TITLE 1.ADMINISTRATION

Part 2. TEXAS ETHICS COMMISSION

Chapter 12. SWORN COMPLAINTS

Subchapter A. GENERAL PROVISIONS AND PROCEDURES

1 TAC §12.27

The Texas Ethics Commission proposes new §12.27, relating to deadline extensions for sworn complaints.

Section 12.27 would give the executive director the authority to extend sworn complaint deadlines pursuant to §571.136 of the Government Code.

David A. Reisman, Executive Director, has determined that for each year of the first five years that the rule is in effect there will be no fiscal implication for the state and no fiscal implication for local government as a result of enforcing or administering the rule as proposed. Mr. Reisman has also determined that the rule will have no local employment impact.

Mr. Reisman has also determined that for each year of the first five years the rule is in effect, the anticipated public benefit will be clarity in what is required by the law.

Mr. Reisman has also determined there will be no direct adverse effect on small businesses or micro-businesses because the rule does not apply to single businesses.

Mr. Reisman has further determined that there are no economic costs to persons required to comply with the rule.

The Texas Ethics Commission invites comments on the proposed rule from any member of the public. A written statement should be mailed or delivered to Natalia Luna Ashley, Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070, or by facsimile (FAX) to (512) 463-5777. A person who wants to offer spoken comments to the commission concerning the proposed rule may do so at any commission meeting during the agenda item "Communication to the Commission from the Public" and during the public comment period at a commission meeting when the commission considers final adoption of the proposed rule. Information concerning the date, time, and location of commission meetings is available by telephoning (512) 463-5800 or, toll free, (800) 325-8506.

The new section is proposed under Government Code, Chapter 571, §571.062, which authorizes the commission to adopt rules concerning the laws administered and enforced by the commission.

The proposed new section affects §571.136 of the Government Code.

§12.27.Deadline Extension.

The executive director may extend a deadline pursuant to §571.136 of the Government Code.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on May 18, 2006.

TRD-200602822

Natalia Luna Ashley

General Counsel

Texas Ethics Commission

Earliest possible date of adoption: July 2, 2006

For further information, please call: (512) 463-5800

Subchapter E. FORMAL HEARING

1 TAC §12.117

The Texas Ethics Commission proposes new §12.117, relating to formal hearings for sworn complaints.

Section 12.117 would clarify §571.121 of the Government Code regarding the proper venue for a formal hearing held under the sworn complaint process. Section 571.121 of the Government Code authorizes the commission to "hold hearings" without limiting the type of hearings the commission may hold. The rule would provide that the commission may hold a formal hearing either before the commission or before the State Office of Administrative Hearings (SOAH).

David A. Reisman, Executive Director, has determined that for each year of the first five years that the rule is in effect there will be no fiscal implication for the state and no fiscal implication for local government as a result of enforcing or administering the rule as proposed. Mr. Reisman has also determined that the rule will have no local employment impact.

Mr. Reisman has also determined that for each year of the first five years the rule is in effect, the anticipated public benefit will be clarity in what is required by the law.

Mr. Reisman has also determined there will be no direct adverse effect on small businesses or micro-businesses because the rule does not apply to single businesses.

Mr. Reisman has further determined that there are no economic costs to persons required to comply with the rule.

The Texas Ethics Commission invites comments on the proposed rule from any member of the public. A written statement should be mailed or delivered to Natalia Luna Ashley, Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070, or by facsimile (FAX) to (512) 463-5777. A person who wants to offer spoken comments to the commission concerning the proposed rule may do so at any commission meeting during the agenda item "Communication to the Commission from the Public" and during the public comment period at a commission meeting when the commission considers final adoption of the proposed rule. Information concerning the date, time, and location of commission meetings is available by telephoning (512) 463-5800 or, toll free, (800) 325-8506.

The new section is proposed under Government Code, Chapter 571, §571.062, which authorizes the commission to adopt rules concerning the laws administered and enforced by the commission.

The proposed new section affects Chapter 571 of the Government Code.

§12.117.Formal Hearing: Venue.

When the commission orders a formal hearing the commission shall decide whether the formal hearing will be held before the commission or before the State Office of Administrative Hearings.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on May 18, 2006.

TRD-200602823

Natalia Luna Ashley

General Counsel

Texas Ethics Commission

Earliest possible date of adoption: July 2, 2006

For further information, please call: (512) 463-5800

Chapter 18. GENERAL RULES CONCERNING REPORTS

1 TAC §18.9

The Texas Ethics Commission proposes an amendment to §18.9, relating to corrected reports.

