(Approved April 25, 2003) AN ACT

Transcription

1 (H. B. 3644) (No. 115) (Approved April 25, 2003) AN ACT To amend the title of TITLE I; amend the next to last paragraph of Section 1.004; to amend subsection (e) of Section 1.005; to amend the introductory paragraph of Section 1.007; to amend subsection (b), to amend subsection (o) of part A of Section 1.011; to add a Part B and Sections 1.033, 1.034, and to TITLE I; to amend Sections 3.005, 3.010, 3.016, 3.017, 3.019, and 3.020; to amend Section 3.024; to amend Sections 3.025, 3.026, 4.008, 8.004, 8.005, and A; and to add Section A to Act No. 4 of December 20, 1997, as amended, known as the Puerto Rico Electoral Act; to create the Electoral Auditor s Office, define his functions, duties and powers; to empower the President of the Commonwealth Elections Commission to impose administrative fines; to establish a system of shared accountability for the financing of political campaigns; to create the Voluntary Fund for the Financing of Electoral Campaigns and establish its functions, management, conditions and origin of resources; to establish the date for the primaries of political parties as from the year 2005; to modify prohibitions and sanctions; to establish transitory provisions, and other related purposes. STATEMENT OF MOTIVES The vote is the most powerful weapon that a citizen has in a democracy. It is with his vote that he expresses his hopes and promotes his objectives. Our society has an honorable history of protecting the sanctity of the vote so that it has value for the citizen who casts it and so that through the electoral process he can express his hopes and sanction those who have failed him. The former purchase of votes was fought and eradicated from our electoral process. With time, we have seen the development of a new

2 2 mechanism that tends to erode the value of our citizens vote. The figure of the political investor has appeared, a citizen with financial resources, ready to make large contributions to political parties or to their candidates so that when these obtain power, he can claim favors from the government based on the size of his contributions. It is necessary to intervene once more to protect the value of each elector s vote, independently from the financial resources of those who cast it. The vote of the person who lacks money has the same value as the vote of the richest one. Since Puerto Rico, has been a pioneer in government contributions to political campaigns, it now becomes necessary to move on to the financing such campaigns with public funds to ensure that large contributions from a few do not determine the direction of a government to the detriment of the majority. Public money is an investment that citizens make of money that belongs to them to ensure the equal value of their vote. The one who has no money places his hopes on justice. The one who has money places his hopes on the favors he may receive. This measure is an effort in the right direction: it causes government and the citizen s participation in the financing of a number of electoral campaigns and establishes a finance program with the shared participation of government and citizenry. Each dollar of public money is an investment in the equality of each Puerto Rican s vote. We aspire to establish a voluntary shared system of finance in electoral campaigns. The party or candidate who joins this voluntary program binds himself to comply with a limit concerning the expense that can be incurred in the political campaign. Additionally, it is provided that each candidate for governor in the elections of 2004, having joined the voluntary program of shared financing, cannot spend in excess of eleven million (11,000,000)

3 3 dollars; three million (3,000,000) dollars as an initial government contribution and the matching of private funds with public funds up to a maximum of four million (4,000,000) dollars. This measure includes those candidacies in which the largest amounts of funds have been spent. It is for that reason that an order of priorities consistent with the resources of the people of Puerto Rico is established to invest in its democracy. In this way, we begin by covering the candidacy for Governor and the four candidacies for mayor where the most expenses have been made in previous electoral campaigns. It is the Legislature s intention to progressively integrate the candidacies for mayors of other municipalities and those of the Legislature according to the evaluation made by the pilot plan authorized herein and the availability of the Commonwealth of Puerto Rico s resources. Another important aspect of the present legislation is the correction of alleged deficiencies in auditing performed by the Commonwealth Elections Commission. This legislation requires the approval of clear and uniform auditing rules applicable to all candidates equally. The criterion of partisan politics is eliminated as this concept is considered improper in an auditing process. It is also established that due process of law guarantees are assured to audited candidates. Finally, the statute of limitations for electoral crimes is extended to prevent a short term of prescription from helping transgressors of the law to avoid the sanctions imposed by this Act, and more rigorous requirements are hereby set forth for political action committees and for independent groups.

