HB1519 HD1

PART I

SECTION 1. The legislature finds that the State's existing campaign finance law prohibiting organizations that receive state contracts from making campaign contributions does not extend to the compensated officers of the organizations or their immediate family members.

The legislature also finds that campaign contribution prohibitions do not currently apply to organizations that receive grants from the State. These grantees receive public funds appropriated by a legislative body, similar to state contractors.

Accordingly, the purpose of this Act is to reduce the potential for campaign contributions to unduly influence policymaking, maintain public trust in government decision-making, and improve actual and perceived standards of conduct by:

(1) Prohibiting compensated officers of state contractors, and their immediate family members, for the duration of their contracts exceeding the small purchase threshold established under the Hawaii public procurement code, from:

(A) Making, or promising to make, contributions to the candidate committee of a candidate who is a member of, or seeking election to, the same branch of the state government that exercises authority over the awarding or administration of the contract; or

(B) Soliciting any contribution from any person for any purpose; and

(2) Expanding the prohibition on campaign contributions by state contractors to include contributions from state grantees that receive grants exceeding $250,000, as well as from the compensated officers of those grantees and the compensated officers' immediate family members.

PART II

SECTION 2. Chapter 27, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

"§27- Disclosure of compensated officers and immediate family members for state contracts. (a) Within thirty calendar days of fully executing a state contract exceeding the small purchase threshold described in section 103D-305(a), the contracting state agency shall, pursuant to section 11-355, require the contractor to provide a list of the names of all compensated officers of the contractor and the immediate family members of each officer. The campaign spending commission shall prescribe a standard form and require the contractor to certify the accuracy of the form. Contractors shall update disclosures within thirty calendar days of any change in the officers or immediate family members.

(b) The contracting state agency shall make the reported information available electronically to the campaign spending commission within thirty calendar days of fully executing the contract, without obligation to verify accuracy or completeness for purposes of section 11-355.

(c) The contracting state agency's responsibility under this section shall be limited to receiving and transmitting the information submitted by the contractor. The contracting state agency shall not be responsible for verifying the accuracy, completeness, or correctness of the information submitted.

(d) Failure of a contractor to submit the information required under this section shall constitute a material noncompliance. A contracting state agency may withhold execution, suspend performance, or pursue remedies available under the contract or applicable law until the required information is submitted.

(e) For purposes of this section, "immediate family member" and "officer" have the same meanings as those terms are defined in section 11-355."

SECTION 3. Chapter 42F, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§42F- Disclosure of compensated officers and immediate family members for state grants. (a) Within thirty calendar days of fully executing a contract for a state grant exceeding $250,000, the expending agency executing the contract shall require the recipient to provide a list of the names of all compensated officers of the recipient and the immediate family members of each officer. The campaign spending commission shall prescribe a standard form and require the recipient to certify the accuracy of the form. Recipients shall update disclosures within thirty calendar days of any change in the officers or immediate family members.

(b) The expending agency shall make the reported information available electronically to the campaign spending commission within thirty calendar days of fully executing the contract, without obligation to verify accuracy or completeness for purposes of section 11-355.

(c) The expending agency's responsibility under this section shall be limited to receiving and transmitting the information submitted by the recipient. The expending agency shall not be responsible for verifying the accuracy, completeness, or correctness of the information submitted.

(d) Failure of a recipient to submit the information required under this section shall constitute a material failure to comply with the terms and conditions of the grant. An expending agency may withhold grant funds until the required information is submitted.

(e) For purposes of this section, "immediate family member" and "officer" have the same meanings as those terms are defined in section 11-355."

SECTION 4. Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§103D- Disclosure of compensated officers and immediate family members for state contracts. (a) Within thirty calendar days of fully executing a state contract exceeding the small purchase threshold described in section 103D-305(a), the purchasing agency shall, pursuant to section 11-355, require the contractor to provide a list of the names of all compensated officers of the contractor and the immediate family members of each officer. The campaign spending commission shall prescribe a standard form and require the contractor to certify the accuracy of the form. Contractors shall update disclosures within thirty calendar days of any change in the officers or immediate family members.

(b) The purchasing agency shall make the reported information available electronically to the campaign spending commission within thirty calendar days of fully executing the contract, without obligation to verify accuracy or completeness for purposes of section 11-355.

(c) The purchasing agency's responsibility under this section shall be limited to receiving and transmitting the information submitted by the contractor. The purchasing agency shall not be responsible for verifying the accuracy, completeness, or correctness of the information submitted.

(d) Failure of a contractor to submit the information required under this section shall be subject to sections 103D-702 and 103D-707.

(e) For purposes of this section, "immediate family member" and "officer" have the same meanings as those terms are defined in section 11-355."

SECTION 5. Chapter 103F, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§103F- Disclosure of compensated officers and immediate family members for state contracts. (a) Within thirty calendar days of fully executing a state contract exceeding the small purchase threshold described in section 103D-305(a), the purchasing agency shall, pursuant to section 11-355, require the contractor or provider to provide a list of the names of all compensated officers of the contractor or provider and the immediate family members of each officer. The campaign spending commission shall prescribe a standard form and require the contractor or provider to certify the accuracy of the form. Contractors or providers shall update disclosures within thirty calendar days of any change in the officers or immediate family members.