Section 18.9 relates to the filing of corrected reports. Currently, §18.9(c) provides instances in which a corrected report is not considered late for purposes of a late fine. That provision is no longer needed because it was superseded by statutory changes made by H.B. 1800, 79th Legislature, Regular Session. The proposed rule would include a reference to the relevant sections of the law relating to "substantial compliance."

David A. Reisman, Executive Director, has determined that for each year of the first five years that the rule is in effect there will be no fiscal implication for the state and no fiscal implication for local government as a result of enforcing or administering the rule as proposed. Mr. Reisman has also determined that the rule will have no local employment impact.

Mr. Reisman has also determined that for each year of the first five years the rule is in effect, the anticipated public benefit will be clarity in what is required by the law.

Mr. Reisman has also determined there will be no direct adverse effect on small businesses or micro-businesses because the rule does not apply to single businesses.

Mr. Reisman has further determined that there are no economic costs to persons required to comply with the rule.

The Texas Ethics Commission invites comments on the proposed rule from any member of the public. A written statement should be mailed or delivered to Natalia Luna Ashley, Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070, or by facsimile (FAX) to (512) 463-5777. A person who wants to offer spoken comments to the commission concerning the proposed rule may do so at any commission meeting during the agenda item "Communication to the Commission from the Public" and during the public comment period at a commission meeting when the commission considers final adoption of the proposed rule. Information concerning the date, time, and location of commission meetings is available by telephoning (512) 463-5800 or, toll free, (800) 325-8506.

The amendment is proposed under Government Code, Chapter 571, §571.062, which authorizes the commission to adopt rules concerning the laws administered and enforced by the commission.

The amendment affects §571.0771 of the Government Code and §305.033 of the Government Code.

§18.9.Corrected Reports.

(a) A filer may correct a report filed with the commission or a local filing authority at any time.

(b) A corrected report must clearly identify how the corrected report is different from the report being corrected.

[ (c) A report that is corrected is not considered late for purposes of any late fine if:]

[ (1) the original report was filed by the applicable filing deadline;]

[ (2) the original report substantially complies with the applicable law;]

[ (3) the corrected report is filed not later than the 14th business day after the date the person learns that the report as originally filed is inaccurate or incomplete; and]

[ (4) the corrected report is complete and accurate.]

(c) [ (d) ] A filer who files a corrected report must submit an affidavit identifying the information that was corrected.

(d) A corrected report is not subject to a late fine if filed in accordance with Sections 571.0771 and 305.033(f) of the Government Code, as applicable.

(e) This section does not apply to a corrected report filed under Section 571.069, Government Code, or a corrected report filed in response to a sworn complaint.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on May 18, 2006.

TRD-200602821

Natalia Luna Ashley

General Counsel

Texas Ethics Commission

Earliest possible date of adoption: July 2, 2006

For further information, please call: (512) 463-5777

Chapter 20. REPORTING POLITICAL CONTRIBUTIONS AND EXPENDITURES

Subchapter A. GENERAL RULES

1 TAC §20.1

The Texas Ethics Commission proposes an amendment to §20.1, relating to definitions.

Section 20.1 relates to Title 15 of the Election Code definitions. The proposed amendment deletes the parts of definitions that are an exact duplicate of the statute. Those parts are unnecessary and confusing. The proposal also amends the definition of campaign communication and the definition of political advertising that a communication made by e-mail is not included in those definitions.

David A. Reisman, Executive Director, has determined that for each year of the first five years that the amendment is in effect there will be no fiscal implication for the state and no fiscal implication for local government as a result of enforcing or administering the amendment as proposed. Mr. Reisman has also determined that the amendment will have no local employment impact.

Mr. Reisman has also determined that for each year of the first five years the amendment is in effect, the anticipated public benefit will be clarity in the law.

Mr. Reisman has also determined that there will be no direct adverse effect on small businesses or micro-businesses because the rule does not apply to single businesses.

Mr. Reisman has further determined that there are no economic costs to persons required to comply with the amended rule.

The Texas Ethics Commission invites comments on the proposed amendment from any member of the public. A written statement should be mailed or delivered to Natalia Luna Ashley, Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070, or by facsimile (FAX) to (512) 463-5777. A person who wants to offer spoken comments to the commission concerning the proposed amendment may do so at any commission meeting during the agenda item "Communication to the Commission from the Public" and during the public comment period at a commission meeting when the commission considers final adoption of the proposed amendment. Information concerning the date, time, and location of commission meetings is available by telephoning (512) 463-5800 or, toll free, (800) 325-8506.

The amendment is proposed under Government Code, Chapter 571, §571.062, which authorizes the commission to adopt rules concerning the laws administered and enforced by the commission.

The proposed amendment affects §251.001(16) and (17) of the Election Code.

§20.1.Definitions.

