BILL ANALYSIS
SENATE COMMITTEE ON ELECTIONS, REAPPORTIONMENT AND
CONSTITUTIONAL AMENDMENTS
Senator Ron Calderon, Chair
BILL NO: AB 583 HEARING
DATE: 6/18/08
AUTHOR: HANCOCK ANALYSIS BY:
Darren Chesin
AMENDED: 6/11/08
FISCAL: YES
SUBJECT
California Clean Money and Fair Elections Act of 2008
DESCRIPTION
Existing law limits the amount of campaign contributions
that a person or group can make to a candidate for state
elective office, as specified.
Existing law provides that no public officer shall spend
and no candidate shall accept any public moneys for the
purpose of seeking elective office.
Existing law provides that the Political Reform Act (PRA)
may be amended to further its purposes by statute, passed
in each house of the Legislature by a two-thirds vote or
amended or repealed by a statute that becomes effective
only if approved by the voters.
Bill Overview
This bill repeals a provision of state law that prohibits
public officers and candidates from expending public funds
for the purpose of seeking elective office and establishes
the California Clean Money and Fair Elections Act of 2008
(Act), a pilot project for a voluntary system of public
financing political campaigns for Secretary of State (SOS)
during the 2015 election cycle. The operative provisions
of this bill would appear for voter approval on the June,
2010 Primary Election ballot and would sunset on January 1,
2015.
This bill provides substantial public financing to SOS
candidates who demonstrate support by collecting numerous
small contributions. Participating candidates receive a
public financing grant that pays for virtually all campaign
activities. In exchange for receiving the public funds,
candidates must agree not to raise any funds privately,
with the exception of those small contributions collected
to demonstrate support. Non-participating candidates would
continue to be subject to existing contribution limits.
The Fair Political Practices Commission (FPPC) would have
primary responsibility for the administration of this
program.
This bill would create the Clean Money Fund (CMF) and,
commencing January 1, 2011, would transfer an annual
amount, subject to a future appropriation by the
Legislature, from the General Fund to the CMF. It would
continuously appropriate those moneys in the CMF to the
FPPC for the purpose of the public financing provisions.
Funding for the administrative and enforcement costs of the
act would also be subject to appropriation by the
Legislature.
Significant Provisions
a.Allows a candidate who desires to receive public campaign
funding to solicit seed money contributions from
registered voters to pay for the costs of qualifying to
receive public campaign funding. Provides that a seed
money contribution shall not exceed $100 per donor, and
the aggregate amount of seed money contributions received
by a candidate shall not exceed $75,000.
b.Requires major party candidates to collect $5
contributions from 7,500 different registered voters in
order to receive public financing for the primary
election campaign. Requires a candidate who is not
seeking the nomination of one of the major parties to
collect 15,000 contributions of $5 each in order to
receive public funding.
c.Provides a base amount of public campaign financing of $1
million for a primary election and $1.5 million for a
general election.
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d.Permits specified candidates to receive additional public
campaign funds to match any expenditure by a
nonparticipating candidate that exceeds the amount of
public funds received by the participating candidate
under specified circumstances. Also permits specified
candidates to receive additional public campaign funds to
match any independent electioneering expenditure made in
support of opponents' candidacies or made in opposition
of his or her candidacy, as specified but caps the amount
of additional money that a candidate may receive to match
these expenditures.
e.Reduces the amount of public funds that a candidate
receives if that candidate does not face an adequately
funded opponent, as defined.
f.Prohibits candidates from using public campaign funding
for any of the following purposes:
Costs of legal defense or fines resulting from
any campaign law enforcement proceeding;
The candidate's personal support or compensation
to the candidate or the candidate's family;
The candidate's personal appearance;
A contribution or loan to the campaign committee
of another candidate or to a party committee or other
political committee;
An independent electioneering expenditure;
A gift in excess of $25 per person; or,
Any payment or transfer for which compensating
value is not received.
g.Prohibits a participating candidate from receiving
private contributions from any source other than
qualifying contributions, seed money contributions, or
contributions from a political party that do not exceed
5% of the original public campaign financing allotment to
the candidate.
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h.Requires all candidates in contested races who receive
public funds to participate in at least one debate during
a contested primary election and two debates during a
contested general election.
i.Provides that the following sources of revenue shall be
deposited into the CMF:
All qualifying contributions collected by
candidates seeking to qualify for public financing;
Any seed money contributions collected by
candidates seeking to qualify for public financing
that are not spent by the candidate during the
exploratory period or the qualifying period;
All funds previously distributed to a
participating candidate that remain unspent by the
candidate following the election for which the funds
were distributed;
Voluntary donations made to the CMF;
BACKGROUND
Campaign Finance Reform . Over the last three decades,
there have been numerous attempts to reform the way in
which campaign funds are raised, spent, and disclosed in
California. Many of these attempts were made by way of the
initiative process while others were products of the
Legislature.