4 4 BE IT ENACTED BY THE LEGISLATURE OF PUERTO RICO: Section 1.- TITLE I of Act No. 4 of December 20, 1977, as amended is hereby amended to read as follows: TITLE I GENERAL PROVISIONS PART A - ELECTORAL BODIES Section Section 2.- The next to last paragraph of Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Commonwealth Elections Commission.- The Legislature shall provide sufficient funds to the Commission each year for its operation. To this effect, the Governor shall submit the Commission's Operating Expense Budget for each fiscal year to the Legislature for its consideration, which shall never be less than the budget in effect for the previous fiscal year, except that the budget for non-election years following the year in which a general election is held may be less than that of the election year. The Commission s budget shall be accounted for preferentially as requested by the President of the body. A provision of the general or special law to freeze the Commission s budget or accounts or to postpone expenses or payments shall not be invoked. Section 3.- Paragraph (e) of Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Commission--Functions, duties, powers.- The Commonwealth Elections Commission shall be responsible for planning, organizing, structuring, directing and supervising the electoral

5 5 body and all electoral procedures that govern any election to be held in Puerto Rico, pursuant to this Act and its regulations, govern any election to be held in Puerto Rico. In the performance of this function, it shall have the following duties, in addition to any other provided in this act: (a) (e) To deal with, investigate and resolve matters or controversies submitted to its consideration by any interested party, except in those matters related to party contributions and expenses, political committees, candidates, independent groups or political action committees, and with the financing of political campaigns, which shall fall under the jurisdiction of the President. When the circumstances so justify it, and as may be provided by resolution, the Commission may designate examiner officials who shall submit their reports and recommendations to the Commission. The duties and procedures of these examiners shall be established by regulations or resolutions by the Commonwealth Elections Commission. (f) Section 4.- The introductory paragraph of Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Jurisdiction, Procedures.- Unless otherwise provided in this Act, the Commission shall have original jurisdiction, either of its own accord or at the request of the interested party, to consider, take cognizance of and resolve any matter or controversy of an electoral nature. (a) Section 5.- Paragraphs (b) and (o) of part A of Section of Act No. 4 of December 20, 1977, as amended, are hereby amended to read as follows:

6 6 Section Powers and duties of the President and the Vice- Presidents.- A --The President. The President shall be the executive officer of the Commission and shall be responsible for the execution and supervision of the electoral procedures within an atmosphere of absolute integrity and impartiality. In discharging this task he shall have the powers, attributes and prerogatives inherent to the office, including, but without being limited to, the following: (a) (b) Selecting, recruiting and appointing the personnel needed to further the purposes of this Act, as well as fixing their corresponding remuneration according to the financial resources of the Commission. The appointments of the heads of divisions of the Commonwealth Commission made by the President shall be confirmed with the affirmative vote of at least two (2) Commissioners. Furthermore, the heads, and the seconds-incommand of the divisions, if any, shall not be supporters of the same party. When the Commission carries out special projects, the personnel to be recruited shall be appointed in equal parts from supporters of the three (3) principal parties that have obtained the greatest number of votes in the preceding general election. Any personnel appointments must be subject to regulations adopted to this effect, and no person who has been convicted of a crime that implies moral turpitude, or an offense of an electoral nature, may be appointed. Likewise, Commission personnel may not appear as candidates for elective public office nor fill any office, post or position within the organization of a political party, nor participate in electoral campaigns or campaign for any candidates, with the exception of the

7 7 employees appointed to carry out functions in the Electoral Commissioners' Offices. The President shall name an Internal Auditor to control the revenue, expenses and payments from the funds for the functioning of the Commission and shall assign the necessary personnel to perform such function. He shall also appoint a Director for the Office of Electronic Information Systems and Processing (OSIPE, Spanish acronym). In the Office of Electronic Information Systems and Processing, a Board of Technicians shall be appointed, consisting of a representative of each Electoral Commissioner of the principal parties, all of the same rank, functions and access to all the procedures in OSIPE, and shall Act as a team before the Director in all the proceedings in that office. When any firm or individual is hired to perform jobs, counseling or to sell equipment, the Director of OSIPE must have the unanimous consent of the Board of Technicians. If there is not such unanimity, the case shall be appealed to the plenary of the Commission. No public servant, employee, internal or external counsel of OSIPE may perform programming changes without the presence or express and unanimous authorization of the Board of Technicians or their respective representatives. Absolutely no one may intervene, access or modify the programming used by OSIPE outside its installations. All the external or internal consultants and aids of the Director of OSIPE, must be appointed or hired in a party neutral way under the same conditions. The above does not apply when the hiring concerns a firm or enterprise with the purpose of installing equipment or developing a special and temporary project that does not extend beyond six (6) months. (c)