The following words and terms, when used in Title 15 of the Election Code, in this chapter, Chapter 22 of this title (relating to Restrictions on Contributions and Expenditures), and Chapter 24 of this title (relating to Restrictions on Contributions and Expenditures Applicable to Corporations and Labor Organizations), shall have the following meanings, unless the context clearly indicates otherwise.

(1) Campaign communication-- The term does not include a communication made by e-mail. [ A written or oral communication relating to a campaign for nomination or election to public office or office of a political party or to a campaign on a measure. ]

[(2) Campaign contribution--A contribution to a candidate or political committee that is offered or given with the intent that it be used in connection with a campaign for elective office or on a measure. Whether a contribution is made before, during, or after an election does not affect its status as a campaign contribution.]

[(3) Campaign expenditure--An expenditure made by any person in connection with a campaign for an elective office or on a measure. Whether an expenditure is made before, during, or after an election does not affect its status as a campaign expenditure.]

(2) [ (4) ] Campaign treasurer--Either the individual appointed by a candidate to be the campaign treasurer, or the individual responsible for filing campaign finance reports of a political committee under Texas law or the law of any other state.

[(5) Candidate--A person who knowingly and willingly takes affirmative action for the purpose of gaining nomination or election to public office or for the purpose of satisfying financial obligations incurred by the person in connection with the campaign for nomination or election. Examples of affirmative action include:]

[(A) the filing of a campaign treasurer appointment;]

[(B) the filing of an application for a place on the ballot;]

[(C) the filing of an application for nomination by convention;]

[(D) the filing of a declaration of intent to become an independent candidate or a declaration of write-in candidacy;]

[(E) the making of a public announcement of a definite intent to run for public office in a particular election, regardless of whether the specific office is mentioned in the announcement;]

[(F) before a public announcement of intent, the making of a statement of definite intent to run for public office and the soliciting of support by letter or other mode of communication;]

[(G) the soliciting or accepting of a campaign contribution or the making of a campaign expenditure; or]

[(H) the seeking of the nomination of an executive committee of a political party to fill a vacancy.]

(3) [ (6) ] Contribution--[ A direct or indirect transfer of money, goods, services, or any other thing of value and includes an agreement made or other obligation incurred, whether legally enforceable or not, to make a transfer. The term includes a loan or extension of credit, other than those expressly excluded by this subsection, and a guarantee of a loan or extension of credit, including a loan described by this subsection. The term includes an in-kind contribution. ] The term does not include[ : ]

[(A) a loan made in the due course of business by a corporation that is legally engaged in the business of lending money and that has conducted the business continuously for more than one year before the loan is made;]

[(B) an expenditure required to be reported under the Government Code, Chapter 305; or]

[ (C) ] a transfer for consideration of any thing of value pursuant to a contract that reflects the usual and normal business practice of the vendor.

(4) [ (7) ] Corporation--[ A corporation that is organized under the Texas Business Corporation Act, the Texas Non-Profit Corporation Act, federal law, or law of another state or nation. The term also includes the following associations, whether incorporated or not: banks, trust companies, savings and loan associations or companies, insurance companies, reciprocal or interinsurance exchanges, railroad companies, cemetery companies, government-regulated cooperatives, stock companies, and abstract and title insurance companies. ] The term does not include professional corporations or professional associations.

(5) [ (8) ] Direct campaign expenditure--A campaign expenditure that does not constitute a contribution by the person making the expenditure. A campaign expenditure is not a contribution from the person making the expenditure if:

(A) it is made without the prior consent or approval of the candidate or officeholder on whose behalf the expenditure was made; or

(B) it is made in connection with a measure, but is not a political contribution to a political committee supporting or opposing the measure.

(6) [ (9) ] Election cycle--A single election and any related primary or runoff election.

[(10) Expenditure--A payment of money or any other thing of value and includes an agreement made or other obligation incurred, whether legally enforceable or not, to make a payment.]

[(11) General-purpose committee--A political committee that has among its principal purposes:]

[(A) supporting or opposing:]

[(i) two or more candidates who are unidentified or are seeking offices that are unknown; or]

[(ii) one or more measures that are unidentified; or]

[(B) assisting two or more officeholders who are unidentified.]

(7) [ (12) ] Identified measure--A question or proposal submitted in an election for an expression of the voters' will and includes the circulation and submission of a petition to determine whether a question or proposal is required to be submitted in an election for an expression of the voters' will.

(8) [ (13) ] In-kind contribution--A contribution of goods, services, or any other thing of value, except money, and includes an agreement made or other obligation incurred, whether legally enforceable or not, to make such a contribution. The term does not include a direct campaign expenditure.

[(14) Labor organization--An agency, committee, or any other organization in which employees participate that exists for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work.]

