BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 1648
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          Date of Hearing:   March 27, 2012

                  ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING
                                  Paul Fong, Chair
                AB 1648 (Brownley) - As Introduced:  February 13, 2012
           
          SUBJECT  :   Political Reform Act of 1974: advertisements: 
          disclosure.

           SUMMARY  :   Makes significant changes to required disclosures on 
          campaign advertisements and slate mailers.  Specifically,  this 
          bill  :  

          1)Defines the following terms, for the purposes of this bill:

             a)   "Advertisement" to mean any general or public 
               advertisement which is authorized and paid for by a person 
               or committee for the purpose of supporting or opposing a 
               candidate for elective office or a ballot measure or 
               measures.  Provides that the term "advertisement" does not 
               include a communication from an organization other than a 
               political party to its members, a campaign button smaller 
               than 10 inches in diameter, a bumper sticker smaller than 
               60 square inches, or any other advertisement as determined 
               by the Fair Political Practices Commission (FPPC).

             b)   "Committee disclosure Internet Web site" to mean the 
               Internet Web site for a committee identifying the top 
               identifiable contributors to that committee.

             c)   "Cumulative contributions" to mean the cumulative amount 
               of contributions received by a committee beginning 18 
               months prior to the date the committee made its first 
               expenditure to qualify, support, or oppose a candidate for 
               elective office or a ballot measure or measures and ending 
               seven days before the advertisement is sent to the printer 
               or broadcast station or uploaded to the Internet.

             d)   "Identifiable contributor" to mean a person or committee 
               that has made cumulative contributions of at least $10,000 
               to a committee.

          2)Requires a radio advertisement that supports or opposes a 
            candidate or ballot measure or solicits contributions in 
            support of that purpose, to include the following:







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             a)   If the advertisement is authorized by a candidate or an 
               agent of the candidate, an audio statement in which the 
               candidate identifies himself or herself and states that the 
               candidate has approved the message; or,

             b)   If the advertisement is not authorized by a candidate or 
               agent of a candidate, a disclosure at the end of the ad 
               read in a clearly spoken manner in a pitch and tone 
               substantially similar to the rest of the advertisement that 
               reads as follows:

             "Top funders of this ad are Ýnames in descending order of 
               identifiable contributors who made the three largest 
               cumulative contributions to the committee that paid for the 
               advertisement].  Full funding details at ÝInternet Web site 
               address of the committee disclosure Internet Web site]."

          3)Requires a television or video advertisement that supports or 
            opposes a candidate or ballot measure or solicits 
            contributions in support of that purpose, to include the 
            following:

             a)   If the advertisement is authorized by a candidate or an 
               agent of the candidate, a statement in which the candidate 
               identifies himself or herself and states that the candidate 
               has approved the message; or,

             b)   If the advertisement is not authorized by a candidate or 
               agent of a candidate, a full-screen disclosure without 
               audio on black background for a minimum of three seconds 
               that includes all of the following:

               i)     The text "Top Funders for This Ad" located on the 
                 top of the screen and centered horizontally.  Requires 
                 the text to be white in color and the font size to be at 
                 least 5 percent of the height of the screen.

               ii)    Immediately below the text detailed above, the 
                 logos, if any, as they appear on the Internet Web site 
                 homepage of the identifiable contributor, for the 
                 identifiable contributors who have made the three largest 
                 cumulative contributions to the committee that paid for 
                 the advertisement.  Requires each logo to occupy at least 
                 15 percent of the width or height of the screen, and to 







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                 be displayed from left to right in descending order 
                 beginning with the largest identifiable contributor.

               iii)   Immediately below the logos, if any, the names of 
                 the identifiable contributors who made the three largest 
                 cumulative contributions to the committee that paid for 
                 the advertisement.  Requires each contributor to be 
                 disclosed on a separate vertical line, in descending 
                 order, beginning with the identifiable contributor who 
                 made the largest cumulative contribution on the first 
                 line.  Requires the names of the identifiable 
                 contributors to be centered horizontally, the text to be 
                 white in color, and the font size to be at least 5 
                 percent of the height of the screen.

               iv)    The text "Full Funding Details At ÝInternet Web site 
                 address of the committee disclosure Internet Web site]."  
                 Requires the text to be white in color, the font size to 
                 be equivalent to 4 percent of the height of the screen, 
                 and to be located in a position that is vertically 4 
                 percent above the bottom of the screen.

