RELATING TO ELECTIONS.

HB769

HOUSE OF REPRESENTATIVES

H.B. NO.

769

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

relating
to elections
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION 1.
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The legislature finds that the current
campaign finance system is perceived to favor wealthy donors who may unduly
influence candidates and elected officials through campaign donations.
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Campaign programs that are publicly funded
are intended to improve the election process by giving candidates the option to
campaign without the use of private funds and allowing elected officials to
make decisions without any undue influence by other entities.

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The
legislature further finds that a democracy voucher program is a method of
public financing that provides individuals with a certain number of vouchers
that have monetary value, funded by taxpayer dollars, and can be pledged to
eligible candidates.
�
A democracy voucher
program was approved for use in Seattle, Washington through a 2015 citywide
referendum, and since the program's approval, millions of dollars in public
funding have been used for local elections, with Seattle voters allocating
nearly 95,000 vouchers, worth almost $2,400,000, to fund local city council
elections, supporting over thirty different campaigns.
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The establishment of a similar democracy
voucher program in the State will help to bolster public confidence in the
State's election process and encourage new candidates and more elected
officials to campaign without the influence of private donations.

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Accordingly,
the purpose of this Act is to establish a voluntary democracy dollars program
to provide vouchers to certain residents of the State that can be used to make
contributions to qualified candidates.

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SECTION 2.
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Chapter 11, Hawaii Revised Statutes, is
amended by adding a new subpart to part XIII to be appropriately designated and
to read as follows:

"
.

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Democracy
Dollars Program

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�11-A
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Purpose.
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The purpose of the voluntary democracy dollars program is to improve the
electoral process for elected offices of Hawaii by:

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(1)
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Ensuring that access to wealth and networks of
wealthy contributors is not a prerequisite for candidates to run competitive
campaigns;

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(2)
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Reducing elected officials' reliance on large
donations from wealthy contributors and special interests, which will reduce opportunities
for corruption and the appearance of corruption in government;

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(3)
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Enlarging public discussion of important
issues in an election;

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(4)
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Freeing candidates from the rigors of
fundraising;

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(5)
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Restoring public confidence in the electoral
and legislative processes; and

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(6)
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Increasing meaningful citizen participation,
which should not be limited to people and entities with significant wealth that
may make large campaign contributions.

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�11-B
Definitions.
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As used in this
subpart:

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"Democracy
dollars fund" or "fund" means the subaccount created under
section 11-421(b)(3) for the purpose of funding the democracy dollars program.

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"Eligible
resident" means an individual who:

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(1)
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Is at least eighteen years old on the date of
the election for which vouchers are distributed;

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(2)
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Currently resides in the State and has resided
in the State for more than thirty days;

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(3)
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Is not prohibited from making a contribution
under title 52 United States Code section 30121;

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"Eligible
office" means the following offices:

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(1)
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Governor;

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(2)
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Lieutenant governor;

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(3)
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State senator;

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(4)
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State representative; and

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(5)
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Office of Hawaiian affairs trustee.

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"Program"
means the democracy dollars program the commission administers under section
11-C.

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"Qualified
candidate" means an individual who is certified by the commission to
receive voucher funds under section 11-H.

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"Qualifying
contribution" means a monetary contribution, excluding a loan, in an
amount greater than or equal to $10 and less than the contribution limit
specified under section 11‑H(d).

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�11-C
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Democracy dollars program; established; administration.
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(a) There is established a democracy
dollars program to be administered by the commission to provide vouchers to
eligible residents for the purpose of making contributions to qualified
candidates, beginning with the 2028 elections.

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(b)
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Under the program, the commission shall:

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(1)
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Develop and adopt forms necessary to
administer the program;

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(2)
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Design a voucher that includes the following
elements:

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(A)
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The election for which the commission issues
the voucher;

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(B)
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A serial number and bar code;

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(C)
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The amount of voucher funds the voucher
represents;

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(D)
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The full name of the eligible resident who may
assign the voucher;

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(E)
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A place to write the name of the qualified
candidate to whom the eligible resident assigns the voucher;

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(F)
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A statement informing the eligible resident of
the following:

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(i)
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The last date by which the eligible resident
may assign and deliver the voucher;

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(ii)
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The eligible resident may not revoke an
assignment of the voucher;

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(iii)
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The eligible resident may not transfer the
voucher;

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(iv)
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The voucher has no monetary value; and

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(v)
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The eligible resident may assign the voucher
only as provided under section 11-E;