(9) [ (15) ] Non-political expenditure--An expenditure from political contributions that is not an officeholder expenditure or a campaign expenditure.

[(16) Officeholder contribution--A contribution to an officeholder or political committee that is offered or given with the intent that it be used to defray expenses that:]

[(A) the officeholder incurs in performing a duty or engaging in an activity in connection with the office; and]

[(B) are not reimbursable with public money.]

[(17) Officeholder expenditure--An expenditure made by any person to defray expenses that:]

[(A) are incurred by an officeholder in performing a duty or engaging in an activity in connection with the office; and]

[(B) are not reimbursable with public money.]

(10) [ (18) ] Opposed candidate--A candidate who has an opponent whose name is to appear on the ballot. The name of a write-in candidate does not appear on the ballot.

(11) [ (19) ] Out-of-state political committee--A political committee that makes political expenditures outside Texas and in the 12 months immediately preceding the making of a political expenditure by the committee inside Texas (other than an expenditure made in connection with a campaign for a federal office or made for a federal officeholder), makes 80% or more of the committee's total political expenditures in any combination of elections outside this state and federal offices not voted on in this state. Section 20.13 of this title (relating to Out-of-State Committees) explains the practical application of this definition.

(12) [ (20) ] Pledge--A contribution in the form of an unfulfilled promise or unfulfilled agreement, whether enforceable or not, to provide a specified amount of money or specific goods or services. The term does not include a contribution actually made in the form of a check.

(13) [ (21) ] Political advertising : [ -- ]

(A) A communication that supports or opposes a political party, a public officer, a measure, or a candidate for nomination or election to a public office or office of a political party, and:

(i) [ (A) ] is published in a newspaper, magazine, or other periodical in return for consideration;

(ii) [ (B) ] is broadcast by radio or television in return for consideration; [ or ]

(iii) [ (C) ] appears in a pamphlet, circular, flier, billboard, or other sign, bumper sticker, or similar form of written communication ; or [ . ]

(iv) appears on an Internet website.

(B) The term does not include a communication made by e-mail.

(14) [ (22) ] Political committee--Two or more persons that have as a principal purpose accepting political contributions or making political expenditures to support or oppose candidates, officeholders, or measures. The term does not include a group composed exclusively of two or more individual filers or political committees required to file reports under Election Code, Title 15 (concerning Regulating Political Funds and Campaigns), who make reportable expenditures for a joint activity such as a fundraiser or an advertisement.

[(23) Political contribution--A campaign contribution or an officeholder contribution.]

[(24) Political expenditure--A campaign expenditure or an officeholder expenditure.]

(15) [ (25) ] Political subdivision--A county, city, or school district or any other governmental entity that:

(A) embraces a geographic area with a defined boundary;

(B) exists for the purpose of discharging functions of government; and

(C) possesses authority for subordinate self-government through officers selected by it.

(16) [ (26) ] Report--Any document required to be filed by this title, including an appointment of campaign treasurer, any type of report of contributions and expenditures, and any notice.

[(27) Reportable activity--A political contribution, political expenditure, or other activity required to be reported under this title.]

(17) [ (28) ] Specific-purpose committee--A political committee that does not meet the definition of general-purpose committee and that has among its principal purposes:

(A) supporting or opposing one or more:

(i) candidates, all of whom are identified and are seeking offices that are known; or

(ii) measures, all of which are identified;

(B) assisting one or more officeholders, all of whom are identified; or

(C) supporting or opposing only one candidate who is unidentified or who is seeking an office that is unknown.

[(29) Telegram report--A shorthand term for a report filed in accordance with the requirements of §§20.221, 20.333, or 20.435 of this title (relating to Telegram Report by Certain Candidates; Telegram Report by Certain Specific-Purpose Committees; Telegram Reports by Certain General-Purpose Committees). The report may be filed by telegram, telephonic facsimile machine, or by hand.]

(18) [ (30) ] Unidentified measure--A question or proposal that is intended to be submitted in an election for an expression of the voters' will and that is not yet legally required to be submitted in an election, except that the term does not include the circulation or submission of a petition to determine whether a question or proposal is required to be submitted in an election for an expression of the voters' will. The circulation or submission of a petition to determine whether a question or proposal is required to be submitted in an election for an expression of the voters' will is considered to be an identified measure.

This agency hereby certifies that the proposal has been reviewed by legal counsel and found to be within the agency's legal authority to adopt.

Filed with the Office of the Secretary of State on May 22, 2006.

TRD-200602858

Natalia Luna Ashley

General Counsel

Texas Ethics Commission

Earliest possible date of adoption: July 2, 2006

For further information, please call: (512) 463-5800