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FREQUENTLY ASKED QUESTIONS: ADMINISTRATIVE WAIVERS

 1. What does “timely filed” mean?

 2. How much are the late fines?

 3. How do I pay a late fine?

 4. How do I request a waiver or reduction of a late fine?

 5. What is the late letter process?

 6. What happens if I do not respond to the TEC late letters?

 7. What happens when a late fine is assessed?

 8. What are the TEC rules on late fine waiver/reductions?

 9. What happens in the administrative review process?

10. How do I request an appeal of an administrative late fine determination made under the TEC Rules?

11. I am a “local” filer. Do I have to pay a late fine for a late-filed report?

1. What does “timely filed” mean?

A report is timely filed if it is complete and filed by the applicable deadline using the reporting method required by law.

If the document is filed electronically, using the TEC electronic filing system, it is considered timely filed if it is successfully transmitted by midnight, Central Time Zone, on the last day for filing the report under the applicable law.

To file on paper, the filer must file the Affidavit of Exemption form with the appropriate paper report form prescribed by the TEC to describe their statutory exemption from electronic filing. The Affidavit of Exemption must be included with each report filed on paper. See Who Has to File Electronically in the Candidates FAQ for more details.

If the document is a pre-election report filed on paper (30-day pre-election report, 8-day pre-election report, runoff report, or daily pre-election report), it must be RECEIVED by the TEC by the filing deadline to be timely filed. (Note: The postmark date does not matter for pre-election reports.)

Other reports (not pre-election) filed on paper are timely filed if postmarked or hand-delivered to the TEC in the correct format by the deadline.

2. How much are the late fines?

When a report that is required to be filed with the TEC is filed late or not filed at all, the law sets a late fine amount based on the type of report:

• 8-day pre-election reports: The late fine for a campaign finance report due eight (8) days before a primary, general, uniform, or special election is:
  
  
• $500 for the first day the report is late; and
  
  
• $100 for each day thereafter that the report is late through the date the report is filed, up to a maximum of $10,000.
  
  
• First semiannual report after the primary or general election: The late fine for the first semiannual campaign finance report required to be filed following the primary or general election is:
  
  
• $500 for the first day the report is late; and
  
  
• $100 for each day thereafter that the report is late through the date the report is filed, up to a maximum of $10,000.
  
  
• The following TEC filers are subject to this accruing fine for a semiannual report after the primary or general election:
  
  
• Any candidate or officeholder whose name appeared on the applicable primary or general election ballot (regardless of whether he or she filed pre-election reports);
  
  
• A GPAC that supported or opposed a candidate or measure in an election (regardless of whether the committee filed pre-election reports); and
  
  
• A GPAC that filed a pre-election report for the applicable election.
  
  
• All other campaign finance reports: The late fine for all other campaign finance reports, including daily pre-election reports and runoff reports, is $500.
  
  
• Personal Financial Statements: The late fine for a personal financial statement is $500.
  
  
• Lobby Reports: The late fine for lobby reports, including lobby activities reports and lobby registrations, is $500.
  
  
• Legislative Caucus Reports: The late fine for a caucus report (Form LEG) is $500.
  
  
• Reports More Than 30 Days Late: If a report is more than 30 days late, the TEC sends a warning letter of liability by registered mail to the person required to file the report. If the assessed late fine is not paid before the 10th day after receipt of the registered letter, the fine may be increased by an amount determined by the TEC up to $10,000. Fine increases are considered and voted on by the TEC commissioners at a TEC public meeting.

Certain Committees Exempt from Civil Penalties: Section 254.164 of the Election Code provides that the TEC may not impose a civil penalty on a general-purpose committee (GPAC, MPAC, or CEC) for a reporting violation if the committee did not exceed the following contribution or expenditure thresholds during the reporting period covered by the late report in question or during either of the two reporting periods preceding the late report in question:

1. did not accept political contributions totaling $3,000 or more;
   
   
2. did not accept political contributions from a single person totaling $1,000 or more; and
   
   
3. did not make political expenditures totaling $3,000 or more.