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(G)
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A statement that affirms that the eligible
resident assigns the voucher voluntarily, free from duress, and not in exchange
for consideration;

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(H)
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A signature line; and

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(I)
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Additional information as the commission
determines is necessary;

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(3)
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Provide educational materials and trainings to
candidates and the public, including the following:

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(A)
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Developing
and conducting in-person training for candidates;

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(B)
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Publishing
guides and manuals for the public, candidates, public officials, political
parties, and committees;

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(C)
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Publishing
a timeline of important dates for the program;

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(D)
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Conducting
education and outreach for the general public;

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(E)
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Providing
all program materials in hard copy form and on the commission's public-facing
website;

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(F)
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Providing
all program materials in the following languages:

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(i)
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English;

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(ii)
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Olelo Hawaii; and

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(iii)
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Additional languages as required by law or
determined by the commission;

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(4)
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Administering the democracy dollars fund,
including:

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(A)
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Determining whether the fund has sufficient
voucher funds to fund all qualified candidates; provided that if the commission
determines the fund has insufficient funds to fund all qualified candidates,
the commission shall:

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(i)
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Notify all qualified candidates that the fund
has insufficient funds;

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(ii)
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Establish a final date by which an eligible
resident may assign a voucher; and

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(iii)
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Authorize the disbursement of remaining
voucher funds to each qualified candidate in proportion to the number of
vouchers assigned to the qualified candidate;

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(B)
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Conducting an independent audit of the fund
following each general election in an even-numbered year and developing
projections for the fund for no fewer than three election periods;

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(C)
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Depositing moneys the commission receives as
fines for violations of this subpart into the fund; and

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(D)
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Depositing moneys the commission receives
under sections 11-H and 11-J into the fund;

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(5)
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Conducting a review of the program following
each general election in an even-numbered year and submitting a report to the
legislature no later than September 1 of the year following the year in which
the State holds a general election; provided that the report shall include the
following information:

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(A)
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A summary of the following for the election
period:

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(i)
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The number of candidates and the number of
qualified candidates running for eligible office;

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(ii)
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The number of vouchers distributed by the
commission;

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(iii)
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The number of unused vouchers and the number
of vouchers paid by the commission;

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(iv)
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The amount of money in the fund before and
after the two-year election period;

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(v)
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A financial projection of the fund for the
subsequent three even-year general elections;

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(vi)
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The number and nature of public education and
outreach events conducted; and

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(vii)
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The number of individuals who participated in
the commission's education and outreach events;

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(B)
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Recommendations for legislative changes to
improve the program, including any recommendations for adjustments to the
following:

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(i)
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The number of qualifying contributions
required under section 11-H(b);

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(ii)
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The amount of voucher funds a qualified
candidate may receive under section 11-F(b);

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(iii)
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The number of vouchers the commission provides
an eligible resident under section 11-D(a); and

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(iv)
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The amount of voucher funds that a voucher
provides to a qualified candidate upon assignment and redemption;

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(C)
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An independent financial audit of the program;
and

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(D)
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An independent operational audit of the
program;

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(5)
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Creating and maintaining a public-facing
digital platform that:

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(A)
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Provides a mechanism by which an eligible
resident may assign any of that resident's vouchers to a qualified candidate;

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(B)
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Displays publicly the following information
for each voucher an eligible resident assigns:

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(i)
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The name of the eligible resident assigning
the voucher;

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(ii)
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The date on which the eligible resident
assigned the voucher;

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(iii)
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The qualified candidate to whom the eligible
resident assigned the voucher; and

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(iv)
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The serial number of the voucher;

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(7)
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Conducting proceedings as provided under
subpart I to determine whether a person violates this subpart; provided that the
commission shall assess administrative fines and make criminal referrals as
provided under subpart I and this subpart for violations of this subpart; and

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(8)
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Adopting rules pursuant to chapter 91
necessary to administer the program.

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�11-D
Democracy dollars vouchers; distribution.
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(a)
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Except as provided in
subsection (b), the commission shall mail four vouchers to each eligible
resident who is registered to vote on the first day of the fourth month prior
to the month in which a primary election occurs.
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The commission shall mail the vouchers to the
address associated with the eligible resident's registration.

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(b)
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The commission shall not mail vouchers to an
eligible resident if the eligible resident does the following:

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(1)
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Indicates on a form developed by the
commission that the eligible resident wants to receive the vouchers by email;
and

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(2)
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Provides the commission with a valid email
address.