          4)Requires a mass mailing or print advertisement, other than a 
            slate mailer or an advertisement that is authorized by a 
            candidate or an agent of a candidate, that supports or opposes 
            a candidate or ballot measure or solicits contributions in 
            support of that purpose, and that is paid for by a committee 
            or by any person who is not a committee but who spends over 
            $1,000 on mass mailing or print advertising cumulatively in 
            the period beginning 18 months prior to the date the person 
            made his or her first expenditure to qualify, support, or 
            oppose the candidate or measure and ending seven days before 
            the mailing or advertisement is sent to the printer, to 
            include a disclosure area on the largest page of the mass 
            mailing or print advertisement that meets all of the following 
            criteria:

             a)   Requires the disclosure area to be set apart from the 
               rest of the page on which it is located by a line framing 
               the disclosure area in the shape of a square or rectangle 
               and in a color that is darker than the background color of 
               the remainder of the disclosure area.  Requires the 
               disclosure area within the border line to have a solid 
               background color that establishes a contrast to the color 
               of the disclosure text that is equivalent to or greater 







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               than the text and background color contrast in other areas 
               of the mass mailing or print advertisement.

             b)   In the case of a mass mailing or print advertisement 
               that is paid for by a committee, requires the disclosure to 
               contain all of the following:

               i)     The text "Top Funders for This Ad" located at the 
                 top of the disclosure area and centered horizontally in 
                 the disclosure area.  Requires the text to be in a font 
                 size of at least 14-point for pages smaller than 8.5 
                 inches by 11 inches and at least 16-point for pages that 
                 are equal to or larger than 8.5 inches by 11 inches. 

               ii)    Immediately below the text detailed above, the 
                 logos, if any, as they appear on the Internet Web site 
                 homepage of the identifiable contributor, for the 
                 identifiable contributors who have made the three largest 
                 cumulative contributions to the committee that paid for 
                 the advertisement.  Requires each logo to occupy at least 
                 8 percent of the width or height of the page on which the 
                 disclosure area is located, and to be displayed from left 
                 to right in descending order beginning with the largest 
                 identifiable contributor.

               iii)   Immediately below the logos, if any, the names of 
                 the identifiable contributors who made the three largest 
                 cumulative contributions to the committee that paid for 
                 the advertisement.  Requires each contributor to be 
                 disclosed on a separate vertical line, in descending 
                 order, beginning with the identifiable contributor who 
                 made the largest cumulative contribution on the first 
                 line.  Requires the names of the identifiable 
                 contributors to be centered horizontally, and requires 
                 the text to be in a font size of at least 10-point for 
                 pages smaller than 8.5 inches by 11 inches and at least 
                 12-point for pages that are equal to or larger than 8.5 
                 inches by 11 inches.

               iv)    The text "Full Funding Details At ÝInternet Web site 
                 address of the committee disclosure Internet Web site]."  
                 Requires the text to be located at the bottom of the 
                 disclosure area, and to be in a font size of at least 
                 10-point for pages smaller than 8.5 inches by 11 inches 
                 and at least 12-point for pages that are equal to or 







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                 larger than 8.5 inches by 11 inches.

             c)   In the case of a mass mailing or print advertisement 
               that is paid for by a person who is not a committee, 
               requires the disclosure to include the text "This 
               advertisement funded by Ýname of the person who paid for 
               the mass mailing or print advertisement]."  Requires the 
               text to be centered within the disclosure area, and to be 
               in a font size of at least 14-point for pages smaller than 
               8.5 inches by 11 inches and at least 16-point for pages 
               that are equal to or larger than 8.5 inches by 11 inches.

