Rules
Proposed
PROPOSED RULES
At its September 2023, meeting, the Texas Ethics Commission voted to propose the following amended and repealed rules: §§ 18.10 (amended) and 18.11 (repealed). The text of the proposed amended and new rules are located below.
§18.10. Adjustments to Reporting Thresholds.
Text of Adopted Rule
§18.11. Reporting Staff Reimbursement.
Text of Adopted Rule
Summary of Proposed Rules, in English
This proposal amends the rules used to determine whether an otherwise timely filed 8-day pre-election report will be considered late by virtue of correction. If a filer makes a correction to an 8-day pre-election report, the law requires the Commission to review the correction to see if the report substantially complied with the law as originally filed. Tex. Gov’t Code § 571.0771(c). If a substantial correction is made to the report, the report is considered filed as of the day of the correction. Since 8-day reports are subject to an accruing penalty of $500 for the first day late and $100 for each additional day after that up to $10,000, a voluntary correction to an 8-day pre-election report can trigger substantial fines. The filer must also affirm that the report was filed in good faith and within 14 business days of learning of the error or omission for the correction not to trigger a late penalty. Id.
The 8-day reports are considered “critical” reports which provide voters important information immediately before an election. The law is designed to prevent a filer from filing an incomplete or inaccurate report only to correct it later while evading any late filing penalty. However, the Commission has an interest in encouraging voluntary corrections to good-faith errors or omissions in reports. Knowing that a correction may trigger a hefty fine could dissuade some filers from correcting their reports. The proposed rule amendment attempts to strike a balance of encouraging corrections for good-faith mistakes while preventing a person from filing an inaccurate or incomplete report before an election.
The Commission currently decides whether a report substantially complied as originally filed by using TEC Rule 18.10. If a corrected 8-day report is determined to be late by virtue of correction, a filer may request that the fine be waived or reduced. TEC Rule 18.10, which is a special set of criteria, is applied to 8-day reports that are late due to correction. Although the rules are somewhat ambiguous, the general rules for late reports, TEC Rule § 18.23 through 18.26, are also applied. The filer is given the more generous outcome.
The proposed amendment raises the monetary threshold of what would constitute a substantial correction. It also moves criteria that would qualify a corrected report or a waiver into the determination of whether the report will be considered late because of the correction. This provides a filer the waiver it would be entitled to under the rules without having to file an affidavit of defense.
Resumen de las Reglas Propuestas, en español:
Esta propuesta enmienda las reglas usadas para determinar si un reporte de pre-elección de ocho días, es entregado a tiempo, o será considerado tarde para su corrección. Si un declarante hace una corrección al reporte de pre-elección de 8 días, la ley requiere que la Comisión revise la corrección para ver si el reporte obedeció a la ley como originalmente se propuso. Código del Gobierno de Texas § 571.0771(c). Si se hace una corrección sustancial al reporte, el reporte se considera como entregado el día en el cual se hizo la corrección. Ya que los reportes de 8 días son sujetos a una sanción incremental de $500 por el primer día en que se entrega tarde y $100 por cada día adicional hasta $10,000, una corrección voluntaria al reporte pre-elección de 8 días puede causar multas sustanciales. El declarante debe afirmar que el reporte se sometió de buena fe y dentro de los 14 días en que se supo del error de la omisión para que la corrección no cause ninguna multa de tardanza. Id.
Los reportes de 8 días se consideran informes "críticos" que brindan a los votantes información importante inmediatamente antes de una elección. La ley está diseñada para evitar que un declarante presente un reporte incompleto o inexacto sólo para corregirlo más tarde y evadir cualquier sanción por presentación tardía. Sin embargo, a la Comisión le interesa fomentar correcciones voluntarias de errores u omisiones de buena fe en los informes. Sabiendo que una corrección puede generar una multa considerable podría disuadir a algunos declarantes de corregir sus reportes. La enmienda propuesta a la regla intenta lograr un equilibrio entre fomentar correcciones por errores de buena fe y al mismo tiempo evitar que una persona presente un reporte inexacto o incompleto antes de una elección.
La Comisión actualmente decide si un reporte obedeció sustancialmente a la ley cuando fue sometido originalmente con el uso de la Regla TEC 18.10. Si un reporte de 8 días se determina tarde por ser corregido, el declarante puede pedir que se exima o reduzca la multa. La regla TEC 18.10, que se caracteriza por ser un criterio especial, se aplica a reportes de 8 días que se sometieron tarde por hacerse una corrección. Aunque las reglas son un poco ambiguas, las reglas generales relacionadas con los reportes sometidos tarde, la Regla TEC § 18.23 al 18.26, también se aplica. El declarante recibe el resultado que más le beneficia.
La enmienda propuesta eleva el umbral monetario de lo que constituiría una corrección sustancial. También traslada los criterios que calificarían un reporte corregido o una exención a la determinación de si el informe se considerará retrasado debido a la corrección. Esto proporciona al declarante la exención a la que tendría derecho según las reglas sin tener que presentar una declaración jurada de defensa.
§18.10. Adjustments to Reporting Thresholds.
Text of Adopted Rule
The proposed new language is indicated by underlined text.
The deleted language is indicated by [strikethrough] text.
Chapter 18. GENERAL RULES CONCERNING REPORTS.
Guidelines for Substantial Compliance for a Corrected/Amended 8-day Pre-election Report.
