COLORADO SECRETARY OF STATE
8 CCR 1505-8
Rules Concerning Lobbyist Regulation

Preliminary Draft of Proposed Rules

July 31, 2008

Disclaimer:  This draft is not yet final.  The proposed changes to be considered at the public rulemaking hearing may be different than the proposed changes in this draft.  This draft is submitted to the Department of Regulatory Agencies for the purpose of complying with section 24-4-103(2.5), C.R.S., which requires that a draft be submitted to the Department at the time that a notice of proposed rulemaking is filed with the Secretary of State.

A final copy of the proposed rule changes will be available to the public no later than August 28, 2008, and a copy will be posted on the Department of State’s web site, in compliance with the requirement of section 24-4-103(4)(a), C.R.S., that “[a]ny proposed rule or revised proposed rule by an agency which is to be considered at the public hearing . . . shall be made available to any person at least five days prior to said hearing.”

Proposed additions to the current rules are reflected in small caps or underlined.  Proposed deletions from current rules are shown in stricken type.   Annotations may be included.

[Existing Rule 1 would be amended and relocated as New Rule 2]
RULE 1.  FEES.
(1)	The fee for manual filing of a professional lobbyist registration statement shall be fifty dollars ($50.00), except that the fee for a registration statement for the fiscal year beginning July 1, 2001 that is filed in writing before January 1, 2002 shall be twenty-five collars ($25.00) if the registering lobbyist requests to file electronically, and does file electronically, all monthly disclosure statements for the fiscal year that are due on or after January 1, 2002.
(2)	The fee for electronic filing of a professional lobbyist registration statement shall be twenty-five dollars ($25.00) if the registering lobbyist requests to file electronically, and does file electronically, all monthly disclosure statements for the fiscal year.
(3)	The fee for electronic filing of a professional lobbyist registration statement shall be forty dollars ($40.00) if the registering lobbyist does not request to file electronically, or does not file electronically, all monthly disclosure statements in connection with the registration.  If a lobbyist requests to file electronic monthly disclosure statements at the time of registration and subsequently files any disclosure statement manually, the remaining fifteen dollars ($15.00) of the fee set by this subsection (3) shall be due and payable at the time of manual filing of the written disclosure statement.
New Rule 1 would be adopted as follows:
Rule 1.  Definitions
1.1	“Bona fide personal emergency,” as used in section 24-6-302 (7), means:
1.1.1	Medical emergencies including: incapacitation, hospitalization, accident involvement, death of persons or to members of such persons’ immediate family;
1.1.2	Practical emergencies Including: Extraordinary obstacles out of the control of the lobbyist or lobbyist firm that preclude timely disclosure such as the loss or unavailability of records or a computer due to fire, flood or theft, or other compelling reasons beyond the lobbyist’s or lobbyist firm’s control.
1.2	“Rulemaking official,” as used in section 24-6-301 (1.7)(b), C.R.S., means an official of a state agency who has jurisdiction or authority to adopt any proposed rule, standard, or rate.  Depending on the organizational makeup of any particular state agency, “rulemaking officials” may or may not be elected officials, department heads, or certain department employees.
1.3	“State Liaison” means the one person designated by each principal department who is responsible for any lobbying by a state official or employee on behalf of the principal department, pursuant to section 24-6-303.5 (1)(a), C.R.S.
1.4	“Substantial Violation” means any one of the following violations of Part 3 of Title 24 of the Colorado Revised Statutes:
A.	failure to register as a lobbyist pursuant to sections 24-6-303 or 24-6-303.5, C.R.S.;
B.	Failure to file a monthly disclosure report within fifteen days of the due date while the general assembly is in session, pursuant to sections 24-6-303 (3)(a) and 24-6-303.5 (2)(b), C.R.S.;
C.	Failure to file a monthly disclosure report within thirty days past the due date while the general assembly is not in session, pursuant to sections 24-6-303 (3)(a) and 24-6-303.5 (2)(b), C.R.S.;
D.	Knowingly underreporting any item of income or expenditures by any amount on the disclosure statement;
E.	Underreporting income or expenditures by twenty percent or more on the entire disclore statement;
F.	Any violation of the provisions of sections 24-6-306, 24-6-307, or 24-6-308, C.R.S.;
G.	Any other violation that the Secretary of State deems “substantial,” taking into consideration the following factors derived from Fabec v. Beck, 922 P.2d 330 (Colo. 1996):
1.	the extent of noncompliance;
2.	the purpose of the applicable provision and whether that purpose is substantially achieved despite the alleged noncompliance; and
3.	whether there was a good-faith effort to comply or whether noncompliance is based on a conscious decision to lobby covered officials without registering or filing disclosure statements.