          5)Requires a committee that pays for an advertisement for which 
            a disclaimer would have to be included under this bill to 
            establish and maintain a committee disclosure Internet Web 
            site.  Provides that if the committee has an Internet Web site 
            home page, that Internet Web site may also serve as the 
            committee disclosure site.  Requires the committee disclosure 
            Internet Web site and any other Web sites maintained by the 
            committee to include a disclosure statement area that complies 
            with all of the following:

             a)   The disclosure statement area is at least 250 pixels 
               wide, with a white background and a border that is dark in 
               color.

             b)   A title that reads "Top Funders of This Committee" in 
               black text of at least 10-point font size.

             c)   Immediately below the text identified above, the names 
               of the identifiable contributors who made the ten largest 
               cumulative contributions to the committee that paid for the 
               advertisement.  Requires each contributor to be disclosed 
               on a separate vertical line, in descending order, beginning 
               with the identifiable contributor who made the largest 
               cumulative contribution on the first line.  Requires the 
               text to be black in color, and the font size to be at least 
               9-point.

             d)   Immediately below the text detailed above, the logos, if 
               any, as they appear on the Internet Web site homepage of 
               the identifiable contributor, for the identifiable 
               contributors who have made the ten largest cumulative 
               contributions to the committee.  Requires each logo to 
               occupy at least 75 horizontal or vertical pixels, and to be 







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               displayed from left to right in descending order beginning 
               with the largest identifiable contributor.

             e)   A link to the Internet Web site maintained by the 
               Secretary of State that contains campaign finance 
               disclosures made by the committee pursuant to existing law. 
                Requires the link to be labeled "Full Funding info at the 
               Secretary of State's Internet Web site."  Requires the link 
               to be a standard hyperlink that is displayed as blue 
               underlined text in Arial equivalent font in at least 
               9-point size.

          6)Requires, if an entity that is disclosed as an identifiable 
            contributor pursuant to this bill is an individual, that the 
            disclosure of that individual also include the occupation and 
            employer of the contributor in addition to the contributor's 
            name if the committee receiving the contribution is supporting 
            or opposing a candidate.

          7)Requires, if an entity that is disclosed as an identifiable 
            contributor pursuant to this bill is an individual, that the 
            disclosure of that individual also include the occupation and 
            employer of the contributor in addition to the contributor's 
            name if the committee receiving the contribution is supporting 
            or opposing a ballot measure and the passage or defeat of the 
            ballot measure directly benefits or harms the employer of the 
            identifiable contributor.  Provides that if an employer of an 
            identifiable contributor is also an identifiable contributor, 
            that the contributions of the employee shall be deemed to be 
            contributions by the employer for the purposes of determining 
            the total cumulative contributions made by the employer in 
            order to determine which identifiable contributors are 
            disclosed.

          8)Provides that if a committee does not have any identifiable 
            contributors, as defined by the bill, the name of that 
            committee shall be included in the advertisement in the place 
            of the identifiable contributors if the committee has received 
            cumulative contributions of at least $10,000.

          9)Requires a slate mailer to include an asterisk (*) next to 
            each candidate and ballot measure if the appearance of that 
            candidate or ballot measure in the slate mailer has been paid 
            for.








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          10)Repeals a requirement that an advertisement for or against a 
            ballot measure include a disclosure statement identifying the 
            two highest cumulative contributors of $50,000 or more to the 
            committee funding the advertisement.  Repeals a requirement 
            that a broadcast or mass mailing advertisement supporting or 
            opposing a candidate or ballot measure that is paid for by an 
            independent expenditure (IE) must include a disclosure 
            statement identifying the name of the committee making the 
            expenditure and the names of the persons from whom the 
            committee making the IE received its two highest cumulative 
            contributions of $50,000 or more during the 12-month period 
            prior to the expenditure.  Repeals a requirement that an 
            advertisement supporting or opposing a candidate that is paid 
            for by an IE must include a statement that it was not 
            authorized by a candidate or a committee controlled by a 
            candidate.

