a) A utility and any of its subsidiaries and any committee, 501(c)(4) organization, 527 organization, or separate segregated fund connected to a utility shall not make a donation or contribution to any of the following:

i) A 501(c)(4) organization or a 527 organization that is controlled or directed by any of the following:

1) A candidate for state elective office;

2) An elected state official;

3) A former elected state official;

4) An appointed state official;

5) A state or local party committee; or,

6) A 501(c)(4) organization or 527 organization in which a state or local candidate, appointed official, or elected official controls or sits on the board of that organization.

ii) A 501(c)(4) organization or 527 organization in which a candidate for state elective office, appointed state official, elected state official, formered elected state official, or affiliate is employed by or sits on the board of that organization;

iii) A candidate committee;

iv) A political party committee;

v) A political action committee.

b) In addition to complying with Section a) above, a utility or any of its subsidiaries may not use its money or other property in connection with a political contribution or independent expenditure unless the shareholders of the utility, by the affirmative vote of a majority of all vote entitled to be cast, have:

i) Authorized in advance the total amount of money or property that may be used for all political expenditures (including independent expenditures) during a specific fiscal year of the corporation; and,

ii) Directed that the money or property be used to support:

1) A specified candidate or candidates;

2) Candidates of a specified political party or parties;

3) A specified political party or parties;

4) A specified political committee or committees;

5) A specified entity or entities exempt from taxation under 501(c)(4) or (6) of the Internal Revenue Code; or

6) A specified question or questions.

c) The following expenses, whether paid directly or indirectly, through reimbursement or otherwise, incurred by a utility or affiliated interest shall not be included or incorporated in operating expenses or otherwise be recovered in rates:

i) Any contributions or gifts made to political candidates, political parties, political or legislative committees, or any committee or organization working to influence referendum petitions or elections, including any contribution made to support independent expenditures or to a group that makes independent expenditures;

ii) Expenditures for grassroots lobbying;

iii) More than fifty percent of annual total compensation or expense reimbursement for members of the Board of Directors of the utility;

iv) Tax penalties or fines issued against the utility;

v) Investor-relation expenses;

vi) Advertising and public relations expenses that do not directly relate to a purpose or program that is required or authorized under statute or commission rule or order. Advertising and public relations expenses for which cost recovery is prohibited includes:

1) Communications to promote or improve the utility’s brand;

2) Expenses for the purpose of influencing public opinion about or creating good will toward the utility;

3) Expenses related to marketing and administration of customer service for unregulated products or services provided or sold by the utility or the utility’s affiliates;

vii) Organizational or membership dues, or other contributions, to any organization, association, institution, corporation, or other entity that engages in lobbying or similar activities intended to influence the outcome of any local, state, or federal legislation, ordinance, resolution, rule, ballot measure, or other regulatory decision, including but not limited to business or industry trade associations;

viii) Contributions to organizations qualified under Section 501(c)(4) of the Federal Internal Revenue Code;

ix) Charitable contributions to organizations qualified under Section 501(c)(3) of the Federal Internal Revenue Code, except when there is a legitimate energy efficiency, energy use reduction, or utility ratepayer assistance purpose;

x) Entertainment or gift expenses; 

xi) Any amount expended to compensate attorneys or technical experts, who are not public utility company staff, to prepare and litigate a general rate case filing. The [Public Utilities Commission] shall consider whether additional costs associated with rate case filings should be deemed not recoverable and utilize rulemaking authority to that effect; and,

xii) Any amount expended to meet the reporting requirements included in Section e) of this Act, other than an allowable administrative expense to be determined by the [Public Utilities Commission].

d) Enforcement

i) If the [Public Utilities Commission or Other State Entity] determines that a utility improperly recovered costs pursuant to Section c) of this Act, the [Public Utilities Commission or Other State Entity] may assess a nonrecoverable penalty against the utility. The [Public Utilities Commission or Other State Entity] shall order the utility to refund the amount improperly recovered pursuant to Section c) of this Act, plus interest, to customers.

ii) If the [Public Utilities Commission] determines that a utility, or its subsidiaries, has violated Section a) or b) of this Act, the [Public Utilities Commission or Other State Entity] may assess a non recoverable penalty against the utility. The penalty shall not exceed the greater of the following:

1) Three times the amount of the expenditure made in violation of Section a) of this Act; or

2) $5,000 per violation, to be inflation adjusted annually, of Section a) or b) of this act.

iii) If the [Public Utilities Commission] determines that a utility, or its subsidiaries, has violated any provision of this Act, the [Public Utilities Commission] may refer the case to the Attorney General. The Attorney General may bring action to obtain any appropriate relief, including but not limited to:

1) A temporary restraining order;

2) A temporary or permanent injunction;

3) A civil penalty;

4) A declaratory judgment;

5) Rescission; and,

6) Restitution.

e. Reporting

i) On or before [1 year after enactment], and annually thereafter, each utility shall file a report with the [Public Utilities Commission] to ensure the utility’s compliance with this section. The report must include:

1) The purpose, payee, and amount of any expenses associated with the costs and activities that are not permitted to be recovered from customers pursuant to Section c) of this Act.