8 8 (n) (o) To deal with, research and solve matters or controversies submitted to its consideration by the Electoral Auditor related to party contributions and expenses, political committees, candidates, independent groups or political action groups, and with the financing of political campaigns. The President may designate examining officers to submit reports and recommendations to him. In matters and controversies within his jurisdiction the President shall have the power to impose administrative fines for violations of the provisions of this law that are not typified and specifically penalized as an electoral crime, in accordance with the following limitations: 1. For candidates and aspiring candidates - up to a maximum of one thousand (1000) dollars for the first infraction and up to a maximum of two thousand five hundred dollars (2,500) for subsequent infractions. 2. For political parties and independent groups and committees - up to a maximum of ten thousand (10,000) dollars for the first infraction and up to a maximum of twenty-five thousand (25,000) for subsequent infractions. Prior to the imposition of fines, the President shall serve the parties with an order to show cause for which the administrative fine should not be applied giving them the opportunity to correct any mistake. The Commission shall establish the specific actions subject to a fine as well as the applicable fine to each of these, through regulations. Section 6.- A Part B and Sections 1.033, 1.034, and are added to TITLE I of Act No. 4 of December 20, 1977, as amended, to read as follows:

9 9 PART B.- ELECTORAL AUDITS Section Office of the Electoral Auditor The Office of Electoral Auditor is hereby created adjoined to the Electoral State Commission, with the principal function of controlling the financing of political parties and candidates campaigns. In exercising such function, and in addition to any others established in this Act, the Electoral Auditor s Office shall have the responsibility of examining and auditing the reports and revenue and expense accounting required by this Act to persons, parties, candidates, independent groups and political action committees, as well as the reports required from agencies and the media providing publicity services to said parties, candidates and committees. The Office shall be directed by the Electoral Auditor who shall be appointed by the President of the Commission with the unanimous consent of the Commissioners for a term of six (6) years and until his successor is appointed and takes office, provided that he shall not be appointed for a second term. Except when this Act provides otherwise, the Electoral Auditor s Office shall have operational autonomy to perform its duties. The provisions of Act No. 5 of October 14, 1975, as amended, known as the Public Service Personnel Act, shall also be excluded. The term Office used in this Act means the Electoral Auditor s Office, except when from its use and context a different meaning clearly emerges. Section Electoral Auditor.- The Electoral Auditor shall be of legal age, a resident of Puerto Rico at the time of his appointment, duly qualified as an elector, of sound morals, with acknowledged professional capacity and experience in matters of auditing and accounts examination, and with knowledge or interest in

10 10 matters of an electoral nature. The Electoral Auditor shall serve full-time and shall receive remuneration equal to that of the Electoral Commissioners. The President may dismiss the Electoral Auditor from his position for just cause, filing charges with prior notification and a hearing to guarante due process of law. Section Powers of the Electoral Auditor.- The Electoral Auditor shall be the Executive Officer of the Electoral Auditor s Office and shall be responsible for the functions of said office to be performed with independence and procedural transparency. In the discharge of his duties, and without any limitation, he shall have the following powers, duties and responsibilities: (a) To establish an electoral auditing system that shall be applied in a fair and uniform way to people, candidates, independent candidates, political parties, political action committees and independent groups subject to the provisions of this Act. (b) To issue the regulations of the General Auditing Rules adapted to the dynamics of electoral procedures. These rules shall be submitted for the consideration of the Commission through its formal filing at the Office of the Secretary of said organism. Said regulations shall be adopted according to the procedure established in clause (1) of Section 1.005, after the holding of a public hearing which must be announced in at least two (2) newspapers of general circulation and not less than fifteen (15) days in advance of before the hearing. (c) To prepare and adopt specific auditing rules following generally accepted auditing rules, but adapted to the particular aspects of electoral procedures, which shall be uniformly applied without political partisan bias, and shall be submitted for the Commission s approval.

11 11 (d) Every audit in which a possible violation against the electoral legal system is detected must be accompanied by a duly founded legal opinion in writing. (e) To delegate to officers of his Office any of the powers, duties and responsibilities set forth by this Act, with the exception of personnel recruiting and the approval of regulations. (f) To adopt the official seal of the Office, which shall be stamped on all official documents and of which judicial notice shall be taken. (g) To take testimony and sworn statements. (h) To develop an orderly and easy to use data base, with information about contributions to parties, candidates, independent groups and political action committees. He shall also implement a system to receive submittals of electronic report filings, hold, recover and divulge information about campaign financing and any other reports related to the financing of parties and candidates required by this Act. The Electoral Auditor shall provide to the elected parties, candidates and officers the necessary format for such reports and shall establish a staggered program for their electronic filing. He shall also provide public access to said system through electronic media or through the Internet. The system for electronic filing must be operating on or before July 1, (i) To perform audits concerning contributions and expenses of parties, political committees, candidates, independent groups or political action committees and the financing of political campaigns and deal with and research claims, duly sworn before a notary public, against any candidate, political party, independent group or political action committee related to violations of the campaign contributions and expenses rules. Any claims shall be processed in agreement with the regulations and their