In response to the Watergate scandal, California voters
approved Proposition 9, the Political Reform Act (PRA), in
June 1974. Some portions of the original PRA were
invalidated by the courts, e.g., mandatory campaign
expenditure caps and a prohibition on contributions from
lobbyists. The PRA has been amended hundreds of times
since enactment and, among other things, currently
regulates campaign finance disclosure, contributions,
expenditures, lobbying practices, government conflicts of
interest and ethics.
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In spite of Proposition 9's passage, prior to 1988 there
were no limits on the amount of money candidates for
California state office could accept or spend. In June
1988, voters approved two separate campaign finance reform
initiatives, Proposition 68 and Proposition 73.
Proposition 68 proposed a system of public funding and
expenditure limits for state legislative races, and passed
with 53% of the vote. Proposition 73 prohibited public
funding of campaigns and set contribution limits for state
and local elections, and passed with 58% of the vote.
The California State Supreme Court subsequently ruled in
1990 in Taxpayers to Limit Campaign Spending v. FPPC that
because the two measures contained conflicting
comprehensive regulatory schemes they could not be merged
and only one could be implemented. As such, since
Proposition 73 received more affirmative votes than
Proposition 68, the Court ordered the implementation of
Proposition 73 and proclaimed all provisions of Proposition
68 invalid. In 1990, all state and local elections were
conducted under the Proposition 73 limits.
Many of the provisions of Proposition 73 were ultimately
ruled unconstitutional by the federal courts. The federal
case ended in 1993 when the United States Supreme Court
denied certiorari in Service Employees International Union
v. FPPC .
The proponents of Proposition 73 then petitioned the
California State Supreme Court to rewrite the
unconstitutional portions of the measure to make it
enforceable. The Court narrowly rejected that request even
though it previously alluded that such a rewriting would be
possible. The only provisions of Proposition 73 to survive
legal challenge were contribution limits for special
elections, restrictions on certain mass mailings by
officeholders, and the prohibition on the use of public
money for campaign purposes.
Another initiative, Proposition 208 was approved by the
voters in 1996. Proposition 208 was sponsored by many of
the same individuals and organizations behind Proposition
68. This new measure enacted a campaign finance reform
plan consisting of variable contribution limits, i.e.,
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candidates who agree to abide by a voluntary expenditure
cap would be rewarded with contribution limits higher than
those imposed on candidates who refused the expenditure
cap. Transfers of campaign funds between different
candidates and their committees were also prohibited.
Additionally, candidates for statewide office were
prohibited from accepting contributions more than 12 months
prior to the primary election, while all other candidates
were prohibited from accepting contributions more than 6
months prior to the primary election.
Proposition 208 was also challenged in federal court after
it was approved by the voters and was almost immediately
enjoined from enforcement. The court initially concluded
the contributions limits were so low that they precluded an
opportunity to conduct a meaningful campaign and thereby
infringed on a candidate's First Amendment rights
(legislative candidates could not accept contributions in
excess of $250 per election from each donor, or $500 if
they accepted the expenditure cap). The court also
suggested that the notion of variable contribution limits
was coercive.
The proponents of Proposition 208 were still pursuing
appeals in federal court when it was largely repealed by
Proposition 34, a legislative ballot measure approved by
the voters in November, 2000. Proposition 34, in
conjunction with SB 34 (Burton) Chapter 241 of 2001,
imposed contribution limits, limited candidate-to-candidate
transfers, prohibited certain lobbyist contributions,
provided for voluntary spending limits in exchange for
candidate access to ballot pamphlets, enhanced on-line
reporting of large contributions, and increased fines for
violations of the PRA. The provisions of Proposition 34
and SB 34 remain intact today and would not be repealed or
amended by AB 583.
Proposition 89
This bill is a SOS-only pilot project version of
Proposition 89, an initiative measure that appeared on the
November, 2006 general election ballot. Proposition 89
would have allowed candidates for state office who collect
a specified number of $5 contributions and who agree to
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limit their campaign spending to receive funding from the
state to run their campaigns. Proposition 89 was defeated
by the voters, receiving just 25.7% of the vote statewide.
Other Public Campaign Financing Measures . Proposition 131,
an initiative measure which garnered only 37.75% of the
vote in November 1990 would have, among other numerous
provisions, provided partial public campaign financing for
candidates to state office who agree to specified campaign
expenditure limits. However, it should be noted that this
measure also contained a term limits proposal that term
limits advocates opposed because it was less restrictive
than the competing Proposition 140, which was approved by
the voters.
Proposition 25, an initiative measure which received only
34.7% of the vote in March, 2000 would have, among other
numerous provisions, provided public financing of campaign
media advertisements and voter information packets for
qualifying candidates and ballot measure committees.
Other States . Voters in Maine, Massachusetts, and Arizona
have approved laws to provide substantial public financing
to state candidates who demonstrate support by collecting a
number of small contributions. Candidates who participate
in "Clean Elections" receive a public financing grant that
funds all campaign activities. In exchange for receiving
the public funds, candidates agree not to raise any funds
privately, with the exception of those small contributions
collected to demonstrate support. These laws went into
effect in Maine and Arizona for the 2000 elections.
