Forced to Resign)
Newark Star Ledger – Brent Johnson (NJ Advance Media) | Published: 10/2/2018

Gov. Phil Murphy  continued to defend his administration’s decision to hire a former Passaic City Council member who served prison time for accepting bribes, even after the hiring was deemed unlawful and Marcellus Jackson was forced to resign. Murphy hired Jackson in July for a $70,000-a-year position as a special assistant in the state Department of Education’s Office of Civic and Social Engagement. Murphy said his administration conducted a legal review that cleared Jackson’s hiring. But Attorney General Gurbir Grewal said state law should have prevented the hire because former public officials convicted of corruption are disqualified from ever holding a public job again in New Jersey.

Pennsylvania: Alex Trebek Moderated a Gubernatorial Debate in Pennsylvania. It Didn’t Go Well.
Chicago Tribune – Antonia Noori Farzan (Washington Post) | Published: 10/2/2018

Pennsylvania Gov. Tom Wolf and his Republican challenger, Scott Wagner, met recently in their only debate prior to the November election with “Jeopardy” host Alex Trebek serving as moderator. While moderators typically ask questions and let the candidates talk, Trebek spoke at length – at times sharing his own policy opinions – during the 45-minute debate, frustrating viewers. At one point, Trebek joked that the only thing with a lower approval rating than the Pennsylvania Legislature was the Catholic Church. Polite laughter from the audience turned to boos. On Twitter, the consensus was that Trebek should stick to his day job.

Tennessee: In Tennessee Senate Race, Financial Missteps Linger in the Background
New York Times – Danny Hakim | Published: 10/3/2018

U.S. Rep. Marsha Blackburn, the Republican candidate for an open Senate seat in Tennessee, has faced questions about her spending practices. In her years as a member of Congress, she has paid out more than $370,000 from her campaign funds to her daughter and son-in-law or firms they control. Her campaigns have received 54 requests for additional information from the FEC since 2002, and in a 2008 audit, the campaign admitted receiving nearly $400,000 in unreported contributions and expenditures. Her opponent, Phil Bredesen, has had his own financial misstep. A longtime booster of the solar industry as governor, he started a solar company with two of his aides during his last year in office. After he left office, the business went on to reap some of the tax breaks the Bredesen administration had put in place.

Vermont: Governor’s Business Ties Violate State Ethics Code, Commission Finds
VTDigger.org – Mark Johnson | Published: 10/2/2018

Vermont Gov. Phil Scott violated the ethics code by maintaining an ongoing financial relationship with a company doing business with the state, according to the Vermont State Ethics Commission. Under political pressure, Scott sold his interest in Dubois Construction back to the company after he took office in 2017. Scott received no cash at the time of the transaction and is still owed $2.5 million by the company. The commission said the conflict arose when Dubois won a two-year contract for $250,000 in 2017, which the panel said “provides significant income to the company, and directly assists the company in meeting its financial obligation to the public official.”

Washington: Washington Court Upholds Fine Against Anti-GMO Group
Capital Press – Don Jenkins | Published: 10/3/2018

An appeals court affirmed that Food Democracy Now must pay a $319,281 fine for not reporting the names of more than 7,000 donors who supported a food labeling initiative in 2013. The court rejected the group’s argument that it should not have been convicted because it did not intentionally hide the donations. Judge Rich Melnick said the law does not make an exception for unintentionally concealing the source of campaign contributions. The fine stemmed from Initiative 522, which would have required food and beverage makers to label products with genetically modified ingredients.

Sen. Rob Shadoin, a republican representing the state’s Ruxton area, announced he will resign his seat in the legislature and take a position with the Louisiana Department of Wildlife and Fisheries.

Shadoin is currently serving the third year of his second term and is known as a moderate republican lawmaker and consistent ally of Gov. John Bel Edwards.

Once a resignation date has been announced, the state will likely call a special election to fill his seat.

The Wisconsin Legislature plans to call an extraordinary session to allow the Senate to consider a bill authorizing $100 million in tax incentives to prevent paper giant Kimberly-Clark from shutting down.

If passed, Assembly Bill 963 would authorize Kimberly-Clark to claim as income and franchise tax credits a percentage of the business’s eligible payroll for full-time employees.

Gov. Scott Walker said he is fighting to keep hundreds of jobs in Wisconsin. The extraordinary session will be held on Monday, November 12.

Campaign Finance

Alabama: “‘Beach House Sheriff’ Used Pistol Permit Fees to Pay for TV Commercials During Campaign” by Connor Sheets for AL.com

New Mexico: “Patrick Lyons Fundraising for Land Commissioner Campaign Raises Legal and Ethical Questions” by Elizabeth Miller for New Mexico In Depth

Washington: “Washington Court Upholds Fine Against Anti-GMO Group” by Don Jenkins for Capital Press

Elections

National: “Missing in the G.O.P.: Black and Hispanic Nominees for Governor” by Astead Herndon for New York Times

Massachusetts: “Galvin Accused of Mixing Politics with Voter Guide” by Christian Wade for Salem News

Missouri: “Jason Kander Ends Campaign for Kansas City Mayor to Focus on Depression, PTSD” by Steve Vockrodt, Bill Turque, and Mike Hendricks for Kansas City Star

Ethics

National: “Trump Engaged in Suspect Tax Schemes as He Reaped Riches from His Father” by David Barstow, Susanne Craig, and Russ Buettner (New York Times) for MSN

Kentucky: “Beshear Appoints Independent Counsel to Investigate Allegations Against Grimes” by Daniel Desrochers for Lexington Herald-Leader

Tennssee: “In Tennessee Senate Race, Financial Missteps Linger in the Background” by Danny Hakim for New York Times

Vermont: “Governor’s Business Ties Violate State Ethics Code, Commission Finds” by Mark Johnson for VTDigger.org

On November 15, the California Fair Political Practices Commission (FPPC) will consider proposed regulations to make biennial cost of living adjustments to campaign contribution and gift limits that will apply from January 1, 2019, through December 31, 2020.