12 12 proceeding, including their publicity, shall be controlled by the established auditing rules. (j) To issue orders summoning witnesses, as well as request the production or reproduction of any papers, books, documents, dossiers or any other pertinent evidence. He/she may resort to the Court of First Instance to request aid to comply with his duties, should he/she deem it necessary. (k) To establish programs for counseling and educating parties, candidates, political action committees and independent groups concerning the obligations, duties and responsibilities that this Act imposes in reference to the financing of political campaigns. Attendance to these counseling and education programs shall be mandatory for every candidate. Said mandatory program shall not exceed four (4) hours. (l) To select, recruit, and appoint the necessary staff to realize the Office s purposes according to the norms and regulations adopted for its activity as well as to establish the corresponding compensation based on a uniform classification and compensation plan. The staff may avail themselves of the benefits of Act No. 447 of May 15, 1951, as amended, known as Public Employees Retirement System of the Government of Puerto Rico. (m) To approve the work plans, rules, and by laws that are necessary to put in effect the provisions of this Act. (n) To prepare and manage the Office budget. To these ends, he shall submit an annual proposal to the Commission which shall be included in the Government Functional Budget of this organism for each fiscal year. The funds assigned to the Electoral Auditor s Office shall be for the exclusive use of the Office and shall be accounted for separately from those assigned for the operations of the Commission.

13 13 (o) To buy, contract, or lease any materials, printed matter, services or equipment or to hire professional and technical services necessary for realizing the purposes of this Act according to the regulations adopted for such purpose and independently from Act No. 164 of July 23, 1974, as amended, known as the General Services Administration Act. Section Auditing Reports and Electoral Auditor s Determinations The audits shall be simultaneously performed for all candidates running for the same position, including those who were not elected. Prior to the publication of the audit reports, the Electoral Auditor shall give the candidates the opportunity to amend, reply and explain in writing matters concerning the preliminary findings contained in the report draft. He shall also allow them the option to meet to discuss said reports informally. Every auditing report shall include the challenge or the explanation provided by the candidate concerning the findings. At draft level, reports shall be kept confidential. Publication of the reports shall be made simultaneously for all the candidates running for the same position. The audit reports shall be made public no less than ninety (90) days before the general elections, except when the candidates challenge sworn claims about alleged violations committed during the campaign period. The Electoral Auditor shall notify all candidates of the date when the audit reports shall be published, giving them a copy of the final report with a minimum of five (5) days before said publication. The Auditor shall notify the audited candidate of any finding indicating that he inadvertently received cash contributions contravening the provisions of the applicable law and regulations, for such contributions to be returned within fifteen (15) calendar days following the Auditor s notice. Should the

14 14 money not be returned, the findings shall be reported together with the indications made in the audit report. The Electoral Auditor s findings shall be submitted to the President, who must consider them within a term not to exceed thirty (30) days from the date of filing at the Office of the Secretary of the Commission. Any party affected by the President s findings may within ten (10) days following notice of the same, resort to the Court of First Instance to file a review writ. In the same way, if the President does not resolve the matters submitted by the Electoral Auditor within the referred term of thirty (30) days, the affected party may resort to the Court of the First Instance for the same to decide on the merits, in agreement with the norms in Section of this Act. The decisions of the Court of the First Instance may be reviewed by the Circuit Court of Appeals within ten (10) days following the date in which the notice was filed. Section 7.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Contributions to parties and candidates No natural person and no independent group or political action committee shall, directly or indirectly, make contributions in or outside of Puerto Rico, to a political party or any of its candidates, or to a combined political party, or to an independent candidate, for any election campaign in behalf of any candidate, political committee or other organization devoted to promote, foster or advocate the election of any candidate of a political party, or for the victory of any political party, in excess of the amounts stipulated herein below:

15 15 (a) To candidates of a political party, direct or central municipal body of any party or independent candidate up to the amount of one thousand (1,000) dollars per year and in no case can the annual amount so contributed or so given exceed five thousand (5,000) dollars. (b) An independent group or committee supporting a political candidate or party up to the amount of five hundred (500) dollars per year. In no case may the total annual contribution of a natural person or of an independent group or political action committee exceed the sum of five thousand (5,000) dollars per year for all the independent committees or candidates. It shall be illegal to accumulate the contributions within the established limits, left unpaid in one specific year, to be paid in subsequent years, or to advance such amounts appertaining to other years, to be paid in one year. Every expense coordinated with any candidate or with any independent group or political action committee shall be considered a contribution subject to the limitations established in this Section. Those candidates and parties who coordinate campaign expenses among themselves shall assume the responsibility of reporting about the same in proportion to the quantity contributed, always within the limitations allowed by this Act. The mere presence or participation by a candidate in an organized activity and completely paid by another candidate or by another political party shall not be considered a coordinated expense. The maximum amount a natural or juridical person may contribute or donate to a candidate in a primary election shall be five hundred (500) dollars.