(a) A corrected/amended 8-day pre-election report substantially complies with the applicable law and will not be assessed a late fine under §18.9 of this title (relating to Corrected/Amended Reports) if:
(1) The original report was filed in good faith and the corrected/amended report was filed not later than the 14th business day after the date the filer learned of the errors or omissions; and
(2) The only corrections/amendments needed were to correct the following types of errors or omissions:
(A) a technical, clerical, or de minimis error, including a typographical error, that is not misleading and does not substantially affect disclosure;
(B) an error in or omission of information that is solely required for the commission’s administrative purposes, including a report type or filer identification number;
(C) an error that is minor in context and that, upon correction/amendment, does not result in changed monetary amounts or activity disclosed, including a descriptive change or a change to the period covered by the report;
(D) one or more errors in disclosing contributions that, in total:
(i) do not exceed $3[2],000; or
(ii) do not exceed the lesser of 10% of the total contributions on the corrected/amended report or $10,000;
(E) one or more errors in disclosing expenditures that, in total:
(i) do not exceed $3[2],000; or
(ii) do not exceed the lesser of 10% of the total expenditures on the corrected/amended report or $10,000;
(F) one or more errors in disclosing loans that, in total:
(i) do not exceed $3[2],000; or
(ii) do not exceed the lesser of 10% of the amount originally disclosed or $10,000; or
(G) an error in the amount of total contributions maintained that:
(i) does not exceed $3,000[250]; or
(ii) does not exceed the lesser of 10% of the amount originally disclosed or $10,000[2,500].
(H) The only correction/amendment by a candidate or officeholder was to add to or delete from the outstanding loans total an amount of loans made from personal funds;
(I) The only correction/amendment by a political committee was to add the name of each candidate supported or opposed by the committee, when each name was originally disclosed on the appropriate schedule for disclosing political expenditures;
(J) The only correction/amendment was to disclose the actual amount of a contribution or expenditure, when:
(i) the amount originally disclosed was an overestimation;
(ii) the difference between the originally disclosed amount and the actual amount did not vary by more than 10%; and
(iii) the original report clearly included an explanation of the estimated amount disclosed and the filer’s intention to file a correction/amendment as soon as the actual amount was known; or
(K) The only correction/amendment was to delete a duplicate entry.
(b) The executive director shall determine whether an 8-day pre-election report as originally filed substantially complies with applicable law by applying the criteria provided in this section.
(c) In this section, “8-day pre-election report” means a report due eight days before an election filed in accordance with the requirements of §20.213(d), 20.325(e), or 20.425(d) of this title (relating to a candidate, a specific-purpose committee, or a general-purpose committee, respectively) and §254.064(c), 254.124(c), or 254.154(c) of the Election Code (relating to a candidate, a specific-purpose committee, or a general-purpose committee, respectively).
§18.11. Reporting Staff Reimbursement.
Text of Adopted Rule
The deleted language is indicated by [strikethrough] text.
Chapter 18. GENERAL RULES CONCERNING REPORTS.
§18.11 Guidelines for Waiver or Reduction of a Late Fine for a Corrected/Amended 8-day Pre-election Report.
(a) A filer who has filed a corrected/amended 8-day pre-election report may request the executive director to waive or reduce a late fine assessed under §18.9 of this title by submitting an affidavit to the executive director. The executive director shall waive a late fine if the report meets the criteria in subsection (b) of this section and shall reduce a late fine if the report meets the criteria in subsection (c) of this section.
(b) A late fine for a correction/amendment to an 8-day pre-election report shall be waived if:
(1) The corrected report was filed not later than the fourth day after the original report due date;
(2) The only correction/amendment by a candidate or officeholder was to add to or delete from the outstanding loans total an amount of loans made from personal funds;
(3) The only correction/amendment by a political committee was to add the name of each candidate supported or opposed by the committee, when each name was originally disclosed on the appropriate schedule for disclosing political expenditures; or
(4) The only correction/amendment was to disclose the actual amount of a contribution or expenditure, when:
(A) the amount originally disclosed was an overestimation;
(B) the difference between the originally disclosed amount and the actual amount did not vary by more than 10%; and
(C) the original report clearly included an explanation of the estimated amount disclosed and the filer’s intention to file a correction/amendment as soon as the actual amount was known.
(c) A late fine for a correction/amendment to an 8-day pre-election report that does not meet the criteria for a waiver under subsection (b) of this section shall be reduced as follows:
(1) If the corrected/amended report was filed more than four days after the original report due date but was filed before the election day, the late fine is reduced to $500;
(2) If the corrected/amended report was filed after the election and the amount of the incorrectly reported or unreported activity was more than 10% of the total amount disclosed on the corrected/amended report but did not exceed the lesser of 25% of the total amount of activity, or $5,000, the late fine is reduced to $1,000; or
(3) If the amount of the incorrectly reported or unreported activity was more than 40% of the total amount disclosed in the corrected/amended report and the corrected/amended report was filed over a year after the election, the late fine is reduced to 10% of the amount at issue.
(d) A late fine that is reduced under this section will revert to the full amount originally assessed if the reduced fine is not paid on or before the 30th calendar day after the date of the notice informing the filer of the reduction.
(e) A filer may appeal a determination made under this section by submitting a request in writing to the commission.
(1) The request for appeal should state the filer’s reasons for requesting an appeal, provide any additional information needed to support the request, and state whether the filer would like the opportunity to appear before the commission and offer testimony regarding the appeal.
(2) After hearing a request for appeal, the commission may affirm the determination made under this section or make a new determination based on facts presented in the appeal.
(f) This section does not apply to a civil penalty assessed through the sworn complaint process or facial compliance review process. ]