[Existing Rule 2 would be amended and relocated as New Rule 3]
RULE 2.  ELECTRONIC FILING.
(1)	Any professional lobbyist who wishes to file a registration statement and monthly disclosure statements electronically shall first submit a written request therefor to the secretary of state.  The request shall be submitted either in hard copy form or in electronic form.  A request may be submitted in electronic form by transmitting to the secretary of state a completed electronic request form over the Internet or by submitting a request by e-mail, as may be directed by the secretary of state’s web site.  The request shall contain:
(a)	The lobbyist’s name and the name of not more than one authorized agent who may electronically file on the lobbyist’s behalf;
(b)	 Contact information for the individual who will be responsible for electronic filing, including mailing address, telephone number, and e-mail address of the lobbyist or the authorized agent, as the case may be;
(c)	An affirmation by the lobbyist that any identification number and password issued by the secretary of state will not be disclosed by the lobbyist to third parties, except to the authorized agent of the lobbyist, and that the identification number and password will not be used in an unauthorized manner;
(d)	An agreement by the lobbyist to report promptly to the secretary of state any change to the lobbyist’s or authorized agent’s mailing address, telephone number, or e-mail address;
(e)	An agreement by the lobbyist to report any theft, loss, or compromise of the lobbyist’s identification number or password;
(f)	An agreement by the lobbyist that the secretary of state may terminate the electronic filing status for any of the following reasons:
(i)	Failure to keep contact information current with the secretary of state;
(ii)	Disclosure to any unauthorized person(s) or misuse of the assigned identification number or password;
(iii)	Termination of lobbyist status; or
(iv)	Other good cause shown.
(g)	Such additional information as the secretary of state may require in order to establish and maintain an accurate, accessible, secure, electronic lobbyist filing and information system.
(2)	Promptly after receiving a request for electronic filing as provided in this Rule 2, the secretary of state shall assign the professional lobbyist a unique identification number and password and e-mail such number and password to the professional lobbyist or the authorized agent at the e-mail address furnished by the professional lobbyist in the request for electronic filing.  The identification number and password shall remain valid unless terminated by the secretary of state or the lobbyist; except that, the electronic filing system established by the secretary of state may enable the professional lobbyist or the authorized agent to change the password or other contact information within limitations prescribed by the secretary of state.
(3)	Any professional lobbyist to whom the secretary of state has issued a lobbyist identification number and a password may file registration statements and monthly disclosure statements electronically.  Electronic filings shall be in the format and on forms prescribed by the secretary of state from time to time.
(4)	The electronic disclosure statement form may provide a space to list specific bill numbers and a brief description of the subject matter.  Any information on bills may be carried over from month-to-month with a provision to add new information or to delete information no longer relevant.
(5)	A lobbyist may designate a different authorized agent by submitting a new request for electronic filing in the manner provided by subsection (1) of this Rule 2.  In such case, the secretary of state may issue a new password to the new authorized agent.
(6)	When the lobbyist or authorized agent utilizes the electronic filing system to submit to the secretary of state, with the identification number and password assigned as provided in this Rule 2, a registration statement or disclosure statement, such submission shall constitute the lobbyist’s or agent’s electronic signature as provided by section 24-71.1-106, Colorado Revised Statutes, under penalty of perjury as provided by law.
New Rule 2 would be adopted as follows:
Rule 2.  Fees
2.1	The fee for filing a professional lobbyist registration statement shall be forty dollars ($40.00) except that the fee for a registration statement may be waived for a professional lobbyist for a not-for-profit organization in accordance with Rule 2.2.
2.2	Upon written request, the Secretary of State may waive the registration fee for a professional lobbyist for a not-for-profit organization who meets one or more of the following conditions:
(a)	The lobbyist derives his or her lobbyist compensation solely from the organization; and
(b)	(i)	The lobbyist’s organization is operating under financial hardship conditions; or
(ii)	The lobbyist will have particular interest in only one issue or bill and does not intend to lobby throughout the State fiscal year.
[Existing Rule 3 would be amended and relocated as New Rule 3.5]