16 16 Contributions made to combined political parties shall be subject to the limitations provided herein as if dealing with one (1) single political party. Any contribution which exceeds the sum of fifty (50) dollars within the limits established in this Section shall be made by check, money order or legal tender; provided, that the contributor is identified with his name and surname, mailing address and the name of the candidate or party to whom it is directed. The Commission shall establish through the regulations any other necessary requirement for compliance with the purpose of identifying said contributor with the electoral identification number, or the driver s license, or any other legally acceptable identification. All the contributions made by independent groups or committees shall be identified by check, money order, credit or debit card and the names and surnames and mailing addresses of all donors. The Commission shall establish by regulations any other necessary requirement for compliance with the purpose of identifying any contributor among which shall be included the electoral identification number, the driver s license, or any other legally acceptable identification. Section 8.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Anonymous contributions Any contribution in excess of fifty (50) dollars made to a political party or to a candidate, whose donor cannot be identified, is hereby prohibited, except: (a) When the contribution is made in a collective political event. If said contribution exceeds fifty (50) dollars, the same shall be made in accordance with the provisions of Section of this Act. (b) When any political party is exempted from the obligation of identifying the donor, pursuant to the provisions of this subtitle.

17 17 The political party or candidate that receives an anonymous contribution in excess of fifty (50) dollars shall remit the same to the Secretary of the Treasury, which shall be deposited in the Voluntary Fund for the Financing of Electoral Campaigns created through Section of this Act. It shall be illegal for any party or candidate to retain any anonymous contribution in excess of the terms provided in this Act. (c) The total of anonymous contributions that a political party and its candidate for governor who opts for the Voluntary System for Electoral Campaign Financing can not exceed six hundred thousand (600,000) dollars from the total of private contributions collected for deposit to the Voluntary Fund created through Section of this Act. Likewise, the total amount in anonymous contributions that any political party, and its candidate for governor who do not avail themselves of the Voluntary Fund cannot exceed six hundred thousand (600,000) dollars. (d) The total amount in anonymous contributions that any candidate for Mayor in a municipality participating in the pilot project may receive shall not exceed fifteen (15) percent of the total of private amounts that a candidate who opts for the Voluntary Fund may collect, according to the limitations established in Section 3.024(c) of this Act. Any amount in anonymous contributions received by a candidate or party in excess of the limitations established in this Section shall be remitted to the Secretary of the Treasury, who shall deposit same in the Voluntary Fund to pay the government contribution for political campaigns of parties and candidates. Section 9.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows:

18 18 Section Use of the Media.- The Commission must update the impact of the inflationary factor in the media one (1) year before the date when general elections are held. For this purpose, it will perform the corresponding study and will remit it to the Governor and to the Legislative Assembly of the Commonwealth of Puerto Rico and to the Electoral Auditor s Office. Radio and television stations owned by the Commonwealth of Puerto Rico shall not be used by the party in Government for political partisan purposes. However, they shall be under the obligation to cede a portion of time from their programming during the electoral campaign period to inform the electors with respect to the party programs or the candidates involved in the same, if the Commission so requests it. The Commission shall establish through regulations, and in coordination with the radio and television stations of the Commonwealth of Puerto Rico, the form and manner in which they shall provide for the use established herein. Section 10.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Accounting and statements on other income and expenses (a) Every political party and every candidate, excluding the candidates to the Municipal Assemblies, and every person or independent political group, shall keep a complete and detailed accounting of every contribution received in or outside of Puerto Rico, and of every expense they incur which has not been charged to the Electoral Fund, and shall render a report under oath, every three (3) months, listing said contributions, and expenses, the date on which they were received or incurred, the full name and address of the person making the contribution or receiving the payment,

