BILL NUMBER: AB 785 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 4, 2011
INTRODUCED BY Assembly Member Mendoza
FEBRUARY 17, 2011
An act to amend Section 1091.5 of, and to add Section
1091.7 to, the Government Code, relating to public officers.
An act to add Section 87100.2 to the Government Code,
relating to the Political Reform Act.
LEGISLATIVE COUNSEL'S DIGEST
AB 785, as amended, Mendoza. Public
Political Reform Act of 1974: public officers: contracts:
financial interest.
(1) Existing law prohibits Members of the Legislature, and state,
county, district, judicial district, and city officers or employees
from being financially interested in a contract, as specified, made
by them in their official capacity or by any body or board of which
they are members, subject to specified exceptions.
This bill would provide, notwithstanding any other provision of
law, that a public officer who is an elected member of any state or
local body, board, or commission shall be deemed to have a financial
interest in a contract pursuant to these provisions, if that officer'
s spouse, or child, parent, or sibling, or the spouse of the child,
parent, or sibling, has a financial interest in any contract made by
that public officer in his or her official capacity, or by any body,
board, or commission of which that public officer is a member.
(2) Existing law provides for a criminal penalty on every officer
or person prohibited by state laws from making or being interested in
contracts, who willfully violates any of the provisions of those
laws.
By creating a new crime pursuant to these provisions, this bill
would impose a state-mandated local program.
(1) The Political Reform Act of 1974 prohibits a public official
at any level of state or local government from making, participating
in making, or in any way attempting to use his or her official
position to influence a governmental decision in which he or she
knows or has reason to know he or she has a financial interest. A
violation of the Political Reform Act of 1974 is subject to
administrative, civil, and criminal penalties.
This bill would provide, for purposes of this prohibition, that a
public official who is an elected or appointed member of any state or
local body, board, or commission has a financial interest in a
decision if an immediate family member of the public official has a
financial interest in the decision, and would include a person
lobbying on behalf of a party that has an order of business before
the body, board, or commission to be an agent of that party. This
bill would define "immediate family member" to include public
official's spouse or domestic partner, children, parents, siblings,
and the spouse or domestic partner of a child, parent, or sibling.
This bill would impose a state-mandated local program by exposing
these public officials to potential criminal penalties for failing to
recuse themselves from participation where required by this bill.
(3)
(2) The California Constitution requires the state to
reimburse local agencies and school districts for certain costs
mandated by the state. Statutory provisions establish procedures for
making that reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
(3) The Political Reform Act of 1974, an initiative measure,
provides that the Legislature may amend the act to further the act's
purposes upon a 2/3 vote of each house and compliance with specified
procedural requirements.
This bill would declare that it furthers the purposes of the act.
Vote: majority 2/3 . Appropriation:
no. Fiscal committee: yes. State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 87100.2 is added to the
Government Code , to read:
87100.2. (a) A public official who is an elected or appointed
member of any state or local body, board, or commission has a
financial interest in a decision within the meaning of Section 87100
if an immediate family member of the public official has a financial
interest in the decision.
(b) For purposes of determining a financial interest pursuant to
this section, a person lobbying on behalf of a party that has an
order of business before the body, board, or commission shall be
construed to be an agent of that party, and, as the lobbyist, have a
financial interest in that order of business.
(c) For purposes of this section, "immediate family member"
includes a spouse or domestic partner, children, parents, siblings,
and the spouse or domestic partner of a child, parent, or sibling.
SEC. 2. No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.
SEC. 3. The Legislature finds and declares that
this bill furthers the purposes of the Political Reform Act of 1974
within the meaning of subdivision (a) of Section 81012 of the
Government Code.
SECTION 1. Section 1091.5 of the Government
Code is amended to read:
1091.5. (a) An officer or employee shall not be deemed to be
interested in a contract if his or her interest is any of the
following:
(1) The ownership of less than 3 percent of the shares of a
corporation for profit, provided that the total annual income to him
or her from dividends, including the value of stock dividends, from
the corporation does not exceed 5 percent of his or her total annual
income, and any other payments made to him or her by the corporation
do not exceed 5 percent of his or her total annual income.
(2) That of an officer in being reimbursed for his or her actual
and necessary expenses incurred in the performance of official
duties.
(3) That of a recipient of public services generally provided by
the public body or board of which he or she is a member, on the same
terms and conditions as if he or she were not a member of the body or
board.
(4) That of a landlord or tenant of the contracting party if the
contracting party is the federal government or any federal department
or agency, this state or an adjoining state, any department or
agency of this state or an adjoining state, any county or city of
this state or an adjoining state, or any public corporation or
special, judicial, or other public district of this state or an
adjoining state unless the subject matter of the contract is the
property in which the officer or employee has the interest as
landlord or tenant in which event his or her interest shall be deemed
a remote interest within the meaning of, and subject to, the
provisions of Section 1091.