RULE 3.  PUBLIC ACCESS.
(1)	The secretary of state shall provide the public with electronic access over the Internet to lobbyist filings and information exclusively on a “read only” basis.
(2)	Automated extraction of bulk data from the secretary of state’s web site, such as by means of computerized “robots” or “data mining”, is prohibited.  Upon request, the secretary of state will provide bulk data for a fee established pursuant to section 24‑21‑104, Colorado Revised Statutes.
New Rule 3 would be adopted as follows:
Rule 3.  Electronic Filing
3.1	Except as provided in Rule 3.2, all applications for registration and disclosure reports filed with the Secretary of State pursuant to Title 24, Article 6, Part 3 shall be filed electronically.  Reports required to be filed electronically with the Secretary of State under this rule that are presented for manual filing shall not be accepted.  This rule shall not apply to cumulative annual reports filed pursuant to section 24-6-302 (3)(b), C.R.S.
3.2	In accordance with section 24-21-111, C.R.S., reports are not required to be filed electronically if the Secretary of State has granted an exception to the electronic filing requirement after written application based on hardship or other good cause shown.  All applications for an exception shall include a brief statement of the hardship or good cause for which the exception is sought.  Applications must be received by the secretary of state at least fifteen (15) calendar days prior to the first applicable filing deadline, unless the exception is based on emergency circumstances arising after such deadline, in which case the nature of the emergency shall be described in the application.  The filing of an application for exception based on emergency circumstances does not delay any reporting deadlines, however, if a penalty is imposed for failure to file a report on the due date, the penalty may be set aside or reduced in accordance with section 24-6-302 (7), C.R.S.
3.3	For the purposes of this rule 3, “electronic filing” is defined as the filing of reports required by Title 24, Article 6, Part 3 of the Colorado Revised Statutes utilizing the internet system created by the Secretary of State pursuant to section 24-6-303 (6.3)(a).
3.4	When the lobbyist or authorized agent utilizes the electronic filing system to submit to the Secretary of State, with the identification number and password assigned as provided in this Rule 3, a registration statement or disclosure statement, such submission shall constitute the lobbyist’s or agent’s electronic signature as provided by section 24-71.1-106, Colorado Revised Statutes, under penalty of perjury as provided by law.
3.5	Public Access
3.5.1	The Secretary of State shall provide the public with electronic access over the Internet to lobbyist filings and information exclusively on a “read only” basis.
3.5.2	Automated extraction of bulk data from the Secretary of State’s web site, such as by means of computerized “robots” or “data mining”, is prohibited.  Upon request, the Secretary of State will provide bulk data for a fee established pursuant to section 24-21-104, Colorado Revised Statutes.
[Existing Rule 4 would be relocated as New Rule 2.2]
RULE 4.  WAIVER OF FEES.
(1)	Upon written request, the secretary of state may waive the registration fee for a professional lobbyist for a not-for-profit organization who meets one or more of the following conditions:
(a)	The lobbyist derives his or her lobbyist compensation solely from the organization; and
(b)  (i)	The lobbyist’s organization is operating under financial hardship conditions; or
(ii)	The lobbyist will have particular interest in only one issue or bill and does not intend to lobby throughout the State fiscal year.
Rule 5 would be amended as follows:
Rule 4.  Disclosure RULE 5.  DISCLOSURE OF GIFTS/ENTERTAINMENT.
4.1	In accordance with section 24-6-301 (1.9) (a) (IV), Colorado Revised Statutes, a lobbyist shall disclose in monthly disclosure statements specific gifts to covered officials with a value of fifty dollars ($50.00) or more, whether or not the lobbyist made any expenditure for such gifts.