To be eligible for a waiver under Section 254.164 (referred to as a “HB 89 waiver”) the committee must file the late report in question. Additionally, this law does not exempt a committee’s campaign treasurer from his or her filing requirements as the campaign treasurer of a GPAC.

3. How do I pay a late fine?

Submit a late fine payment by either: (1) check or money order made payable to the Texas Ethics Commission for the total amount. Your canceled check will serve as your receipt for the late fine payment, or (2) credit card by calling 512-463-5800 and leaving a message asking someone to call you to take your payment for a late fine. At this time, the TEC is unable to accept fine payments by credit card electronically.

You may deliver your payment to the TEC:

• by U.S. Mail:
  
  
• P.O. Box 12070,
• Austin, Texas 78711-2070
  
  
• by contract carrier or hand-delivery to the TEC’s physical address:
  
  
• Sam Houston Building,
• 201 East 14th Street, 10th Floor,
• Austin, Texas 78701
  
  

Important Tips:

• Please include a note with your payment identifying the filer and report with which the payment is associated. (Example: Jane Doe, TEC Filer ID# 00099999, semiannual report due 1/15/18.) If you received a notice of late report (late letter) regarding the late fine, please include a copy of the letter with your payment. This information will help the TEC when processing your payment.
  
  
• In Ethics Advisory Opinion No. 206 (1994) the TEC determined that payment of a fine for filing a late campaign finance report with the TEC is a political expenditure. Therefore, a filer may use political funds to pay a late fine.
• Late fines are imposed on the “person required to file the report.” See Elec. Code § 254.042, TEC Rule 18.26, and Government Code §§ 305.033 and 572.033.

Note for Candidates and Officeholders: A candidate/officeholder, not the candidate’s/officeholder’s campaign treasurer, is responsible for filing reports under title 15 of the Election Code. Even though the late fine is the personal responsibility of the candidate/officeholder, it is permissible for payment to come from political contributions, the campaign treasurer’s personal funds, or the personal funds of the candidate/officeholder. See Elec. Code §§ 254.041, 254.042. How the candidate/officeholder reports the payment differs depending on the source from which the fine is paid. See Ethics Advisory Opinion No. 206 (1994).

Note for Political Committees: The campaign treasurer of a political committee is responsible for filing reports under title 15 of the Election Code, and therefore the campaign treasurer is liable for any fine imposed on a political committee for filing a committee report late. The political committee may, however, use political contributions to pay a late fine imposed on the committee’s campaign treasurer. Ethics Advisory Opinion No. 206 (1994); see also Ethics Advisory Opinion No. 216 (1994) (corporate sponsor of general-purpose political committee may pay late fine imposed on campaign treasurer as an administrative expense) and Ethics Advisory Opinion No. 315 (1996) (campaign treasurer of a general-purpose committee is liable for any fine imposed for filing a committee report late.)

Please note: The payment of a civil or criminal fine for failure to file a report, or for filing a report late, does not satisfy a filer’s obligation to file the report. Late fines continue to accrue until the report is filed.

4. How do I request a waiver or reduction of a late fine?

All filers who are required by law to file with the TEC (“TEC filers”) are subject to an administrative civil penalty (“late fine”) if a report is not timely filed by the applicable filing deadline. A TEC filer who is assessed a late fine may submit payment of the fine or submit a Statement of Defense requesting waiver or reduction of the fine, if the filer believes there are circumstances that might warrant a waiver or reduction.

Important Tips:

• The late report in question must be filed in the correct format before the TEC may consider a request for waiver or reduction of a late fine.
  
  
• If you missed the deadline, file the report as soon as possible through the TEC’s online electronic filing application. When a report is electronically “filed” you will receive a confirmation email. If you have not received a confirmation email for the report in question, the report has not been filed. Therefore, you should log in to the filing application and make sure you have not left the report “in progress.”
  
  
• You may submit a request for a waiver or reduction of a late fine as soon as you know that the report is late. You do not need to wait for the TEC to send a late notice.
  
  
• A request for a waiver or reduction of a late fine should use the Statement of Defense form.
  