19 19 as well as the purpose for which such an expense was incurred. (b) Any activity paid with contributions from different persons where the central focus is an aspirant, elected officer or party, and independently from whether it is an activity aimed at gathering funds to promote the election or defeat of a candidate or party, pay outstanding debts, offering recognition, paying homage or celebrate anniversaries, the Electoral Auditor s Office must be informed about same in the form and manner established in this Section. (c) When in any collective political act, including mass meetings, marathons, political rallies, gatherings, or other similar activities, any funds are raised, the fund raiser or raisers shall prepare a sworn notary statement after the activity has been held, attesting to: (a) The type of political activity held; (b) an estimate of the number of persons attending it; (c) the total amount of money raised, and (d) that none of the donors contributed any amount in excess of the amounts stipulated in this Act. Said statement must be filed before the Electoral Auditor s Office within (5) days following the date such activity was held. (d) Beginning on the first day of September of the year preceding a general election, the report mentioned in subsection (a) of this Section must be rendered monthly to the Electoral Auditors Office before the fifteenth day of the month following the report. From October 1 of the election year until the last day of said year, the reports shall be rendered every fifteen days, on the 1st and 15th day of each month. The last report, which shall cover the transactions made after January 1 of the year following an election, shall be

20 20 filed ninety (90) days after the same. After July 1, 2004, the Electoral Auditor must audit the final reports within a term of ninety (90) days from the date they were rendered, for the purpose of issuing a summons about the return of contributions in excess. If not done within said term, the Electoral Auditor s Office shall be precluded from determining and requesting such returns. (e) The provisions established in the preceding paragraphs shall be applicable to every election, referendum, plebiscite or any process of an electoral nature, and the statements thereof shall be filed on the dates provided according to the Commonwealth Election Commission s regulations. (f) For the purpose of filing the reports required by this Section, a candidate shall be any person who, at any time prior to his nomination by himself, or through another person, group or entity, has received a contribution to be used in an election, in which the recipient thereof shall appear as a candidate. As an appendix for each one of the reports required by this Section, the political parties and the candidates must include a sworn statement to the effect that if any of the services given or rendered by their publicity agents or agencies was performed in a coordinated manner; that is, through the cooperation, consultation, concert, planning, suggestion or petition of any other political party, candidate, political action committee or independent group or authorized agents of the same. If the services had been rendered in a coordinated form, then the sworn statement must include the name and address of the party, candidate, political action committee or independent group with which the rendering of such services was coordinated.

21 21 (g) The Electoral Auditor shall establish a dynamic program to perform audits to parties, political action committees and candidates at least every two (2) years, unless it is determined that the audits should be done more frequently. In the performance of such audits, the bank accounts of parties, candidates and political action committees shall be examined. The results of such audits shall be made public on or before five (5) days after having been received. Section 11.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Expenses by Persons not Affiliated to Political Parties or Campaign Committees and by Independent Groups or Political Action Committees (a) Any person or independent group or political action committee that receives contributions or incurs in an independent expense in excess of five hundred (500) dollars to campaign in favor or against a party or candidate shall register with the Commission within ten (10) days following the date of its organization as a group, or the date on which the contribution or expense in excess of what is provided herein was incurred. The Commission shall provide through regulations the procedures for the registration of said groups or persons. (b) The registration required in subsection (a) of this Section shall include, at least, the following information: 1.- In the case of natural persons, the name and physical or mailing address and the name of the treasurer or custodian of the books, if any. 2.- In case of independent groups or political action committees, the names and surnames of their directors, or principal officers,

22 22 and of the treasurer, physical address, mailing address and telephone of the independent group or political action committee. 3.- The address or electronic mail address. 4.- A statement about the type of organization, be it a corporation, enterprise or association of any other type of operating organizational structure, expressing if the operation has a continuing nature and the date in which the operations began or the date of incorporation, as the case may be. 5.- The assets of the person or independent group or political action committee at the date of registration, destined to the political campaign, including a narrative itemization of the deposits and financial institutions, the personal or real property, investments, cash or any other disposable assets. (c) Any independent group or political action committee that must register with the Commission must designate a treasurer at the time of being organized as a group or on the date when the contribution was received or when the excessive expense was incurred in the as herein provided. No payment will be made without the treasurer s authorization and this, jointly with the highest placed officer within the group or committee, shall be the people legally responsible for complying with the provisions of this Act. (d) When the position of treasurer becomes vacant before his obligations have been fulfilled, the highest officer of the group or committee shall perform the functions of the treasurer until a successor is appointed. The independent group or political action committee must file an informative statement with the commission about the resignation or removal of said officer, for the same to be effective. The person who resigns or is removed from the duties of treasurer in an independent group or political

