A276

An Act concerning contributions by certain individuals and entities doing business with the State and supplementing Chapter 34 of Title 52 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. The Legislature finds and declares:

a. All individuals, businesses, associations, and other persons have a right to participate fully in the political process of New Jersey, including making and soliciting contributions to candidates, political parties and holders of public office.

b. When a person or business interest makes or solicits major contributions to obtain a contract awarded by a government agency, this constitutes a violation of the public's trust in government and raises legitimate public concerns about whether the contract has been awarded on the basis of merit.

c. The growing infusion of funds donated by business entities into the political process at all levels of government has generated widespread cynicism among the public that special interest groups are "buying" favors from elected officeholders.

d. For the purposes of protecting the integrity of government contractual decisions and of improving the public's confidence in government, it will be the policy of this State to prohibit awarding government contracts to business entities which are also major contributors to candidates, political parties and the holders of public office.

2. a. Any other provision of law to the contrary notwithstanding, the State or any of its purchasing agents or agencies or those of its independent authorities, as the case may be, shall not enter into an agreement or otherwise contract to procure services from any professional business or entity, where the value of the transaction exceeds $17,500, if that entity has solicited or made any contribution of money, or pledge of contribution, including in-kind contributions, to a campaign committee of any candidate or holder of the public office having ultimate responsibility for the award of the contract, or to any State, county or municipal party committee or legislative leadership committee, in excess of the thresholds specified in subsection e. of this section within one calendar year immediately proceeding commencement of negotiations for the contract or agreement.

b. No business entity or professional business entity which enters into negotiations for, or agrees to, any contract or agreement with the State or any department or agency thereof or its independent authorities either for the rendition of personal services or furnishing of any material, supplies or equipment or for selling any land or building, if the value of the transaction exceeds $17,500, shall knowingly solicit or make any contribution of money, or pledge of a contribution, including in-kind contributions, to any candidate or holder of the public office having ultimate responsibility for the award of the contract, or to any State, county or municipal party committee or legislative leadership committee, between the commencement of negotiations for and the later of the termination of negotiations or the completion of the contract or agreement.

c. For purposes of this act, a "business entity" seeking a public contract means an individual including the individual's spouse, if any, and any child living at home; person; firm; corporation; professional corporation; professional corporation; partnership; organization; or association. The definition of a business entity includes all principals who own 10 percent or more of the equity in the corporation or business trust, partners, and offices in the aggregate employed by the entity as well as any subsidiaries directly controlled by the business entity.

d. For purposes of this act, "professional business entity" is a business entity as defined in subsection c. of this section which provides services by individuals who are required to be professionally licensed under the laws or regulations of this State.

e. Any individual meeting the definition of "professional business entity" under this section, including principals, who own 10 percent or more of the equity in the corporation or business trust, partners, and officers of an entity, may annually contribute a maximum of $250 each for any purpose to any candidate for the office of Governor or for the office of member of the Legislature, or $500 to any State, county or municipal party committee or legislative leadership committee, without violating subsection a. of this section. However, any group of individuals meeting the definition of "business entity" under this section, including such principals, partners, and officers of the entity in the aggregate, shall not annually contribute for any purpose in excess of $5,000 to all candidates for the office of Governor or for the office of member of the Legislature and officeholders with ultimate responsibility for the award of the contract, and all State, county and municipal political parties and legislative leadership committees combined, without violating subsection a. of this section.

f. For purposes of this section, the office that is considered to have ultimate responsibility for the award of the contract shall be:

(1) The Legislature, if the contract requires approval or appropriation from the Legislature;

(2) The Governor, if a public officer who is responsible for the award of a contract is appointed by the Governor, whether or not the appointment is subject to the advice and consent of the Senate, including independent authorities, and excluding members of boards, commissions, boards of trustees and other such entities appointed by the Governor; or

(3) Both.

g. For the purposes of this act, the terms "contribution," "in-kind contribution," "other thing of value," "candidate," "candidate committee," "joint candidates committee," "legislative leadership committee,""State, county or municipal political party" and "State, county or municipal party committee" shall have the meanings set forth in the "New Jersey Campaign Contributions and Expenditures Reporting Act," P.L.1973, c.83 (C.19:44A-1 et seq.).

3. No contribution of money or other thing of value, including in-kind contributions, made by a business entity or professional business entity to any candidate for the office of Governor or for the office of member of the Legislature or State, county or municipal party committee or legislative leadership committee shall be deemed a violation of P.L. , c. (C. )(now pending before the Legislature as this bill), nor shall an agreement for property, goods or services, of any kind whatsoever, be disqualified thereby, if that contribution was made by the business entity prior to the effective date of this section.

4. a. Prior to awarding any contract or agreement to procure services with any professional business entity, the State or any its purchasing agents or agencies, as the case may be, shall receive a sworn statement from the business entity made under penalty of perjury that the bidder or offeror has not made a contribution in violation of section 2 of P.L. , c. (C. )(now pending before the Legislature as this bill)

b. The professional business entity shall have a continuing duty to report any violations of P.L. , c. (C. )(now pending before the Legislature as this bill) that may occur during the negotiation of duration of the contract. The certification required under this section shall be made prior to entry into the contract or agreement with the State and shall be in addition to any other certifications that may be required by any other provision of law.