Initial studies of the Maine and Arizona programs show
public financing has resulted in a substantial increase in
the number of contested races and in small donor
participation.
COMMENTS
1.According to the author , the current campaign finance
system requires candidates to devote a substantial amount
of time to fund-raising while diminishing the time in
which candidates have to communicate with voters. The
ever-increasing amount of money that is necessary for a
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successful political campaign is an almost insurmountable
hurdle that limits the pool of candidates who can run for
office. The consequence of this is that public office is
not a position reserved for common citizens, but rather a
place for those who are independently wealthy or who can
fund-raise large amounts of money from moneyed interests
that often have a stake in government decisions.
The pressure on a candidate in the current campaign
financing system on fund-raising diminishes a candidate's
time on developing public policy positions and fostering
one-on-one contact with voters. As the time legislators
spend on fundraising has increased, both the confidence
in elected officials and voter participation has
decreased. AB 583 would provide a small but powerful
step toward improving this system in shifting the
emphasis away from a competition in fund-raising toward a
system of competition in the market place of ideas.
Assembly Bill 583 would enact what has been come to be
known around the country as the "Clean Money" system of
public financing of elections. Simply put, Clean Money is
a voluntary system in which candidates who raise a
substantial number of $5 dollar contributions from people
who live in the districts they seek to represent - and
agree not to take a dime from any other private source -
will receive full public financing of their campaign.
This system will allow candidates to spend their time
talking to people about their needs, priorities and
ideas.
AB 583 provides public financing for campaigns as a
voluntary alternative of financing a campaign. However,
it allows a candidate to choose the traditional system of
fundraising. Experiences in other states show that the
Clean Money system curbs spiraling campaign costs while
increasing voter participation. Evaluations of these
Clean Money systems show that they are preferred by
candidates. In Arizona, 28 out of the 32 candidates for
statewide office ran "Clean" in 2002. In Maine, 70% of
the State Senate and 50% of the House ran "Clean"
elections also in 2002.
Amendments to the bill narrow the Clean Money system from
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Governor and two legislative seats to apply solely the
Secretary of State. These amendments provide substantial
cost reductions and apply to a seat that directly
supports and oversees our democratic process.
2.No Clear Advantage . This bill requires voter approval
but provides that its funding is subject to a future
appropriation by the Legislature. It is assumed that the
author chose to place this bill on the ballot because
that only requires a majority vote of the Legislature
while direct implementation would require a two-thirds
votes because it amends the PRA. However, delaying
ultimate implementation pending a future Legislative
appropriation will require a two-thirds vote for that
appropriation or another trip to the ballot. In light of
these circumstances, it would seem prudent to include an
appropriation in this bill.
3.Horseshoes and Hand Grenades . This bill states that its
provisions shall be submitted to the voters at the "June
1, 2010 statewide primary election." The primary
election in 2010, however, is on June 8, not June 1.
4.Previous Legislation . AB 583 (Hancock) of 2006 was
substantially similar to this bill although it applied to
all state elective offices. That AB 583 was heard in
this committee but was never brought up for a vote.
AB 2949 (Hancock) of 2004, proposed providing public funds
to candidates who collect a specified number of $5
contributions as the only funds those candidates may use
on their campaigns for state office, similar to this
bill. AB 2949 was held on the Assembly Appropriations
Committee's suspense file.
AB 1623 (Longville) of 2003, would have allowed individuals
to make political contributions through Freedom Drafts to
political candidates of their choice to be funded through
the state treasury. AB 1623 failed passage in Assembly
policy committee, and was amended to deal with a
different subject.
AB 190 (Longville) of 2001 and AB 2134 (Longville) of 2002,
proposed different methods to provide matching funds and
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public financing grants to legislative candidates who
agreed to abide by voluntary expenditure ceilings. AB
190 failed passage in Assembly policy committee, while AB
2134 was held on the Assembly Appropriations Committee's
suspense file.
SB 1169 (Bowen) of 1999, proposed providing matching funds
to legislative candidates who agreed to abide by
voluntary expenditure ceilings imposed by the bill. SB
1169 died on the Senate Floor without having been brought
up for a vote.
PRIOR ACTION
Assembly Elections and Redistricting Committee:5-2
Assembly Appropriations Committee:
12-5
Assembly Floor: 45-34
POSITIONS
Sponsor: California Clean Money Campaign
Support: California Church IMPACT
California National Organization for Women (CA
NOW)
California Nurses Association
CALPIRG
Common Cause
Consumer Federation of California
Consumer for Auto Reliability and Safety (CARS)
Equal Justice Society
Gray Panthers California
League of Women Voters of California (LWV)
Mexican America Legal Defense and Educational
Fund (MALDEF)
Planning and Conservation League
Secretary of State
Sierra Club California
William C. Velasquez Institute
Wild Dog Productions
Numerous Individuals
Oppose: California Family Council (CFC)
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Howard Jarvis Taxpayers Association
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