TPJ Disclosure Report: Summary

A 2003 campaign reform required Texas state candidates to disclose the employers and occupations of large campaign donors starting in January 2004.¹ Candidates are required to do so for any individual who gives them an aggregate of $500 or more in a given reporting period. As of January 1, 2005, candidates lacking this information are required to use their "best efforts" to obtain it. The law defines "best efforts" as making at least one documented oral or written request for it within 30 days of the contribution. The Texas Ethics Commission can impose a civil fine on violators of up to $5,000 or three times the amount involved in the violation—whichever is greater.² Alternatively, the commission can treat incomplete disclosure reports as late reports, which face a civil fine of up to $10,000.³

This report is a first attempt to gauge compliance with this new reform. It analyzes reporting of occupation and employer information by the 181 Texas lawmakers who had been elected as of November 2004.⁴ In particular, it analyzes every individual contribution of $500 or more that these lawmakers received in calendar years 2004 and 2005 and had reported to the Texas Ethics Commission by mid-January 2006.⁵

To grade these disclosure reports, researchers devised a standardized test: the Texas Assessment of Contributor Secrecy (TACS). They applied the TACS exam to the 14,454 individual contributions of $500 or more that the lawmakers reported receiving during calendar 2004 and 2005. These large contributions added up to more than $17 million.

Working blind to the identities of the recipient lawmakers, researchers graded how well the occupation and employer of each large donor was disclosed. While they tried to grant lawmakers the benefit of the doubt, researchers did not yield to what President Bush calls the “soft bigotry of low expectations.” Contributions with adequate disclosure of the donor’s employer and occupation received full credit. Contributions with adequate disclosure of either the donor’s employer or occupation received half credit. Finally, contributions that left these fields blank or provided inadequate disclosure information received zero credit. Inadequate disclosures are so vague that they obscure the donor’s occupation, employer or economic interest. Common examples include listing a donor as a “self-employed” “investor” or “businessman,” or listing a donor’s industry (e.g. “oil and gas”) as a donor’s occupation or employer.

The 181 lawmakers studied in this report collectively earned an “F” under both of these grading methods. Reflecting the disclosure law’s recognition that the need for disclosure rises with the amount of money contributed, this report emphasizes disclosure grades based on the total value of big contributions.⁶ While this report often provides both scores, when only one score is given it is based on value. Under this method, Texas lawmakers earned a failing disclosure grade of 58 percent. The same legislators collectively earned an even lower disclosure grade of 56 percent when graded on the basis of the total number of large contributions that they received.

Two Ways To Grade Donor Disclosure

Donor Disclosure Analyzed By	Total	Employer/Occupation Report Card
Number of Big Donations	14,454	F (56% well disclosed)
Value of Big Donations	$17,025,769	F (58% well disclosed)

^{1. House Bill 1606 codified as §254.0312 of the Elections Code.}

^{2. §571.173 of the Government Code}

^{3. See details at §254.042 of the Election Code.}

^{4. As such this report does not analyze campaign disclosures by the four new House members elected in special elections after November 2004 (Reps. Joes Straus, Ana Hernandez, Donna Howard and Kirk England).}

^{5. Note that this method is simpler than the disclosure law itself. The law requires candidates to disclose the employer and occupation of any individual who contributes an aggregate of at least $500 in a reporting period. For simplicity, this report just examines single individual contributions of $500 or more.}

^{6. Assume a politician who raised $100,000 in large contributions reported: $50,000 with full employer/occupation disclosure; $10,000 with one of the two fields disclosed; and $40,000 with no disclosure. This effort earns a 55 percent TACs grade, based on the formula [$50,000+($10,000/2)]/$100,000.}

II. Introduction

Two Ways To Grade Donor Disclosure