23 23 action committee must certify to the truthfulness of the treasury records to the person following in his charge. A successor treasurer shall not be liable for the truthfulness and accuracy of his predecessor s records. Section 12.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows: Section Communications, Agreements, Production Costs and Reports Each political party and each candidate for Governor and each political action committee shall file with the Electoral Auditor s Office and the management of each public communications media it wishes to use, the name or names and the signatures of the persons authorized to contract time and space in said communications media in their name. Before communication media campaigns begin, publicity agencies shall be bound to request from the political parties and their candidates for Governor and from independent groups or political action groups, a certification by the Commonwealth Elections Commission evidencing that they are registered or certified by said organism, as may apply. All agencies rendering advertising services, and all the communications media, rendering services to political parties at the central level, to candidates for Governor, and to persons and independent groups, shall be bound to render monthly reports to the Electoral Auditors Office, beginning with the month of January of each year in which a general election shall be held, stating the cost of the services rendered by them for political advertisements. The agencies and the media referred to in this paragraph must include in said reports the name, mailing address and social security number of any person who pays for the publicity production cost of parties at a central level, candidates for Governor, independent persons and groups. They must also

24 24 report any contribution in the way of assets or services, such as vehicles, research, surveys or others of any other nature, whose purpose is to promote the success or the defeat of a party or candidate. Said reports shall be filed, under oath, no later than the tenth (10th) day of the month following the month covered by the report. As of the first of October of the election year, said reports shall be filed on the 16th and 31st of October, covering the expenses incurred up to the day before the date of the filing thereof. The report corresponding to the last fifteen (15) days of the month of October shall be filed before midnight of the 31st day of said month. The report for the remaining period up to the day before the election shall be filed before midnight of the day before the date the election is held. The reports of the expenses corresponding to election day shall be filed before midnight of the same day it is held. The public communications media shall charge each party or candidate equitably for their services. As an appendix to each of the reports required under this Section, the publicity agents or agencies must include a sworn statement of whether their services have been rendered in a coordinated manner; that is, through the cooperation, consultation, concert, planning, suggestion or request of any other political party, candidate, political action committee or independent group, or agent authorized by these, who is not the persons who contracted their services. If the services were rendered in a coordinated manner, then the sworn statement must include the name and address of the party, candidate, political action committee or independent group with whom the rendering of services was coordinated. Section 13.- Section of Act No. 4 of December 20, 1977, as amended, is hereby amended to read as follows:

25 25 Section Voluntary Fund for the Financing of Electoral Campaigns.- In order to finance the parties political campaigns, their candidates for governor and the independent candidates for governor, a system of shared responsibility is hereby created with citizen participation, through the creation of a Voluntary Fund which shall be supported by private and public resources. Said Fund is an integral compounded program which requires that the parties and candidates opting for this financing system accept it in its totality. The Voluntary Fund resources shall be available the first (1 st ) of July of each year in which general elections are held. As an alternative to private financing of political campaigns, the Voluntary Fund shall be available to political parties, their candidates for governor and the independent candidates for governor and as a pilot project for financing Municipal Campaigns, for candidates of political parties and independent candidates for mayor of San Juan, Carolina, Bayamón and Guaynabo. The parties and the candidates for governor and the candidates for the foregoing mayors offices, who on the date of filing their candidacy for general elections certify expressly that they shall submit to the same through a sworn statement filed in the Office of the Secretary of the Commission, may participate in the benefits of the Voluntary Fund. Independent candidates duly certified by the Commission who compete for the foregoing positions, may also avail themselves of this Fund. Once said certification is filed, the option to apply for the benefits of the Voluntary Fund shall be final and firm and cannot be revoked for that particular general election. If the sworn certification is not received within the term for filing candidacies, the party, its candidate for governor, the parties candidates for mayor included in pilot plan and the independent

26 26 candidates for these positions are precluded from applying for the benefits of this Fund for the general election in question. (a) Creation of the Fund.- A special fund is hereby established in the accounts of the Department of the Treasury, designated as the Voluntary Fund for the Financing of Electoral Campaigns. The management of the Fund and the custody of the money deposited in same falls on the Secretary of Treasury, who shall keep qualifying separate accounts for each party and their candidates who applied for the benefits of the Voluntary Fund. Payments and disbursements shall be channeled through the Department of the Treasury, with prior justification for those purposes and according to the rules applicable to the disbursement of public money in accordance with the provisions of subsection (d) of this Section. (b) Resources for the Fund.- The necessary resources to allow each party and its candidate for governor the use of the amounts authorized herein are hereby apportioned to the Voluntary Fund fro the Financing of Electoral Campaigns to be obtained from any funds available to the State Treasury. Said Fund shall also receive contributions raised by parties, their candidates for governor and the independent candidates for governor for the campaign of the general election in which they have filed the certification applying to avail themselves of the benefits of the Fund; the contributions raised by candidates for Mayor included in the pilot plan who have filed the certification to avail themselves of the benefits of the Fund; any interest generated by the resources of the Fund; the money recovered through civil fines referred to in Section of this Act; anonymous contributions in excess of the limit established in Section 3.010; and the quantities assigned for the general election that are not used by the parties and candidates that applied for this Fund. The President of the Commonwealth Elections

