For the fourth year in a row, states across the country performed best in the Campaign Disclosure Law category, with only six states receiving F grades. Four states made improvements to their campaign disclosure laws since the 2005 study, with Oregon and Virginia moving into the A range, and Tennessee and Vermont moving up into the C range from a D- and an F, respectively. Six states received law grades in the A range, and there were 16 grades in the B range in this category. Four Ds and 18 Cs account for the remaining Disclosure Law grades.

• States with the strongest disclosure laws, in rank order from one to ten, are: California; Oregon; Washington; Virginia; Colorado and Hawaii (tied for 5th); Georgia and New Jersey (tied for 7th); Montana; Missouri, Kentucky and Minnesota (tied for 10th).

• States with the weakest disclosure laws, in rank order from 41 to 50, are: Delaware; Kansas; New Mexico; Maryland; Utah; Nevada; Wyoming; Alabama; South Dakota; and North Dakota.

Significant 2007 findings:

• 31 states require a contributor’s occupation and employer to be disclosed;
• 5 states require only a contributor’s occupation to be disclosed;
• 2 states require only a contributor’s employer to be disclosed;
• 12 states do not require disclosure of either occupation or employer;
• 48 states require descriptions of expenditures to be disclosed;
• 21 states require expenditures made by subvendors to be reported;
• 42 states require independent expenditures to be reported;
• 26 states require timely reporting of last-minute independent expenditures;
• 36 states require timely reporting of last-minute contributions;
• 30 states conduct mandatory reviews of disclosure reports;
• 12 states require field audits of disclosure reports; and
• 9 states require both desk reviews and field audits of campaign filings.

Significant changes since 2005:

• 2 states increased the number of pre-election reports that must be filed by candidates (Oregon, Tennessee);
• 2 states added an additional non-election year campaign finance disclosure filing (Oregon, Tennessee);
• 1 state added contributor occupation and employer reporting (Tennessee);
• 1 state added timely reporting of last-minute contributions (Vermont);
• 1 state added subvendor reporting requirements (Tennessee);
• 1 state added independent expenditure reporting requirements (Vermont); and
• 2 states added timely reporting of last-minute independent expenditures (Vermont and Virginia).

Four states earned higher grades in the Disclosure Law category following improvements made to their campaign disclosure laws as of December 31, 2006 (the cutoff period for disclosure law changes to be reflected in Grading State Disclosure 2007). Oregon and Tennessee improved both in pre-election reporting and non-election year reporting, while Tennessee also added subvendor reporting requirements. Vermont added independent expenditure reporting and improved its reporting of last-minute contributions, while Virginia strengthened its already strong disclosure law by requiring more thorough independent expenditure reporting. Additionally, a number of states’ grades in this category were revised after Project researchers re-evaluated disclosure law findings previously reported.

Many states that strengthen their campaign disclosure laws do so through the appointment of a task force or panel to study the issues that are clouding the public’s ability to access campaign finance information. Tennessee’s Citizen Advisory Group on Ethics and Oregon’s Campaign Finance Disclosure Panel are just two examples of state initiatives that led to successful changes in campaign disclosure laws. Task forces can add weight to recommended reforms and provide greater momentum for passage, particularly with the appointment of a diverse, bi-partisan panel that includes both citizens and policymakers.

Contributor Information

As in years past, Grading State Disclosure 2007 found that every state requires campaign contributors to be named at some contribution threshold, often with additional details disclosed for larger contributions. South Dakota remains the only state that does not require the date of contributions to be disclosed, but is among the 33 states that require a contributor’s employer to be disclosed. Thirty-six states require the disclosure of a contributor’s occupation, while 31 states require both occupation and employer information to be listed on disclosure reports. Twelve states require neither occupation nor employer information to be disclosed.

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The final detail examined in this study regarding contributor information is whether or not a state requires the cumulative contributions made by a donor over the course of a year or election cycle to be reported. Cumulative contribution data makes it easier for the public to identify the scope of a donor’s contributions to a specific candidate. Thirty-six states require cumulative contributions to be reported; 14 states do not.

In-Kind Contributions and Loans

All states require in-kind contributions to be reported, and 48 states require some amount of loan details to be disclosed. Only 15 states require the interest rate of a loan to a candidate to be disclosed, and 16 require the repayment schedule to be reported. In 35 states, the loan’s guarantor must be included in the candidate’s campaign disclosure reports, rather than simply naming the financial institution making the loan.

Expenditures

Forty-nine states mandate that candidates report their campaign expenses. North Dakota remains the only state that does not require disclosure of campaign expenses. Oklahoma and South Dakota require the amount of an expenditure to be disclosed, but not the name or identity of the recipient. Mississippi does not require the purpose for a campaign expense to be reported. Forty-seven states require the date of campaign expenses to be disclosed, and 42 states require candidates to report their campaign debts and obligations. Only 21 states require the disclosure of subvendor payments, such as the itemization of expenses made by campaign consultants or a detailed accounting of credit card expenses.

Number of Reports Filed

States vary widely in the frequency of disclosure reports required to be filed. In election years, twelve states require one pre-election report, 21 states require two such reports, and 17 require three or more reports before an election. In non-election years, 23 states require one report, while 27 states require two or more. Disclosure of late contributions (made between the close of the final pre-election reporting period and Election Day) is required in 36 states. In the 14 states without such last-minute reporting, many contributions are hidden from public review until after the election has taken place.

Independent Expenditures

In recent years, increased attention has been paid to expenditures made by committees that operate independently from candidates and spend tremendous amounts of money to affect election outcomes. Individuals, corporations, unions, and others seeking to influence the outcome of elections can do so through independent expenditures, thus evading state or federal contribution limits. As the prominence of independent expenditures has grown, states have taken steps to ensure that the public knows who is behind this unlimited campaign spending.

Forty-two states now require independent expenditure reporting and 36 of those states require independent expenditure reports to specify which candidate is the subject of the expense. Twenty-six of these states also require that last-minute independent expenditures be reported before the election. As of December 31, 2006, eight states -- Alabama, Indiana, Maryland, New Mexico, North Dakota, South Dakota, Tennessee and Wyoming -- did not require independent expenditure reporting (South Dakota enacted this requirement in 2007).

Auditing and Enforcement

As important as campaign disclosures are, it is equally important to ensure that disclosure reports are accurately filed in a timely fashion. All 50 states have some form of penalty (civil or criminal) triggered by a violation of campaign disclosure requirements. However, the mechanisms for identifying those violations vary from state to state. Ideally, all states would conduct both mandatory reviews as well as field audits of campaign finance records. Presently, 30 states conduct desk reviews and twelve states conduct field audits, with just nine states requiring both (California, Florida, Idaho, Kentucky, Louisiana, Minnesota, Nebraska, Oregon and Tennessee). Seventeen states have no provisions for auditing campaign finances.