           EXISTING LAW  :

          1)Requires an advertisement for or against any ballot measure to 
            include a disclosure statement identifying any person whose 
            cumulative contributions are $50,000 or more.  Provides that 
            if there are more than two donors of $50,000 or more, the 
            disclosure only needs to include the highest and second 
            highest donors in that order.

          2)Requires a committee that supports or opposes one or more 
            ballot measures to name itself using a name or phrase that 
            identifies the economic or other special interest of its major 
            donors of $50,000 or more.  Provides that if the major donors 
            of $50,000 or more share a common employer, the identity of 
            the employer must also be disclosed.

          3)Requires a broadcast or mass mailing advertisement supporting 
            or opposing a candidate or ballot measure that is paid for by 
            an IE to include a disclosure statement identifying the name 
            of the committee making the expenditure and the names of the 
            persons from whom the committee making the IE received its two 
            highest cumulative contributions of $50,000 or more during the 
            12-month period prior to the expenditure.

          4)Provides that when a disclosure of the top two donors is 
            required on an advertisement pursuant to either of the above 
            provisions, only the largest donor needs to be disclosed on an 
            advertisement that is an electronic broadcast of 15 seconds or 







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            less or a print advertisement of 20 square inches or less.
           
          FISCAL EFFECT  :  Unknown. State-mandated local program; contains 
          a crimes and infractions disclaimer.

           COMMENTS  :

           1)Purpose of the Bill  :  According to the author:

               Campaign spending has reached unprecedented levels in 
               recent years.  Over $200 million was spent on ballot 
               measures alone during the November 2010 election in 
               California, and even greater amounts of spending are 
               expected for this upcoming election cycle.  Although 
               there are limits on the amount of direct contributions 
               candidates can receive, funders can make unlimited 
               contributions to candidates through independent 
               expenditure committees and to ballot measure 
               committees that have significantly shaped the way 
               California is governed.  Furthermore, many of these 
               committees are purposely established to disguise who 
               exactly is funding the campaign messages that voters 
               see and hear, hiding behind vague names such as 
               "Californians for Progress."  As a result, it is no 
               surprise that an October 2011 Field Poll found that 
               Californians believe reforms must be made to weaken 
               the influence special interests have asserted over 
               direct democracy intended to empower the average 
               citizen:  84% of all voters, across political 
               ideology, want public disclosure requirements of 
               initiative sponsors to more clearly identify who are 
               its major funders.   

               While it is essential in a democracy for individuals 
               and organizations to be able to communicate 
               effectively and efficiently with voters, it is equally 
               important that voters are not intentionally deceived 
               and elections are not decided upon misinformation.  AB 
               1148 will help cast light on spending in elections by 
               requiring the disclosure of top funding sources 
               directly on all mediums of political advertisements, 
               and requiring campaign committees to maintain a 
               website with a list of its largest funders so voters 
               are able to easily access this important information 
               at all times.  At a time when public confidence in its 







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               elected officials is unequivocally low, strengthening 
               disclosure requirements on political advertisements is 
               necessary to help Californians be better informed and 
               feel more represented by their government.

           2)Constitutional Issues  :  This measure could be interpreted as a 
            violation of the United States and California Constitutions' 
            guarantees to free speech.  While the right to freedom of 
            speech is not absolute, when a law burdens core political 
            speech, the restrictions on speech generally must be "narrowly 
            tailored to serve an overriding state interest,"  McIntyre v. 
            Ohio Elections Commission  (1995), 514 US 334.