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(c)
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An eligible resident who is not registered to
vote on the first day of the fourth month prior to the month in which a primary
election occurs may request vouchers from the commission.
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The commission shall provide the eligible
resident the same number of vouchers as provided under subsection (a) after the
commission verifies the person is an eligible resident.
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The commission shall establish procedures for
verifying that an individual is an eligible resident.

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(d)
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An eligible resident may apply to the
commission to replace a voucher if the eligible resident provides a statement
on a form developed by the commission that the voucher is lost or stolen.
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The commission shall develop a procedure to
determine whether to issue the eligible resident a replacement voucher.
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The commission shall cancel any voucher the
commission determines is lost or stolen.

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�11-E
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Assignment of vouchers.
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(a)
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An eligible resident may assign a voucher by:

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(1)
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Mailing the voucher to the commission;
provided that a voucher shall be assigned if the voucher is postmarked no later
than thirty days after the day of the general election;

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(2)
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Delivering the voucher to a candidate or a
representative of the candidate that is registered with the commission for the
purpose of receiving a voucher.
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For the
purposes of this paragraph, the following individuals may be registered as a
representative of the candidate:

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(A)
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An unpaid volunteer for the candidate's
campaign; or

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(B)
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A member of the candidate's campaign staff who
is regularly employed by the campaign;

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(3)
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Delivering the voucher to the commission; or

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(4)
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Assigning the voucher on a secure digital
platform created by the commission for the purpose of assigning a voucher.

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(b)
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If an eligible resident assigns a voucher to
a qualified candidate under subsection (a)(1), (2), and (3), the eligible
resident shall:

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(1)
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Write the name of a qualified candidate on the
voucher; and

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(2)
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Sign and date the voucher.

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(c)
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An eligible resident shall not:

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(1)
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Change the assignment of a voucher after the
eligible resident assigns the voucher;

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(2)
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Assign a voucher by proxy, power of attorney,
or agent;

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(3)
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Assign a voucher in a manner other than as
provided under subsection (b); or

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(4)
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Assign a voucher later than thirty
�
days after the day of the general election.

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�11-F
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Voucher funds; disbursement.
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(a)
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The commission shall direct the comptroller to disburse voucher funds
pursuant to this section to a qualified candidate if the commission verifies
the following:

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(1)
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The candidate to whom the voucher is assigned
is a qualified candidate at the time the commission authorizes the disbursement
of the voucher funds;

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(2)
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The voucher is properly signed and assigned by
an eligible resident; and

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(3)
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The candidate to whom the voucher is assigned
has not exceeded the voucher funds limits specified under this section at the
time the commission authorizes the disbursement of the voucher funds.

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(b)
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Subject to subsections (c) and (e), the
commission shall not authorize the disbursement of more than the following
amounts to a qualified candidate, based on the qualified candidate's eligible
office:

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(1)
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Governor: $1,675,000 for the primary election;
$2,500,000 for the primary and general elections combined;

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(2)
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Lieutenant governor: $804,000 for the primary
election; $1,200,000 for the primary and general elections combined;

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(3)
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State senator: $67,000 for the primary
election; $100,000 for the primary and general elections combined;

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(4)
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State representative: $33,500 for the primary
election; $50,000 for the primary and general elections combined; and

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(5)
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Office of Hawaiian affairs: $26,800 for the
primary election; $40,000 for the primary and general elections combined.

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(c)
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To be eligible to receive the maximum amounts
under subsection (b), a qualified candidate shall be opposed by another
candidate who either is a qualified candidate or has received contributions or
made expenditures that, in the aggregate, exceed $10,000 during the current
election period.
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For qualified
candidates who are not opposed as described in this subsection, the commission
shall not authorize the disbursement of more than the following amounts, based
on the qualified candidate's eligible office:

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(1)
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Governor: $50,000 for the primary election;
$50,000 for the general election;

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(2)
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Lieutenant governor: $25,000 for the primary
election; $25,000 for the general election;

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(3)
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State senator: $12,500 for the primary
election; $12,500 for the general election;

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(4)
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State representative: $10,000 for the primary
election; $10,000 for the general election; and

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(5)
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Office of Hawaiian affairs: $10,000 for the
primary election; $10,000 for the general election.

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(d)
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A qualified candidate who was opposed in the
election period as described in subsection (c) but is no longer opposed shall
not be required to return voucher funds the candidate received in excess of the
amounts specified in subsection (c) solely because the candidate is no longer
opposed.
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The qualified candidate shall
not be eligible for any additional voucher funds for the election for which the
candidate is not opposed; provided that the candidate may receive voucher funds
to pay for expenditures made while the candidate was opposed if the candidate's
committee does not have sufficient funds to pay for the expenditures.