4.1.1	The monthly disclosure statement for professional lobbyists shall fulfill all requirements of sections 24-6-302 (2) and 24-6-301 (1.9), C.R.S.
4.1.2	The monthly disclosure statement for a lobbying firm shall fulfill all requirements of sections 24-6-302 (2) and 24-6-301 (1.9), C.R.S.
4.1.3	The monthly disclosure statement for state liaisons shall fulfill all requirements of section 24-6-303.5 (2)(a), C.R.S.
New Rule 5 would be adopted as follows:
Rule 5.  Record Retention
5.1	For professional lobbyists and lobbyist firms, records required to be retained pursuant to section 24-6-304 (1), C.R.S., shall include but not be limited to:
a.	Receipts for expenditures or contributions made;
b.	Documentation of income;
c.	Contracts, whether verbal or written; 
d.	Documentation relating to a direct business association;
e.	Documentation or other evidence relating to legislation for which the professional lobbyist has been retained; and 
f.	Any other evidence relating to lobbying activity which may be useful in the event of an audit or investigation by the Secretary of State.
5.2	For state liaisons, records required to be retained pursuant to section 24-6-304(1) C.R.S., may be retained in the form of a log, spreadsheet or other appropriate tracking mechanism and shall include but not limited to:
a.	hours spent on lobbying;
b.	the amount of public funds expended; and,
c.	the legislation, bill, bill papers being supported, opposed or monitored.
New Rule 6 would be adopted as follows:
Rule 6.  Enforcement
6.1	Waiver Process
6.1.1	Pursuant to section 24-6-302 (7), C.R.S., any professional lobbyist or lobbyist firm registered with the Secretary of State may request an imposed fine to be excused or reduced by submitting a written request by letter, email, fax or hand-delivery within thirty (30) days of the imposition of fine.  The request should include:
a.	The name of the registered lobbyist;
b.	The date of the request;
c.	The due date of the delinquently filed disclosure report(s);
d.	The actual filing date of the delinquently filed disclosure report(s);
e.	A brief summary of the reasons, circumstances, or other justification of the “bona fide personal emergency”;
f.	Any measures the lobbyist or firm has instituted or plans to institute to avoid future delinquencies, if applicable; and
g.	Other relevant information
6.2	Complaints
6.2.1	In accordance with section 24-6-305 (2)(c),C.R.S., any person who believes a lobbyist, including a state liaison, or lobbyist firm has not complied with the requirements of section 24-6-302 et seq., C.R.S., or this Rule 6 may file a written complaint with the Secretary of State.
6.2.1.1	A written complaint filed with the Secretary of State shall contain the following information:
a.	The complainant’s name;
b.	The complainant’s full residence address and mailing address (if different from residence);
c.	A description of the alleged violation, which may include a reference to the particular statute or rule;
d.	The name of the lobbyist or lobbyist firm;
e.	The date and location of the alleged violation, if known; and
f.	Other applicable or relevant information
6.2.1.2	The Secretary of State shall review all complaints submitted in writing and conduct such investigations as may be necessary and appropriate.  If the Secretary of State determines that a violation may have occurred, the Secretary of State shall take appropriate action as set forth in section 24-6-305, C.R.S.
6.2.1.3	Upon receipt of a properly submitted complaint, the Secretary of State shall notify via certified mail the lobbyist and his or her lobbyist firm, or in the case of a state liaison, the state liaison and his or her executive director or elected official of:
a.	The date and factual basis of each act with which the lobbyist or firm is being charged;
b.	The particular provision of the statute alleged to have been violated;
C.	What action(s) the Secretary of State plans to take; and
d.	Other relevant information