          In  Talley v. California  (1960), 362 US 60, the United States 
            Supreme Court struck down a Los Angeles City ordinance that 
            required any handbill that was distributed in the city to 
            contain the name and address of the person who printed, wrote, 
            compiled, or manufactured the handbill.  The Court found the 
            ordinance to be void on its face, because it believed that the 
            ordinance would restrict freedom of expression, in violation 
            of the First Amendment to the United States Constitution.  In 
            its opinion, the Court wrote that there could be "no doubt" 
            that the Los Angeles ordinance requiring disclosure on a 
            handbill "would tend to restrict the freedom to distribute 
            information and thereby freedom of expression."  The court 
            continued to note that "Ýa]nonymous pamphlets, leaflets, 
            brochures and even books have played an important role in the 
            progress of mankind.  Persecuted groups and sects from time to 
            time throughout history have been able to criticize oppressive 
            practices and laws either anonymously or not at all.  The 
            obnoxious press licensing law of England, which was also 
            enforced on the Colonies was due in part to the knowledge that 
            exposure of the names of printers, writers, and distributors 
            would lessen the circulation of literature critical of the 
            government. . . . Even the Federalist Papers, written in favor 
            of the adoption of our Constitution, were published under 
            fictitious names.  It is plain that anonymity has sometimes 
            been assumed for the most constructive purposes."

          Building on its holding in  Talley  , the Court more recently 
            considered, in  McIntyre  , an Ohio law that prohibited the 
            distribution of campaign literature that did not contain the 
            name and address of the person or campaign official issuing 
            the literature.  The United States Supreme Court, in reviewing 
            the case, found that the Ohio law unconstitutionally 







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            restricted the freedom of speech in violation of the First 
            Amendment to the United States Constitution.  In attempting to 
            justify the Ohio law in light of the Court's decision in 
             Talley  , the Ohio Elections Commission argued that the two laws 
            were distinguishable because the Ohio law applied only to 
            documents designed to influence voters in an election, whereas 
            the law in question in  Talley  applied to all handbills.  While 
            the Court recognized that the two laws were different in this 
                 respect, it nonetheless found that "the category of speech 
            regulated by the Ohio statute occupies the core of the 
            protection offered by the First Amendment," and concluded that 
            "the speech in which Mrs. McIntyre engaged - handing out 
            leaflets in the advocacy of a politically controversial 
            viewpoint - is the essence of First Amendment expression."

          Nonetheless, the State of Ohio argued that even under the 
            strictest standard of review, the statute should have been 
            upheld in recognition of two important state 
            interests-preventing fraudulent and libelous statements, and 
            providing the electorate with relevant information.  The Court 
            found that neither interest was sufficient to justify the 
            restrictions that the Ohio law imposed on the freedom of 
            expression.

          With respect to the interest in preventing fraudulent and 
            libelous statements, the court noted that Ohio already had 
            prohibitions against making or disseminating false statements 
            during political campaigns, and as such, "Ohio's prohibition 
            of anonymous leaflets plainly is not its principal weapon 
            against fraud."  The second state interest offered by Ohio was 
            the interest of "providing the electorate with relevant 
            information" - an interest that is similar to the author's 
            stated reason for seeking to require disclosure on 
            advertisements as required by this bill.  Here too, however, 
            the  McIntyre  court found that such an interest was not 
            sufficient to justify the restrictions that the Ohio statute 
            placed on freedom of speech and expression, stating that 
            "Ýi]nsofar as the interest in informing the electorate means 
            nothing more than the provision of additional information that 
            may either buttress or undermine the argument in a document, 
            we think the identity of the speaker is no different from 
            other components of the document's content that the author is 
            free to include or exclude. . . . The simple interest in 
            providing voters with additional relevant information does not 
            justify a state requirement that a writer make statements or 







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            disclosures she would otherwise omit."

          Finally, the  McIntyre  court made an important distinction 
            between a requirement that a person file a report with a 
            government agency to disclose money expended for a campaign 
            advertisement and a requirement that a person must disclose 
            his or her identity on the advertisement itself, noting that 
            while requiring a report to be filed with a government agency 
            "undeniably impedes protected First Amendment activity, the 
            intrusion is a far cry from compelled self-identification on 
            all election-related writings."  The court continued, "Ýa] 
            written election-related document-particularly a leaflet-is 
            often a personally crafted statement of a political viewpoint. 
            . . . As such, identification of the author against her will 
            is particularly intrusive; it reveals unmistakably the content 
            of her thoughts on a controversial issue. Disclosure of an 
            expenditure and its use, without more, reveals far less 
            information. It may be information that a person prefers to 
            keep secret, and undoubtedly it often gives away something 
            about the spender's political views. Nonetheless, even though 
            money may 'talk,' its speech is less specific, less personal, 
            and less provocative than a handbill - and as a result, when 
            money supports an unpopular viewpoint it is less likely to 
            precipitate retaliation."