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(e)
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The commission shall adjust the amounts
specified under subsections (b) and (c) for any change in the consumer price
index for all urban consumers, as published by the United States Department of
Labor's Bureau of Labor Statistics, no later than six months prior to the
primary election for each eligible office.

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(f)
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The commission shall determine and publish in
its timeline under section 11-C(b)(4)(C) all dates on which the commission
authorizes the disbursement of voucher funds, subject to the following
requirements:

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(1)
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Except as provided in paragraph (2), the
commission shall authorize the disbursement of voucher funds to qualified
candidates no less frequently than twice per month; and

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(2)
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Thirty days prior to a primary or general
election, the commission shall authorize the disbursement of voucher funds to
qualified candidates no less than once per week.

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(g)
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The comptroller shall disburse all voucher
funds as directed by the commission within three business days.

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�11-G
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Use of voucher funds.
Notwithstanding
subpart G, voucher funds are subject to the following restrictions:

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(1)
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A qualified candidate may use voucher funds
only for the qualified candidate's direct campaign costs; and

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(2)
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A qualified candidate may not use voucher
funds to pay any of the following:

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(A)
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A business in which the candidate or the
candidate's immediate family member has a ten per cent or greater ownership
interest;

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(B)
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A penalty or fine;

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(C)
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An amount in excess of fair market value for
any good or service received;

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(D)
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The legal defense of an alleged violation of
this part;

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(E)
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A payment to any person to collect vouchers on
behalf of a candidate, except for compensation paid to a regularly employed
member of the candidate's campaign staff; and

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(F)
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Any payment for personal expenses, as defined
by commission rules;

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(7)
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Any payment for the purposes described in
section 11‑381(a)(2) through (8) or section 11-381(b); and

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(8)
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Any additional use as determined by the
commission.

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�11-H
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Candidate certification.
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(a)
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A candidate may apply to the commission for certification as a qualified
candidate if the candidate satisfies the following conditions:

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(1)
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The candidate is eligible to run for an
eligible office;

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(2)
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The candidate has established a candidate
committee;

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(3)
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The candidate certifies to the commission that
the candidate's candidate committee has filed all reports required by this part
and that the reports are complete and accurate, and the candidate agrees to
file all future reports required by this part;

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(4)
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The candidate has complied with the
requirements of this part;

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(5)
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The candidate agrees to comply with the
following requirements for the current election period:

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(A)
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Participate in no fewer than two nonpartisan
debates prior to the primary election and no fewer than two nonpartisan debates
prior to the general election; provided that the commission may modify or waive
this requirement for qualified candidates who are unopposed;

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(B)
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Solicit or accept contributions only from
individuals and as specified in subsection (d); and

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(C)
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Spend voucher funds only as permitted under
section 11-G;

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(6)
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Spend no more than $5,000 in personal funds
for the candidate's direct campaign costs during the election period; and

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(7)
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The candidate has complied with paragraphs (1)
to (6) for the entirety of the election period prior to submitting the
application for certification as a qualified candidate.

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(b)
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The commission shall certify a candidate as a
qualified candidate if the candidate applies as required under subsection (a)
and has received no fewer than the number of qualifying contributions required
for the eligible office, as follows:

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(1)
�
Governor: $6,250;

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(2)
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Lieutenant governor: $3,000;

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(3)
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State senator: $250;

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(4)
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State representative: $125; and

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(5)
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Office of Hawaiian affairs: $100.

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(c)
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A person may not apply for certification
under subsection (a) after the last day on which the person may submit the
person's nomination papers under section 12-6.

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(d)
�
A qualified candidate may not solicit or
accept aggregate contributions from an individual in an election period that
exceed an amount equal to the maximum amount for the eligible office, as
follows:

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(1)
�
Governor: $3,000;

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(2)
�
Lieutenant governor: $3,000;

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(3)
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State senator: $2,000;

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(4)
�
State representative: $2,000; and

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(5)
�
Office of Hawaiian affairs: $3,000.

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(e)
�
A qualified candidate may solicit or accept a
voucher from an eligible resident who has made aggregate contributions to the
qualified candidate that are less than or equal to the amounts under subsection
(d).