  
• Your Statement of Defense must be typed or printed in a clearly legible format. It should explain the facts and circumstances that you believe might justify a waiver or reduction under the TEC rules, including such information as the reason the report was late; the date you learned that the report was late, if known; whether you contacted the TEC for assistance with filing the report, including the dates, times, and names of the person(s) who assisted you, if known; and any other information pertaining to the late report.
  
  
• You may deliver your Statement of Defense to the TEC in one of two ways: EMAIL the signed PDF attachment to affidavits@ethics.state.tx.us or MAIL the signed form to Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070.
  
  
• If you submit both a waiver/reduction request and the fine payment, the TEC deposits the payment and considers the request. If after the TEC reviews your request it determined that you are eligible for a reduction or waiver ofthe fine,the TEC will refundthe allowable amount.
  
  
• Note: the request for waiver or reduction must be submitted tothe TEC within 210 days of the due date of the report at issue,or it cannot be considered. If you fail to submit the Statement of Defense within 210 days,the request can only be considered upon a showing of good cause to explainthe delay in filing the Statement of Defense.
  
  
• Your Statement of Defense must be typed or printed in a clearly legible format. It should explain the facts and circumstances that you believe might justify a waiver or reduction under the TEC rules, including such information as the reason the report was late; the date you learned that the report was late, if known; whether you contacted the TEC for assistance with filing the report, including the dates, times, and names of the person(s) who assisted you, if known; and any other information pertaining to the late report.
  
  
• You may deliver your Statement of Defense to the TEC in one of two ways: EMAIL the signed PDF attachment to affidavits@ethics.state.tx.us or MAIL the signed form to Texas Ethics Commission, P.O. Box 12070, Austin, Texas 78711-2070.
  
  
• If you submit both a waiver/reduction request and the fine payment, the TEC deposits the payment and considers the request. If after the TEC reviews your request it determined that you are eligible for a reduction or waiver ofthe fine,the TEC will refund the allowable amount.
  
  
• Note: the request for waiver or reduction must be submitted to the TEC within 210 days of the due date ofthe report at issue,or it cannot be considered. Ifyou fail to submit the Statement of Defense within 210 days, the request can only be considered upon a showing of good cause to explain the delay in filing the Statement of Defense.
  
  

5. What is the late letter process?

• 1st notice of late report — The first late letter is sent to the filer by First Class U.S. Mail to the address on file. This letter explains the filing obligation and late fine. The filer must either pay the late fine or submit a Statement of Defense requesting a waiver or reduction of the fine within 210 days of the due date of the report. (Note: The late report in question must be filed in the correct format before the TEC may consider a waiver/reduction request.) This letter also explains the consequences for failure to satisfy the filing requirements.
  
  
• 2nd notice of late report — The second late letter is sent to the filer by First Class U.S. Mail. This letter explains that the TEC previously sent a notice asking for a response within 20 days of the date of the notice and the 20 days have passed without a response from the filer. This letter also explains the consequences for failure to respond.
  
  
• 3rd notice of late report — The third late letter is sent to the filer by registered mail. This letter explains that the TEC previously sent two notices regarding the filing obligation and the late fine and has received no response or payment from the filer. This letter also lists the consequences for failure to respond, as the 1st and 2nd notices did, and informs the filer that the TEC will proceed with these enforcement actions. If the report is more than 30 days late or has not been filed, this letter also serves as a determination notice and warning of liability that the TEC may impose an additional fine of up to $10,000.
  
  
• Notice of Referral to the Attorney General a Comptroller — The notice of referral letter is sent to the filer by registered mail. This letter is the final notice and explains that the TEC has referred the late fine to the Office of the Attorney General for collection and to the Comptroller’s Office for warrant hold proceedings.
  
  

6. What happens if I do not respond to the TEC late letters? The matter of the late fine will be referred to the Office of the Attorney General (“OAG”) for enforcement.

Note: Once the matter is referred to the OAG, that office has its own procedures for collecting the fine, which may include filing a lawsuit against the filer. At that point, the filer must contact the OAG to resolve the matter.