          Subsequent to the  Talley  and  McIntyre  rulings, the Ninth Circuit 
            Court of Appeals has rejected arguments that the Supreme 
            Court's holdings in those two cases apply only to materials 
            created and distributed by individuals who are acting alone.  
            In  ACLU v. Heller  (2004), 378 F.3d 979, the Ninth Circuit 
            Court of Appeals struck down a Nevada law that required any 
            published material concerning a campaign to identify the 
            person paying for the publication.  In an effort to save the 
            law after the Supreme Court's decision in  McIntyre , Nevada 
            amended its law to include an exception for campaign materials 
            that were paid for by "a natural person who acts independently 
            and not in cooperation with or pursuant to any direction from 
            a business or social organization, nongovernmental legal 
            entity, or governmental entity."  The Court rejected the 
            state's argument that this amendment was sufficient to save 
            the statute in light of  McIntyre  .  In its decision, the Court 
            wrote, "Ýt]he Court in  McIntyre  did stress the particular 
            harshness of Ohio's punishment of McIntyre as the sole 
            advocate for her cause.  But nothing in the decision indicates 
            that if she had been allied with other individuals, or with a 







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            'business or social organization,' the result would have been 
            different.  The anonymity protected by  McIntyre  is not that of 
            a single cloak."  The Court continued to note that all of the 
            concerns that applied to an advertisement distributed or paid 
            for by an individual also applied to an advertisement that was 
            distributed or paid for by an organization.  Citing  McIntyre  , 
            the court wrote, "Ýs]imilarly, just as a lone 'advocate may 
            believe her ideas will be more persuasive if her readers are 
            unaware of her identity,' because readers may otherwise 
            'prejudge her message simply because they do not like its 
            proponent,' so, too, groups or individuals working in 
            cooperation with groups may be concerned about readers 
            prejudging the substance of a message by associating their 
            names with the message.  In fact, groups are more likely to be 
            associated with a certain viewpoint than are individuals 
            (e.g., Greenpeace, ACLU, the National Rifle Association).  So 
            a particular group's concern that its message may be prejudged 
            based on its association with the group could be even more 
            well-founded than an individual's similar concern.  Anonymity 
            may allow speakers to communicate their message when 
            preconceived prejudices concerning the message-bearer, if 
            identified, would alter the reader's receptiveness to the 
            substance of the message.  Like other choice-of-word and 
            format decisions, the presence or absence of information 
            identifying the speaker is no less a content choice for a 
            group or an individual cooperating with a group than it is for 
            an individual speaking alone" (Internal citations omitted).

          Supporters of this bill have argued that, notwithstanding the 
            decisions in the three cases discussed above, the provisions 
            of this bill nonetheless are constitutional, particularly in 
            light of disclosure requirements that were upheld by the 
            United States Supreme Court in  Citizens United v. Federal 
            Election Commission  (2010), 130 S.Ct. 876.  While the  Citizens 
            United  case is probably best known as the case in which the 
            United States Supreme Court struck down a 63 year old law that 
            prohibited corporations and unions from using their general 
            treasury funds to make independent expenditures in federal 
            elections, in the same case, the Court also upheld certain 
            disclaimer and disclosure provisions of the federal Bipartisan 
            Campaign Reform Act (BCRA) of 2002, also sometimes called 
            "McCain-Feingold" for its Senate authors.