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(f)
�
The commission shall revoke a qualified
candidate's certification if the qualified candidate:

����
(1)
�
Withdraws from the election;

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(2)
�
Fails to advance to the general election;

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(3)
�
Materially violates the requirements for
certification as a qualified candidate under subsection (a); or

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(4)
�
Materially violates the requirements of this
subpart or this part as determined by the commission in a proceeding under
subpart I.

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(g)
�
The commission shall provide a written
determination to a qualified candidate whose certification is revoked under subsection
(f) that includes:

����
(1)
�
The specific reason that is the basis for
revoking the certification; and

����
(2)
�
The specific facts found by the commission
that form the basis for revoking the certification.

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(h)
�
A person whose certification is revoked shall
be entitled to judicial review of the commission's written determination as
provided under section 91-14.

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(i)
�
A qualified candidate shall return to the
commission for deposit into the fund all remaining voucher funds the candidate
received, after accounting for campaign debts and expenditures, no later six
months after any of the following occur:

����
(1)
�
The commission revokes the qualified
candidate�s certification under subsection (f);

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(2)
�
The qualified candidate dies; or

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(3)
�
The qualified candidate wins the general
election.

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�11-I
�
Democracy dollars program fund; deposit of
moneys.
The following moneys shall be deposited into the democracy dollars
fund:

����
(1)
�
Appropriations made by the legislature for the
purposes of this subpart;

����
(2)
�
Voucher funds returned by a qualifying
candidate under sections 11-H and 11-J;

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(3)
�
Fines levied by the commission for violations
of this subpart; and

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(4)
�
Voluntary donations made for the purposes of
this subpart.

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�11-J
Program violations.
�
In addition to any
other penalties as provided for under this part, the commission may require a
qualified candidate to return to the commission for deposit in the democracy
dollars fund an amount equal to all voucher funds received by the candidate if
the candidate's certification is revoked under section 11-H(f)(3) or (4).

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(b)
�
A person who knowingly and willfully violates
a requirements of this subpart shall be subject to an administrative fine not
to exceed the greater of $10,000 or the amount of the violation.

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(c)
�
A person who knowingly and willfully makes a
false statement or omits a material fact to the commission shall be subject to
an administrative fine not to exceed the greater of $10,000 or the amount of
the violation.

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(d)
�
A person who knowingly and willfully does or
attempts to do any of the following shall be guilty of a misdemeanor and shall
be subject to an administrative fine of no more than $1,000:

����
(1)
�
Purchases, sells, or transfers a voucher for
consideration;

����
(2)
�
Obtains or controls a voucher with intent to
deprive the eligible resident to whom the voucher was issued of the use of the
voucher;

����
(3)
�
Transfers a voucher obtained or controlled as
provided under paragraph (2);

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(4)
�
Alters or assigns a voucher that was
distributed to someone other than that person; or

����
(5)
�
Creates and distributes a voucher with the
intent that a person perceives the voucher as authentic."

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SECTION
3
.
�
Section 11-421, Hawaii Revised Statutes, is
amended by amending subsection (b) to read as follows:

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"(b)
�

The fund shall consist of:

����
(1)
�
All moneys
collected from persons who have designated a portion of their income tax
liability to the fund as provided in section 235-102.5(a);

����
(2)
�
Any general fund
appropriations; [
and
]

����
(3)
�
All moneys designated for deposit in the
subaccount for the democracy dollars program pursuant to section 11-I; and

���
[
(3)
]

(4)
�
Other moneys collected pursuant to this part.

����
(c)
�

Moneys in the fund shall be paid to candidates by the comptroller as
prescribed in [
section
]
sections
11-431
and 11-F
and may
be used for the commission's operating expenses, including staff salaries and
fringe benefits."

����
SECTION 4.
�
If any provision of this Act, or the
application thereof to any person or circumstance, is held invalid, the
invalidity does not affect other provisions or applications of the Act that can
be given effect without the invalid provision or application, and to this end
the provisions of this Act are severable.

����
SECTION 5.
�
In codifying the new sections added by
section 2 of this Act, the revisor of statutes shall substitute appropriate
section numbers for the letters used in designating the new sections in this
Act.

����
SECTION
6.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.

����
SECTION 7.
�
This Act shall take effect on July 1, 2025.

INTRODUCED BY:

_____________________________

Report Title:

Elections;
Campaign Spending Commission; Democracy Dollars Program; Establishment

Description:

Establishes
a Democracy Dollars Program to be administered by the Campaign Spending Commission
to provide vouchers to eligible residents for the purpose of making
contributions to certain candidates, beginning with the 2028 elections.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.