• The filer’s name will be posted on the Delinquent Filer Lists on the TEC’s website and sent for publication in the Texas Register.
  
  
• The TEC will report the filer’s name and the indebtedness to the state’s Comptroller of Public Accounts. The TEC will then use the warrant hold procedures of the Comptroller’s Office to ensure that payments from the state are not issued to the filer until the debt is settled.
  
  
• The TEC may also refer the matter to the appropriate attorney for criminal prosecution.
  
  

7. What happens when a late fine is assessed?

• After a filing deadline, the TEC Disclosure Filings Division runs reports from the TEC’s reports database to determine which filers filed late or did not file the required report at all and sends letter(s) to those filers regarding the late fine assessed for the late or unfiled report (informally referred to as late letters). If the missing report has been filed or the report was filed late, payment of the late fine at any point during the administrative late letter process resolves the administrative matter and no further action is taken. If the TEC receives a request for a waiver or reduction of a late fine at any point during the administrative late letter process, the process is suspended until the request is considered and resolved.
  
  
• A TEC filer who is assessed a late fine may submit payment of the fine and/or submit a Statement of Defense requesting waiver or reduction of the fine. (Note: The late report in question must be filed in the correct format before the TEC may consider a waiver/reduction request.)
  
  
• If a TEC filer who is assessed a late fine does not respond to any of the late letters with either the fine payment or a waiver/reduction request, the TEC proceeds with the enforcement procedures outlined in the late letters, including referring the matter to the Office of the Attorney General and the Comptroller of Public Accounts for collection of the fine, inclusion of the filer's name on the Delinquent Filer List on the TEC's website, and may also include a referral to the appropriate attorney for criminal prosecution.
  
  
• If the TEC receives a request for a waiver or reduction of a late fine, the late letter process is suspended until the request is resolved. The waiver/reduction request is reviewed administratively under Chapter 18 of the TEC rules. The TEC rules are applied to determine whether or not the late report is eligible for a waiver or reduction of the fine and the TEC legal staff sends a letter to the filer explaining the determination (“TEC rules determination letter”). If the late fine was reduced or not waived, the filer is given approximately 30 calendar days from the date of the determination letter (the TEC calculates an exact date and provides that date in the letter) to pay the late fine or request an appeal.
  
  
• The TEC rules determination letter explains how a filer may appeal if the filer is not satisfied with the rules determination, if the filer is eligible to file an appeal. Appeals are considered by the TEC commissioners at a TEC public meeting. The TEC commissioners have the authority to make the final decision to waive, reduce, or affirm the late fine.
  
  
• After a TEC public meeting at which a TEC filer's administrative appeal regarding a late fine is heard, the TEC sends a letter informing the filer of the TEC's decision. The filer is given approximately 30 calendar days from the date of the appeal determination letter (TEC calculates an exact date and provides that date in the letter) to pay the late fine, if any. If the filer does not respond to the TEC letter, the TEC proceeds with the enforcement procedures as outlined in the letter, including referring the matter to the Office of the Attorney General and the Comptroller of Public Accounts for collection of the fine, inclusion of the filer's name on the Delinquent Filer List on the TEC's website, and may also include referral to the appropriate attorney for criminal prosecution.

8. What are the TEC rules on late fine waiver/reductions?

When the TEC receives a Statement of Defense requesting a waiver or reduction of a late fine, the administrative late letter process is suspended until the request is considered and resolved.

In an effort to provide a consistent, fair, and efficient process, the TEC adopted a set of rules to allow the executive director to administratively determine whether a filer is eligible for a waiver or reduction of a late fine. The administrative determinations are based on the criteria, charts, and reduction formulas provided in the rules. If a filer is not satisfied with the administrative determination or has special circumstances that would make the determination under the rules unjust, the filer may appeal to the TEC commissioners for consideration.

Administrative Waiver of a Fine: Chapter 18 of the TEC Rules allows an administrative waiver of a late fine in specific circumstances.

To be eligible for a waiver or reduction, the Statement of Defense must be filed within 210 days of the day the report at issue was due. In addition, all other reports must be filed and the filer must have no outstanding civil penalties. Penalties with a pending Statement of Defense are not considered outstanding.

