§ 2-10-114 — Campaign funds - Allocation of unexpended contributions - Use of funds - Specifically prohibited uses of funds - Allocation of funds on death of incumbent or candidate

(a) Any candidate for public office in this state shall allocate an unexpended balance of contributions after the election to one (1) or a combination of the following: (1) The funds may be retained or transferred to any campaign fund pursuant to Tennessee reporting requirements; (2) The funds may be returned to any or all of the candidate's contributors, in accordance with a formula or plan specified in the candidate's disclosure of the allocation; (3) The funds may be distributed to the executive committee of the candidate's political party; (4) The funds may be deposited in the volunteer public education trust fund established under title 49, chapter 3, part 4; (5) The funds may be distributed to any organization described in 26 U.S.C. § 170(c) ; (6) The funds may be distributed to an organization that has received a determination of exemption from the United States internal revenue service pursuant to 26 U.S.C. § 501(c)(3) or (4) , if such organization is currently operating under such exemption; (7) The funds may be used to defray any ordinary and necessary expenses incurred in connection with the office of the officeholder. Such expenses may include, but are not limited to, the cost of advertisements, membership fees, and donations to community causes; and (8) The funds may be distributed to any institution of public or private education in the state, for the purpose of supplementing the funds of an existing scholarship trust or program. (b) (1) Except as provided in subsection (a), no candidate for public office shall use any campaign funds for any other purpose other than a contribution or expenditure as defined by this part. The disbursement of campaign funds for a candidate's own personal use is not permitted. For the purpose of this section, "personal use" means any use by which the candidate for public office or elected public official would be required to treat the amount of the expenditure as gross income under 26 U.S.C. § 61 , or any subsequent corresponding Internal Revenue Code section. (2) Expenditures that are specifically prohibited under this section include, but are not limited to: (A) Any residential or household items, supplies or expenditures, including mortgage, rent or utility payments for any part of any personal residence of a candidate or officeholder or a member of the candidate's or officeholder's family; (B) Mortgage, rent, or utility payments for any part of any nonresidential property that is owned by a candidate or officeholder or a member of a candidate's or officeholder's family and used for campaign purposes, to the extent the payments exceed the fair market value of the property usage; (C) Funeral, cremation, or burial expenses related to deaths within a candidate's or officeholder's family; (D) Clothing, other than items of de minimis value that are used in the campaign; (E) Tuition payments within a candidate's or officeholder's family other than those associated with training campaign staff or associated with an officeholder's duties; (F) Dues, fees, or gratuities at a country club, health club, or recreational facility, unless they are part of a specific fundraising event that takes place on the organization's premises; (G) Salary payments to a member of a candidate's family, unless the family member is providing bona fide services to the campaign. If a family member provides bona fide services to the campaign, any salary payment in excess of the fair market value of the services provided is a prohibited use; (H) Admission to a sporting event, concert, theater, activity, charitable event or other form of entertainment, unless the event is an expense associated with a legitimate campaign or officeholder activity, where the tickets to such event are provided to students attending schools, guests or constituents of the candidate or officeholder, or persons involved in the candidate's or officeholder's campaign; (I) Payments for grooming or enhancing one's personal appearance unrelated to campaign activities; or (J) Payment of any fines, fees, or penalties assessed pursuant to this chapter or title 3, chapter 6. (3) A violation of this subsection (b) is a Class 2 offense as defined in § 2-10-110(a)(2) . (c) In addition to the manner in which unexpended balances in the campaign account of a candidate may be allocated under subsection (a), if an incumbent dies while in office and has an unexpended balance in a campaign account, and if such incumbent's surviving spouse or child is appointed to fill the unexpired term of the deceased incumbent or is elected to the office previously held by the deceased, then the balance remaining in the campaign account of such deceased incumbent shall be transferred to the campaign account of the surviving spouse or child of the deceased incumbent for use by such surviving spouse or child as a candidate for election to public office in accordance with this part. (d) (1) In the event a candidate for public office dies with an unexpended balance of contributions in such candidate's campaign account and subsection (c) is not applicable, then the following individuals, in the descending order, are authorized to allocate such unexpended balance to those persons, political parties, or charitable organizations listed in subdivisions (a)(2)-(6) and (a)(8): (A) The deceased candidate, if the candidate provided for allocation of an unexpended balance through the candidate's will; (B) The deceased candidate's treasurer, unless the candidate was the treasurer; (C) The surviving spouse of the deceased candidate, if the candidate was the treasurer; and (D) The next of kin of the deceased candidate, if subdivisions (d)(1)(B) and (C) do not apply. (2) If a decision is not made by any such individual, or individuals where subdivision (d)(1)(D) applies, within one (1) year of the date of death of the deceased candidate, then the unexpended balance shall be distributed by the registry of election finance to the volunteer public education trust fund established under title 49, chapter 3, part 4. (e) Notwithstanding subsection (a), if a member of the general assembly raises funds for a local public office during the time the general assembly is in session in accordance with § 2-10-310(a) , then any unexpended balance of contributions in the campaign account established by that member of the general assembly for the member's candidacy for local public office shall not be used for or distributed to a campaign fund: (1) For the benefit of any election for any candidate for the general assembly; (2) For the benefit of any statewide election, or any state, national or other political party; (3) For the benefit of any state, national or other political party caucus; or (4) For the benefit of any state, national or other political party caucus member. (f) In addition to the manner in which unexpended balances in the campaign account of a candidate may be allocated under subsection (a), a member of the general assembly may use the funds to: (1) Pay for lodging expenses or pay for a portion of lodging expenses on the same day the member earns mileage reimbursement or per diem, pursuant to § 3-1-106 , if the lodging is necessitated by the normal course of the member's duties and the member is not otherwise eligible for reimbursement for such lodging or the member's reimbursement does not cover the total amount of the lodging expense; and (2) Reimburse the member for mileage above the mileage for which the member is reimbursed by this state for travel to Nashville, if the additional miles traveled are necessitated by the normal course of the member's duties. (g) (1) Transfers of funds or assets from a candidate's campaign account or a political campaign committee controlled by a candidate for a federal election to a candidate's campaign account or a political campaign committee of or for such candidate in an election for a state or local public office in this state are prohibited. (2) Transfers of excess funds or assets from a candidate's political campaign committee or campaign account for election to a local public office to a political campaign committee or campaign account of or for such candidate in an election to the general assembly or governor in this state are prohibited.

Legislative History

Amended by 2023 Tenn. Acts, ch. 108, s 7, eff. 4/4/2023. Amended by 2022 Tenn. Acts, ch. 1026, s 1, eff. 5/11/2022. Acts 1992, ch. 932, § 1; 2001, ch. 384, § 1; 2002, ch. 470, § 2; 2002, ch. 600, § 1; 2005, ch. 163, §§ 3, 4; 2006 (1st Ex. Sess.), ch. 1, § 8; 2011 , ch. 389, § 2.