The proposed regulations would change the gift limit from $470 to $500 and make increases to campaign contribution limits for candidates. Adjusted contribution limits for gubernatorial candidates would increase from $29,200 to $31,000 per person.

The FPPC is accepting written comments on the proposals until November 13, 2018.

Sometime before March 30, 2019, a by-election will be announced for the seat in the House of Commons representing York–Simcoe in the province of Ontario.

On October 2, the Chief Electoral Officer of Canada, Stéphane Perrault, received official notice from the Speaker of the House of Commons that the seat for York–Simcoe (Ontario) became vacant following the resignation of Peter Van Loan, who resigned on September 30. Van Loan plans to return to the practice of law, according to Bradford Today.

Under the law, the by-election date must be announced between October 12, 2018, and March 30, 2019, and will signal the start of the by-election period. According to Elections Canada, the earliest date the by-election can be held is November 19, 2018.

Campaign Finance

Massachusetts: “After Baker Tasked Eversource with Merrimack Valley Response, Executives Cut Checks to His Campaign” by Matt Stout for Boston Globe

Washington: “Pursuit of Campaign-Spending Violations Breaks the Budget” by Jerry Cornfield for Everett Daily Herald

Elections

National: “Alex Trebek Moderated a Gubernatorial Debate in Pennsylvania. It Didn’t Go Well.” by Antonia Noori Farzan for Washington Post

Ethics

Arizona: “This Lawmaker Stands to Earn at Least $11M on His Own Charter Schools. His Votes Helped Lay the Groundwork.” by Craig Harris for Arizona Republic

Maryland: “Lobbyist Who Wrote Draft Bill to Expand Liquor Sales in Pr. George’s Sentenced in Bribery Scheme” by Lynn Bui for Washington Post

New Jersey: “Murphy Still Defends Hiring Ex-Official Jailed for Corruption (Even Though He Was Forced to Resign)” by Brent Johnson (NJ Advance Media) for Newark Star Ledger

New Mexico: “Report Finds Gaps in Financial Disclosures in New Mexico Legislature” by Andrew Oxford for Santa Fe New Mexican

Lobbying

California: “Gov. Brown Signs Bill Requiring Lobbyists to Receive Sexual Harassment Prevention Training” by Bay City News Service for San Francisco Chronicle

South Dakotans will have multiple ethics-related ballot measures to vote on this November.

Constitutional Amendment W, also known as the South Dakota Voter Protection and Anti-Corruption Amendment, would create an independent ethics commission, decrease limits on campaign donations, bar gifts from lobbyists to many public officials, and prevent the Legislature from altering or rejecting laws approved by ballot question without returning to the ballot.

More than 51 percent of voters supported a similar initiative in November 2016, but lawmakers repealed it in early 2017, citing constitutional concerns.

Also on the November ballot, Initiated Measure 24, would prohibit contributions to ballot question committees by non-residents, out-of-state political committees, and entities who have not filed with the secretary of state for the four years prior to making a contribution.

On September 30, California Gov. Jerry Brown signed a bill requiring lobbyists to complete training on sexual harassment in connection with lobbying activities.

Assembly Bill 2055 adds a component to training already required for lobbyists registered with the state and conducted by the ethics committees in both houses of the California Legislature.

The lobbyist training course now must include “information on each house of the Legislature’s policies against harassment, including sexual harassment, in connection with lobbying activities.”

Campaign Finance

California: “Inglewood Mayor’s Campaign Loaned Nearly $160,000 to a Political Ally. None of It Has Been Paid Back” by Benjamin Oreskes for Los Angeles Times

Massachusetts: “State Police Union President Pullman Resigns Amid New Federal Probe” by Andrea Estes and Matt Rocheleau for Boston Globe

Elections

National: “In Mississippi Senate Race, an African American Democrat Faces a Republican Using a Confederate Symbol” by Cleve Wootson Jr. for Washington Post

Ethics

National: “Congressional Democrats’ Lawsuit Alleging Trump’s Private Business Is Violating the Constitution Can Proceed, Federal Judge Rules” by Jonathan O’Connell, David Fahrenthold, and Carol Leonnig (Washington Post) for MSN

New Mexico: “AG: Youngblood abused position in DWI stop” by Dan Boyd for Albuquerque Journal

Texas: “Are Christi Craddick’s Deep Ties with Oil and Gas a Conflict of Interest?” by Asher Price for Austin American-Statesman

Washington: “Rape Allegation by Seattle Woman Against State Sen. Joe Fain Leads to Calls for Investigation” by Joseph O’Sullivan, Heidi Groover, and Jim Brunner for Seattle Times

Lobbying

Florida: “Lobbyists Paid to Pressure County Officials Skip Filing Required Disclosures, Audit Says” by Bill Smith for Fort Myers News-Press