April 24, 2018
Opinion No. 2018-02
Rep. Jason Probst
P.O. Box 3262
Hutchinson, Kansas 67504
Synopsis: For campaign receipts and expenditures reports, required by K.S.A. 25-4148, the reporting of proceeds from the sale of political materials hinges on whether the sale is bona fide. Proceeds from bona fide sales are reported in the aggregate and are not subject to contribution limits. Proceeds from non-bona fide sales are reported as contributions and subject to contribution limits.
Cited herein: K.S.A. 25-4143(e)(1), 25-4148, and K.A.R. 19-27-2.
Dear Rep. Probst,
We understand that you request this opinion as an incumbent Kansas representative standing for reelection in 2018. Our opinion regarding application of the Kansas campaign finance act, K.S.A. 25-4119e, et seq., (act) responds to your request received February 27, 2018. Pursuant to K.S.A. 75-4303a(a), jurisdiction of the Kansas Governmental Ethics Commission (commission) is limited to applicability of the act. The commission’s opinion does not address whether some other statutory system, common law theory, or agency rule or regulation applies to your inquiry.
QUESTIONS
How should proceeds from the sales of political materials be reported?
Are proceeds from the sales of political materials subject to contribution limits?
ANALYSIS AND CONCLUSION
The Kansas campaign finance act defines “contribution” in K.S.A 25-4143:
(e) (1) "Contribution" means:
(A) Any advance, conveyance, deposit, distribution, gift, loan or payment of money or any other thing of value given to a candidate, candidate committee, party committee or political committee for the express purpose of nominating, electing or defeating a clearly identified candidate for a state or local office.
(B) Any advance, conveyance, deposit, distribution, gift, loan or payment of money or any other thing of value made to expressly advocate the nomination, election or defeat of a clearly identified candidate for a state or local office;
(C) a transfer of funds between any two or more candidate committees, party committees or political committees;
(D) the payment, by any person other than a candidate, candidate committee, party committee or political committee, of compensation to an individual for the personal services rendered without charge to or for a candidate's campaign or to or for any such committee;
(E) the purchase of tickets or admissions to, or advertisements in journals or programs for, testimonial events;
(F) a mailing of materials designed to expressly advocate the nomination, election or defeat of a clearly identified candidate, which is made and paid for by a party committee with the consent of such candidate.
Bona Fide Sales of Political Materials. Political materials include, but are not limited to, “political campaign pins, buttons, badges, flags, emblems, hats, banners and literature.” K.S.A. 25-4148(b)(3).
This subparagraph requires each report to state “the aggregate amount of proceeds from bona fide sales of political materials.” Hence, reporting of proceeds from bona fide sales is made in the aggregate, and is not subject to more specific reporting requirements for contributions or contribution limits.
Even though reported in aggregate, a record of the receipt of proceeds from the bona fide sales of political materials, including the date of each sale and a description of the materials sold, must be maintained by each treasurer for a campaign, pursuant to K.A.R. 19-27-2.
Non-Bona Fide Sales of Political Materials. The act refers to bona fide sales of political materials, presumably to distinguish such sales from those that are not bona fide. The act does not define bona fide. Black’s Law Dictionary, 8th Ed., at page 186, defines bona fide as (1) “[m]ade in good faith; without fraud or deceit,” and (2) “[s]incere; genuine.” The latter definition is most applicable to the contextual use of term in K.S.A. 25-4148(b)(3). We opine a sale is bona fide if the proceeds from the sale reasonably reflect the value of the political materials. In our opinion, a bona fide sale is analogous to a retail sale.
Therefore, sales proceeds substantially exceeding the inherent value of the political materials sold are not from a bona fide sale. Such proceeds are practically contributions and must be treated as contributions for purposes of reporting, recordkeeping, and contribution limits under the act.
Sincerely,
G. Daniel Harden, Chairman
By Direction of the Commission
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