27 27 Commission shall provide notice to the Legislature on or before May 1 of the electoral year, of the number of candidates certified for the general election who have filed a certification applying for the benefits of the Fund. (c) Appropriations and revenue for the Voluntary Fund for the Financing of Electoral Campaigns.- To cover the campaign expenses of the parties and the candidates for governor certified by the Commonwealth Elections Commission, the Secretary of the Treasury shall deposit in the Voluntary Fund the following amounts: 1. A basic appropriation of three million (3,000,000) dollars for each political party and its candidate for governor, and independent candidate. 2. Up to four million (4,000,000) dollars in contributions raised by the political parties and the candidates for governor, and independent candidates as authorized by the provisions of this Act. 3. A progressive appropriation of up to four million (4,000,000) dollars for each political party and its candidate for governor, and independent candidate to match the contributions that they raise. The financing of campaigns for mayor included in the pilot plan is established on the basis of limits for total allowed expenses for each candidate, which shall be the following: San Juan, a million and one half (1,500,000) dollars; Carolina, nine hundred thousand (900,000) dollars; Guaynabo, eight hundred and fifty thousand (850,000) dollars, and Bayamón, seven hundred and fifty thousand (750,000) dollars. The Secretary of the Treasury shall deposit the following amounts in the Voluntary Fund for the candidates for mayor of the referenced municipalities:

28 28 1. A basic appropriation equivalent to twenty-five (25) percent of the limit for total campaign expenses. 2.- The contributions raised by candidates up to an amount equivalent to half of seventy-five (75) percent of the limit for total campaign expenses and a progressive appropriation of up to half of said seventy-five (75) percent to match the contributions that they raise. For the general elections of 2008 and thereafter, the amounts assigned to the Voluntary Fund shall be adjusted in agreement with the impact of inflation upon the communications media, according to the study that the Commission must perform as set forth in Section of this Act. (d) Availability of Funds.- The resources of the Voluntary Fund shall be available to parties and candidates after July 1 of the year in which the general election is held. After that date, the Secretary of the Treasury shall make the corresponding disbursements charged to the same no later than the fifth business day from having submitted the request for funds with the necessary documents for its processing. During the first six (6) months of the year of general elections, every candidate under the Voluntary Fund for the financing of electoral campaigns against whom a campaign is running in paid communications media by a person, party, political action committee or independent group shall have the right to use the same amount of money to defend himself/herself originating from the private funds deposited in his qualifying account. (e) Expenses Charged to the Voluntary Fund.- The Voluntary Fund shall be used exclusively to pay for the campaign expenses of the political party and its candidate for governor and the candidates for mayor for a political party in the municipalities included in the pilot plan and by the independent candidates duly certified by the Commission for said positions

29 29 who have filed the certification to avail themselves of the benefits of the Fund. Under no circumstance may the amounts deposited into said Fund be used to pay debts contracted before July 1 of the year in which the general election is held for which they avail themselves of the financing option provided in this Section. The matching of funds shall be in effect up to December 31 of the electoral year. (f) Campaign Expenses and Prior Debts Still Pending.- The political parties candidates for the municipalities included in the pilot plan who avail themselves of the Voluntary Fund, must certify to the Commission and to the Electoral Auditor s Office the amount of accumulated debt still pending. Said certification shall be made within a term not to exceed fifteen (15) days from the date when the certification to avail themselves of the benefits of the Voluntary Fund has been filed. The parties and candidates may raise funds for the payment of prior debts, even if they have availed themselves of the Voluntary Fund. Before holding any activity to these ends, they must give notice of same to the Electoral Auditor s Office indicating the date, place and type of activity. After said activity is held, the fundraiser must prepare a document with the information required in subsection (c) of Section 3.017, and file same in the form and within the term specified therein. The money raised for payment of prior debts shall be deposited into an account in a financial institution separate from the other accounts of the party or candidates, to be used exclusively for such purposes and shall be accessible to the Auditor at any time. The name of the financial institution and the number of the account must be reported to the Electoral Auditor s Office and the revenue and expenses shall be included in the reports that this Act requires the parties and candidates to file with the