TEC Rule 18.24 — This rule defines “prior late offense” for the purpose of granting a waiver or reduction of the pending civil penalty. A “prior late offense” is any report for which a civil penalty was assessed, regardless of whether the civil penalty was later waived or reduced. This includes prior reports where the civil penalty was granted an HB 89 waiver.

“Prior late offense” does not include:

• Reports for which no late notices were sent and the filer did not submit a Statement of Defense; and
  
  
• Reports determined by the executive director to be not required.

Finally, Rule 18.24 lays out the process for appealing a determination made under the administrative process.

TEC Rule 18.25 — This rule sets out the provisions for an administrative waiver or reduction of a late fine for a Report Type I (non-critical report).

A non-critical report is a report other than a report under Tex. Elec. Code §§ 254.064(c), 254.124(c), or 254.154(c) or the first report under §§ 254.063 or 254.123 that is required to be filed following the primary or general election. See Tex. Elec Code §254.042(b) for more information.

TEC Rule 18.26 — This rule sets out the provisions for an administrative waiver or reduction of a late fine for a Report Type II (critical report).

A critical report is a report filed under Tex. Elec. Code §§ 254.064(c), 254.124(c), or 254.154(c) or the first report under §§ 254.063 or 254.123 that is required to be filed following the primary or general election. See Tex. Elec Code §254.042(b) for more information.

The determination is based on the amount of activity in the report at issue (total political expenditures or political contributions in the reporting period) and the number of prior late offenses in the last five years.

The determination is based on the amount of activity in the report at issue (total political expenditures or political contributions in the reporting period) and the number of prior late offenses in the last five years.

9. What happens in the administrative review process?

• When the TEC receives a Statement of Defense requesting a waiver or reduction of a late fine, the administrative late letter process is suspended until the request is considered and resolved.
  
  
• After reviewing the request and applying the TEC rules, the TEC sends a determination letter to the filer explaining that the TEC rules determination is one of the following: 1) that the report is eligible for a waiver of the fine; 2) that the report is eligible for a reduction of the fine; 3) the report does not qualify for a waiver or reduction of the fine; or 4) the report is ineligible to be reviewed for a waiver or reduction. Most determinations are eligible for an appeal. If the fine is not waived, the determination letter also explains the following:
• the filer may find the applicable rules on the TEC’s website (the exact webpage URL address is provided in the letter);
  
  
• if the late fine was not waived, the filer has approximately 30 calendar days from the date of the letter (the TEC calculates an exact date and provides that date in the letter) to pay the late fine or request an appeal;
  
  
• if the TEC does not receive the payment or request for appeal by the date specified in the letter, the TEC will proceed with the steps enumerated in the letter, which could include referring the matter to the Office of the Attorney General and the Comptroller of Public Accounts for collection of the fine, inclusion of the filer’s name on the Delinquent Filer List on the TEC’s website, and may also include a referral to the appropriate attorney for criminal prosecution.
  
  
• If the Statement of Defense was filed more than 210 days after the report at issue was due, no waiver or reduction can be considered and the determination is not eligible for an appeal, unless the filer shows good cause that explains the delay in filing the Statement of Defense.

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10. How do I request an appeal of an administrative late fine determination made under the TEC Rules?

If your determination letter states that you can file an appeal, you must submit that appeal in writing to the Commission. Appeals can be submitted to appeals@ethics.state.tx.us, using the Determination Appeal form, and should state your reasons for requesting an appeal, provide any additional information needed to support the request, and state whether you would like the opportunity to appear before the Commission and offer testimony regarding the appeal. After hearing a request for appeal, the Commission may affirm the determination made under the Rules or make a new determination based on facts presented in the appeal.

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11. I am a “local” filer. Do I have to pay a late fine for a late-filed report?

No, you do not. The Administrative process for late-filed reports only applies to filers who are required to file their reports with the Texas Ethics Commission. Local filers who file their reports late can be subject to the Ethics Commission’s jurisdiction through the sworn complaint process, which has its own set of rules and procedures.