2) An accounting of the contributions and independent expenditures, made in compliance with Section b) of this Act, including but not limited to:

(a) The date of the contribution or independent expenditure;

(b) The amount of the contribution or independent expenditure;

(c) The identity of the recipient of the contribution, or if an independent expenditure, the identity of the candidate, referendum, political party, pending legislation, public policy, or government rule or regulation supported or opposed; and

(d) The business rationale for each such contribution or independent expenditure.

3) Such report shall also include, but need not be limited to:

(a) Any costs spent by the parent company or affiliates of the utility directly billed or allocated to the utility;

(b) A list of the title, job description, and salary of any employees of the utility who performed work associated with the activities described in Sections b) or c) of this Act and the hours attributed to such work;

(c) A list of the title, job description and salary of any employees of the parent company or affiliate who performed work associated with the activities described in Sections b) or c) of this Act and the hours attributed to such work that were directly billed or allocated to the utility; 

(d) An itemized list of costs that the utility made to all third-party vendors for any expenses associated with activities described in Sections b) or c) of this Act, including unredacted billing amounts, billing dates, payees and explanation of the expenditure in detail sufficient to describe the purpose of the cost; and,

(e) Any other itemized information deemed relevant by the [Public Utilities Commission].

ii) The utility shall provide a copy of the annual report required by this section to shareholders after filing the report with the [Public Utilities Commission].

f) Rulemaking

i) By [1 year after enactment] the [Public Utilities Commission] shall initiate rulemaking to amend its rules under the [State Statute] to implement the requirements of this Act. 

g) Definitions. For the purposes of this Act:

i) “Grassroots lobby” means:

1)  to communicate with members of the general public to solicit them to communicate directly with any covered official for the purpose of influencing legislative action when that solicitation is made by:

(a) A broadcast, cable or satellite transmission;

(b) A communication delivered by print media;

(c) A letter or other written communication delivered by mail or by comparable delivery service;

(d) A communication delivered by e-mail, a website, or any other digital format; 

(e) A telephone; or,

(f) A method of communication similar to those listed in paragraphs (a) through (e).

2) “Grassroots lobbying” does not include a person communicating with the person’s stockholders, employees, board members, officers or dues-paying members.

ii) “Legislative action” means the drafting, introduction, consideration, modification, enactment or defeat of any bill, resolution, amendment, report, nomination, or other matter by the Legislature, by either the [House of Representatives] or the [Senate], any committee or an official in the Legislative Branch acting in the official’s official capacity, or action of the Governor in approving or vetoing any legislative document presented to the Governor for the Governor’s approval.

iii) “Lobbying” means to communicate directly with any official in the legislative branch or any official in the executive branch or with a constitutional officer for the purpose of influencing any legislative action or with the Governor or the Governor’s cabinet and staff for the purpose of influencing the approval or veto of a legislative action when reimbursement for expenditures or compensation is made for those activities. “Lobbying” includes the time spent to prepare and submit to the Governor, an official in the legislative branch, an official in the executive branch, a constitutional officer, or a legislative committee oral and written proposal for, or testimony or analyses concerning, a legislative action. “Lobbying” does not include time spent by any person providing information to or participating in a subcommittee, stakeholder group, task force or other work group regarding a legislative action by the appointment or at the request of the Governor, a Legislator or legislative committee, a constitutional officer, a state agency commissioner, or the chair of a state board or commission.

iv) “Political action committee” includes:

1) Any separate or segregated fund established by any corporation, membership organization, cooperative or labor organization whose purpose is to influence the outcome of an election, including a candidate or question; and,

2) Any person which serves as a funding and transfer mechanism and by which moneys are expended to advance, promote, defeat, influence in any way, or initiate a candidate, campaign, political party, referendum or initiated petition in this State.

v) “Utility” means an investor-owned electric, gas, or water utility [optional: sewage and sanitation; cross reference state statutes defining electric, gas, and water utilities] in the State.

h) The provisions of this act are severable. If any provision of this act or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.