5. Candidates for the office of Governor or for the office of member of the Legislature, and State and county party committees and legislative leadership committees, shall use reasonable efforts to notify contributors and potential contributors that contributions, including in-kind contributions, from a business entity or professional business entity and certain individuals associated with the business entity or professional business entity defined in section 2 of P.L. , c. (C. )(now pending before the Legislature as this bill) may affect the ability of that business entity or professional business entity to contract or continue to contract with the State for property, goods, and services. Such reasonable efforts shall include, but not be limited to, notification in written fundraising solicitations or donor information request forms or other fundraising solicitation materials. The failure of a business entity or professional business entity to receive the notice prescribed in this section shall not be a defense to a violation of P.L. , c. (C. )(now pending before the Legislature as this bill).

6. A professional business entity or candidate for the office of Governor or for the office of member of the Legislature or officeholder or State, county or municipal party committee or legislative leadership committee may cure a violation of section 2 of P.L. , c. (C. ) (now pending before the Legislature as this bill), if, within 30 days after the general election, the professional business entity seeks and receives reimbursement of a contribution from the candidate for the office of Governor or for the office of member of the Legislature or State, county or municipal political party or legislative leadership committee.

7. a. It shall be a breach of the terms of the government contract for a business entity or professional business entity as defined in section 2 of P.L. , c. (C. )(now pending before the Legislature as this bill) or any other person to violate that section or to knowingly conceal or misrepresent contributions given or received, or to make or solicit contributions through intermediaries for the purpose of concealing or misrepresenting the source of the contribution, subject to penalties prescribed in subsection c. of this section and any other penalties prescribed by law.

b. No person shall make and no person, other than a candidate or an official representative of the candidate committee or joint candidates committee of the candidate, shall accept any contribution on the condition or with the agreement that it will be contributed to any other particular candidate, subject to penalties prescribed in subsection c. of this section and any other penalties prescribed by law. The expenditure of funds received by a person shall be made at the sole discretion of the recipient person.

c. Any business entity or professional business entity, as defined in section 2 of P.L. , c. (C. )(now pending before the Legislature as this bill), who knowingly fails to reveal a contribution made in violation of this act, or who knowingly makes or solicits contributions through intermediaries for the purpose of concealing or misrepresenting the source of the contribution, shall be disqualified from eligibility for future State contracts for a period of four calendar years from the date of the determination of violation by the Director of the Division of Purchase and Property or the Director for the Division of Property Management and Construction in the Department of the Treasury, as the case may be, and shall have any contract with the State then in effect immediately terminated.

8. Any county or municipality in the State of New Jersey shall have the option to promulgate and implement its own ordinances restricting campaign contributions by government contractors appropriate for the local jurisdiction.

9. a. Any business entity or professional business entity as defined in section 2 of P.L. , c. (C. )(now pending before the Legislature as this bill) making a contribution to any candidate, committee, or political party, and which has received, in any calendar year $50,000 or more through contracts from the State or county shall file an annual disclosure statement with the New Jersey Election Law Enforcement Commission setting forth all political contributions made by the business entity or professional business entity during the 12 months prior to the reporting deadline.

b. The Election Law Enforcement Commission shall prescribe forms and procedures for the reporting required in subsection a. of this section which, at a minimum, shall require the following information:

(1) The names and addresses of the persons or firms making the contributions, and the amount contributed;

(2) The name of the candidate committee or political party receiving the contribution; and

(3) The amount of money received from the State or a county through contract or agreement, the dates, and information identifying each contract and describing the service performed or goods provided.

c. The Election Law Enforcement Commission shall maintain a list of such reports for public inspection both at the commission's office and through the commission's electronic disclosure Web site.

10. This act shall take effect immediately.

STATEMENT

This bill prohibits business entities and professional business entities who contract with the State for goods or services in excess of $17,500 from making contributions of money or any other thing of value to any candidate for, or the holder of, any public office having ultimate responsibility for the award of the contract, or to any political party committee. Under the bill, a "business entity" is defined as an individual, an individual's spouse, or any child living at home, and any person, firm, corporation, professional corporation, partnership, organization or association. A "professional business entity" is a business entity which provides services by individuals who are required to be professionally licensed under the laws or regulations of this State.

The bill also places annual limits on the amount of money that an entity and principals of those entities--defined in the bill as anyone who owns 10% or more of the equity of the entity and partners and officers employed by the entity--can contribute to a candidate for State public office or a political party committee. For a business entity, the limit is $5,000 to all candidates for Governor or the Legislature and office holders with ultimate responsibility for the award of the contract and to all political party committees, including legislative leadership committees. For a professional business entity, the limit is $250 each for any purpose to a candidate for Governor or the Legislature and $500 to all political party committees, including legislative leadership committees.

The bill requires any business entity or professional business entity making a contribution to any candidate, committee or political party and which has received, in any calendar year, $50,000 or more in contracts with the State or a county, to file an annual disclosure form with the Election Law Enforcement Commission setting forth all political contributions made by the entity during the 12 months prior to the reporting deadline.