Advisory Opinion 01-08

     A candidate requested advice on whether the value of a durable asset that is donated to a non-profit organization upon termination of the candidate’s registration with the Campaign Spending Commission ("Commission") must be applied toward the donation to community and charitable organization limit imposed upon candidate committees. In short, when a candidate or candidate committee is seeking to withdraw or cease continuation of their status as a candidate or candidate committee under the campaign finance laws, the value of any durable asset donated to community or charitable organizations, will not be considered in the calculation of applicable donations toward the candidate committee contribution limits

     Sections 11-200 and 11-206, Hawaii Revised Statutes ("HRS"), provide that a candidate or candidate committee shall not make contributions from campaign or surplus funds to community service, educational, youth, recreational, charitable, scientific, or literary organizations in an aggregate amount exceeding the contribution limits imposed upon individuals pursuant to section 11-204(a), HRS. However, when a candidate or candidate committee voluntarily withdraws or ceases to pursue a nomination or election, section 11-214, HRS, allows for all residual funds "to escheat to the Hawaii election fund or be donated to a nonprofit organization." The law does not provide for a limit on donations to community and charitable organizations for residual funds.

     The Commission acknowledges that candidate committees often purchase durable property such as an automobile, computer equipment, a television, refrigerator or other similar goods to be used during the campaign for the candidate. Generally, non-consumable supplies and equipment, defined by the department of accounting and general services to have a purchase value of at least $250 and a useful life of twelve months or more, are to be reported in each subsequent reporting period as an asset of the campaign. All expenditures for the purchase or lease of vehicles, equipment, or supplies must be recorded and reported pursuant to sections 11-212 and 11-213, HRS, and upon the sale or other disposition of campaign asset the campaign committee must report the sale price, or the fair market value, as "other receipt".

     Where campaign assets are disposed in a manner other than a sale, such as a donation to a community or charitable organization, a fair market value should be used to determine the value of the donation and this value must be recorded on the "Acquisition and Disposition of Assets" form. In a situation where the candidate or candidate committee is terminating their candidacy with the Commission, the determined value shall not be applied toward the candidate’s or candidate committee’s aggregate contribution limit as provided in sections 11-200 and 11-206, HRS.

     This Advisory Opinion is provided by the Commission as a means of stating its current interpretation of the Hawaii Election Campaign Contributions and Expenditures laws provided under Hawaii Revised Statutes, section 11-191, et seq. and the administrative rules of the Commission provided in chapter 2-14.1, Hawaii Administrative Rules. The Commission may adopt, revise or revoke this Advisory Opinion upon the enactment of amendments to the Hawaii Revised Statutes or the adoption of administrative rules by the Commission.

Dated: Honolulu, Hawaii, September 18, 2001.

CAMPAIGN SPENDING COMMISSION

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A. Duane Black
Chairperson

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Mona Chock
Commissioner

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Richard Choy
Commissioner