(5) That of a tenant in a public housing authority created
pursuant to Part 2 (commencing with Section 34200) of Division 24 of
the Health and Safety Code in which he or she serves as a member of
the board of commissioners of the authority or of a community
development commission created pursuant to Part 1.7 (commencing with
Section 34100) of Division 24 of the Health and Safety Code.
(6) Except as provided in Section 1091.7, that of a spouse of an
officer or employee of a public agency in his or her spouse's
employment or officeholding if his or her spouse's employment or
officeholding has existed for at least one year prior to his or her
election or appointment.
(7) That of a nonsalaried member of a nonprofit corporation,
provided that this interest is disclosed to the body or board at the
time of the first consideration of the contract, and provided further
that this interest is noted in its official records.
(8) That of a noncompensated officer of a nonprofit, tax-exempt
corporation, which, as one of its primary purposes, supports the
functions of the body or board or to which the body or board has a
legal obligation to give particular consideration, and provided
further that this interest is noted in its official records.
For purposes of this paragraph, an officer is "noncompensated"
even though he or she receives reimbursement from the nonprofit,
tax-exempt corporation for necessary travel and other actual expenses
incurred in performing the duties of his or her office.
(9) That of a person receiving salary, per diem, or reimbursement
for expenses from a government entity, unless the contract directly
involves the department of the government entity that employs the
officer or employee, provided that the interest is disclosed to the
body or board at the time of consideration of the contract, and
provided further that the interest is noted in its official record.
(10) That of an attorney of the contracting party or that of an
owner, officer, employee, or agent of a firm which renders, or has
rendered, service to the contracting party in the capacity of
stockbroker, insurance agent, insurance broker, real estate agent, or
real estate broker, if these individuals have not received and will
not receive remuneration, consideration, or a commission as a result
of the contract and if these individuals have an ownership interest
of less than 10 percent in the law practice or firm, stock brokerage
firm, insurance firm, or real estate firm.
(11) Except as provided in subdivision (b), that of an officer or
employee of, or a person having less than a 10-percent ownership
interest in, a bank, bank holding company, or savings and loan
association with which a party to the contract has a relationship of
borrower, depositor, debtor, or creditor.
(12) That of (A) a bona fide nonprofit, tax-exempt corporation
having among its primary purposes the conservation, preservation, or
restoration of park and natural lands or historical resources for
public benefit, which corporation enters into an agreement with a
public agency to provide services related to park and natural lands
or historical resources and which services are found by the public
agency, prior to entering into the agreement or as part of the
agreement, to be necessary to the public interest to plan for,
acquire, protect, conserve, improve, or restore park and natural
lands or historical resources for public purposes and (B) any
officer, director, or employee acting pursuant to the agreement on
behalf of the nonprofit corporation. For purposes of this paragraph,
"agreement" includes contracts and grants, and "park," "natural
lands," and "historical resources" shall have the meanings set forth
in subdivisions (d), (g), and (i) of Section 5902 of the Public
Resources Code. Services to be provided to the public agency may
include those studies and related services, acquisitions of property
and property interests, and any activities related to those studies
and acquisitions necessary for the conservation, preservation,
improvement, or restoration of park and natural lands or historical
resources.
(13) That of an officer, employee, or member of the Board of
Directors of the California Housing Finance Agency with respect to a
loan product or programs if the officer, employee, or member
participated in the planning, discussions, development, or approval
of the loan product or program and both of the following two
conditions exist:
(A) The loan product or program is or may be originated by any
lender approved by the agency.
(B) The loan product or program is generally available to
qualifying borrowers on terms and conditions that are substantially
the same for all qualifying borrowers at the time the loan is made.
(b) An officer or employee shall not be deemed to be interested in
a contract made pursuant to competitive bidding under a procedure
established by law if his or her sole interest is that of an officer,
director, or employee of a bank or savings and loan association with
which a party to the contract has the relationship of borrower or
depositor, debtor or creditor.
SEC. 2. Section 1091.7 is added to the
Government Code, to read:
1091.7. (a) Notwithstanding any other provision of law, a public
officer who is an elected member of any state or local body, board,
or commission shall be deemed to have a financial interest in a
contract pursuant to this article, if that officer's spouse, or
child, parent, or sibling, or the spouse of the child, parent, or
sibling, has a financial interest in any contract made by that public
officer in his or her official capacity, or by any body, board, or
commission of which that officer is a member.
(b) (1) The determination of a financial interest with respect to
any person described in this section shall be made according to the
same standards as those set forth in this article with respect to the
public officer, as applicable.
(2) For purposes of determining a financial interest pursuant to
this section, an individual lobbying on behalf of a contracting party
shall be construed to be an agent of that contracting party.
SEC. 3. No reimbursement is required by this
act pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.