New Annual Financial Disclosure Reports in Michigan

Under the newly enacted Candidate for Office Financial Disclosure Act & Public Officers Financial Disclosure Act, many candidates and public officials will have new annual financial disclosure requirements with the State of Michigan beginning in 2024. This impacts our clients because different parties and transactions between candidates, officeholders, businesses, lobbyists, and other entities may be disclosed to the public more than before. It is important to understand the impact that these disclosures will have on our clients so that we can limit potential sensitive disclosures about personal, business, and lobbying activities.

Who is affected by both Acts?

• • Candidates for and current officeholders of governor, lieutenant governor, attorney general, secretary of state, state senate, and state representative.

What does each Act require?

• • Annual financial disclosure report from each candidate or officeholder in those statewide or state legislature seats.
  • Prevents a candidate for office from being seated after elected if the candidate did not file a financial disclosure report.

What sensitive information is included in the annual financial disclosure report?

• • Spouse’s name, occupation, and employer.
  • If spouse is a registered lobbyist or lobbyist agent.
  • Positions held and source of employment-based income during the previous calendar year if more than $1,000.
  • Positions currently held as an officer, director, trustee, consultant, partner, proprietor, representative, or employee.
  • Non-business assets, securities, and real property with a fair market value of $1,000 or more held during the previous calendar year.
  • Any non-employment-based income of more than $200 during the previous calendar year.
  • General terms and source of any agreements or arrangements regarding future employment, leave of absence, continuation or deferral of payments or benefits from an employer.

Current officeholders (not candidates) are required to report three additional disclosures received from and reported by a lobbyist or lobbyist agent:

• • Gifts (if reported by a lobbyist or lobbyist agent)
    • The new law uses the definition of gifts from the Michigan Lobby Registration Act. Note that gifts from lobbyists and lobbyist agents to public officials are prohibited.
    • Meals and refreshments for immediate consumption, however, are permitted and must be reported if the meal exceeds $76 (NEW 2024 limit) during any one-month period or $475 (NEW 2024 limit) between January 1 and the close of books for reporting.
    • So, the only gifts reportable for this disclosure are meals and refreshments from a lobbyist or lobbyist agent that exceed the monetary thresholds.
  • Travel payments (if reported by a lobbyist or lobbyist agent)
    • Travel and lodging payments for or reimbursed to a public official in excess of $1,000 (NEW 2024 limit).
  • Charity payments made in lieu of an honorarium (if reported by a lobbyist or lobbyist agent)
    • An honorarium is a payment for an appearance, speech, article, or activity related to the performance of the officeholder’s duties. So, instead of paying an honorarium, the lobbyist or lobbyist agent provides payment to a charity.

When is the annual financial disclosure report due?

• • For candidates: By May 15, 2024, and by May 15 of every following year.
  • For officeholders: By April 15, 2024, and by May 15 of every following year.