(c) The purchasing agency's responsibility under this section shall be limited to receiving and transmitting the information submitted by the contractor or provider. The purchasing agency shall not be responsible for verifying the accuracy, completeness, or correctness of the information submitted.

(d) Failure of a contractor or provider to submit the information required under this section shall constitute a material noncompliance. A purchasing agency may withhold execution, suspend performance, or pursue remedies available under the contract or applicable procurement law until the required information is submitted.

(e) For purposes of this section, "immediate family member" and "officer" have the same meanings as those terms are defined in section 11-355."

SECTION 6. Section 11-355, Hawaii Revised Statutes, is amended to read as follows:

"[[]§11-355[]] Contributions by state [~~and~~] or county contractors, state grantees, and the compensated officers and immediate family members of state contractors or grantees; prohibited. (a) It shall be unlawful for any person who enters into any contract with the State, any of the counties, or any department or agency thereof either for the rendition of personal services, the buying of property, or furnishing of any material, supplies, or equipment to the State, any of the counties, or any department or agency thereof, or for selling any land or building to the State, any of the counties, or any department or agency thereof, if payment for the performance of the contract or payment for material, supplies, equipment, land, property, or building is to be made in whole or in part from funds appropriated by the legislative body, at any time [~~between~~] from the execution of the contract through the completion of the contract, to:

(1) Directly or indirectly make any contribution, or promise expressly or impliedly to make any contribution, to any candidate committee or noncandidate committee, or to any candidate or to any person for any political purpose or use; or

(2) Knowingly solicit any contribution from any person for any purpose during any period.

(b) It shall be unlawful for any compensated officer of a state contractor under subsection (a), or the immediate family members of the compensated officer, that is awarded a state contract exceeding the small purchase threshold described in section 103D-305(a), at any time from the execution of the contract through the completion of the contract, to:

(1) Directly or indirectly make any contribution, or promise expressly or impliedly to make any contribution, to the candidate committee of a candidate who is a member of, or seeking election to, the same branch of the state government that exercises authority over the awarding or administration of that specific contract; or

(2) Knowingly solicit any contribution from any person for any purpose during any period.

(c) It shall be unlawful for any person that receives a grant exceeding $250,000, or any compensated officer of a state grantee that receives a grant exceeding $250,000, or the immediate family members of the compensated officer of a state grantee that receives a grant exceeding $250,000, from the State pursuant to chapter 42F, at any time from the execution of the contract through the completion of the contract for the grant, to:

(2) Knowingly solicit any contribution from any person for any purpose during any period.

(d) Any candidate, candidate committee, or noncandidate committee that receives a contribution made unlawful by this section shall return the unlawful contribution to the contributor within thirty calendar days of receipt. If any unlawful contribution is not returned to the contributor within thirty calendar days of receipt, the unlawful contribution shall escheat to the Hawaii election campaign fund.

[(b) Except as provided in subsection (a), this section does not prohibit or make unlawful the establishment or administration of, or the solicitation of contributions to, any noncandidate committee by any person other than the state or county contractor for the purpose of influencing the nomination for election, or the election of any person to office.]

(e) After receipt of the information submitted by a state agency pursuant to sections 27- , 42F- , 103D- , and 103F- , the commission shall make the information available to candidate committees and noncandidate committees on a password-protected section of the commission's website.

[~~(c)~~] (f) For purposes of this section[~~, "completion~~]:

"Completion of the contract" means that the parties to the government contract have either terminated the contract [~~prior to~~] before completion of performance or fully performed the duties and obligations under the contract, no disputes relating to the performance and payment remain under the contract, and all disputed claims have been adjudicated and are final.

"Immediate family member" means, notwithstanding section 11-302, the person's spouse or reciprocal beneficiary, as defined in section 572C-3, and any dependent of the person or spouse or reciprocal beneficiary of the dependent.

"Officer" means an individual who is listed as an officer on the department of commerce and consumer affairs business registration database."

SECTION 7. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2026-2027 for system updates, training, and administrative support for the state procurement office to implement this part.

The sum appropriated shall be expended by the state procurement office for the purposes of this Act.

PART III

SECTION 8. Section 11-364, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Any candidate, candidate committee, or noncandidate committee that receives in the aggregate more than the applicable contribution limit in section 11-357, 11-358, 11-359, or 11-360 shall return any excess contribution to the contributor within thirty calendar days of receipt of the excess contribution. Any candidate, candidate committee, or noncandidate committee that receives in the aggregate more than the applicable contribution limit in section 11-362 shall return any excess contribution to the contributor within thirty calendar days of the end of the election period; provided that the candidate, candidate committee, or noncandidate committee may choose which contributions to return. Any excess contribution not returned to the contributor within thirty calendar days shall escheat to the Hawaii election campaign fund."

PART IV

SECTION 9. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 10. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 11. This Act shall take effect on July 1, 3000; provided that section 7 shall take effect on July 1, 2026.

HOUSE OF REPRESENTATIVES	H.B. NO.	1519
THIRTY-THIRD LEGISLATURE, 2026		H.D. 1
STATE OF HAWAII