          The  Citizens United  case involved a nonprofit corporation 
            (Citizens United) that sought to run television commercials 







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            promoting a film it produced that was critical of then-Senator 
            and presidential candidate Hillary Clinton.  Because federal 
            law prohibited corporations and unions from using their 
            general treasury funds to make expenditures for 
            "electioneering communications" or for communications that 
            expressly advocated the election or defeat of a candidate, 
            Citizens United was concerned that the television commercials 
            promoting its film could subject the corporation to criminal 
            and civil penalties.  Under BCRA, the film produced by 
            Citizens United and the television commercials promoting that 
            movie were subject to certain disclaimer and disclosure 
            requirements-specifically, a requirement that televised 
            electioneering communications must include a disclaimer 
            indicating the name of the person or organization that was 
            "responsible for the content" of the advertising.  
            Additionally, each communication was required to include a 
            statement that the communication was "not authorized by any 
            candidate or candidate's committee," and was required to 
            display the name and address of the person or group that 
            funded the advertisement.  Finally, under a different 
            provision of BCRA, any person who spent more than $10,000 in a 
            calendar year is required to file a disclosure statement with 
            the Federal Elections Commission (FEC) identifying the person 
            making the expenditure, the amount of the expenditure, the 
            election to which the communication was directed, and the 
            names of contributors in certain circumstances.

          Citizens United (the corporation) challenged these disclaimer 
            and disclosure requirements as applied to the film and the 
            television advertisements promoting that film.  Specifically, 
            Citizens United argued that the disclaimer and disclosure 
            requirements were unconstitutional on the grounds the 
            governmental interest in providing information to the 
            electorate did not justify requiring disclaimers for 
            commercial advertisements.  The court disagreed, finding that 
            the disclaimers provided the electorate with important 
            information, helping to ensure that voters were informed, and 
            "avoidÝed] confusion by making clear that the ads are not 
            funded by a candidate or political party."

          While some of the requirements of this bill are comparable to 
            provisions of federal law that were at issue in  Citizens 
            United  (for instance, certain disclaimer requirements included 
            in this bill are very similar to those required under federal 
            law that were upheld by the court in  Citizens United  ), other 







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            requirements in this bill go beyond what is required by 
            federal law, and beyond what was considered by the court in 
             Citizens United  .  Specifically, the provisions of this bill 
            that require the identities of certain campaign 
            contributors-entities that were not individually responsible 
            for the content or the production of the advertising-to be 
            included in campaign advertising go beyond what is required by 
            federal law.  In light of that fact, while the court in 
             Citizens United  did uphold certain federal disclaimer 
            requirements, it is unclear whether the broader requirements 
            in this bill would similarly be upheld against a 
            constitutional challenge on the grounds that those 
            requirements violate the First Amendment.  It is also 
            possible, however, that the disclaimers and disclosures that 
            are required under existing state law could be susceptible to 
            challenge as well on the same grounds.  
           
           3)Third Party Payment for Slate Mailer Placement  :  Under 
            existing law, a slate mailer must have an asterisk next to a 
            ballot measure or candidate that appears in the slate mailer 
            if that candidate or ballot measure has paid to appear in the 
            slate mailer.  However, if someone other than the candidate or 
            ballot measure committee pays to include a candidate or ballot 
            measure committee in the slate mailer, no asterisk or other 
            designation is included in the mailer.  So, for instance, if a 
            general purpose committee makes an independent expenditure by 
            paying a slate mailer to include a candidate that the general 
            purpose committee has endorsed, the slate mailer itself would 
            have no indication that the appearance of that candidate was 
            paid for by the general purpose committee.

          This bill would require a slate mailer to include an asterisk 
            next to a candidate or ballot measure if a payment was made to 
            the publisher of that slate mailer for the appearance of that 
            candidate or measure, regardless of whether the payment was 
            made by the candidate or ballot measure committee or by a 
            third party.  
           
           4)Arguments in Support  :  The sponsor of this bill, the 
            California Clean Money Campaign, writes:

               Full and complete disclosure in political advertising 
               is needed now more than ever. The Supreme Court's 5-4 
               Citizens United v. FEC decision unleashed the 
               floodgates of anonymous spending on campaigns by 







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               ruling there could be no limits on outside spending by 
               corporations, unions, or individuals. At the same 
               time, the Court in Citizens United specifically noted 
               the problems that result when groups run ads "while 
               hiding behind dubious and misleading names". Over $235 
               million was spent on California ballot measures in 
               2010 alone, almost all of it by veiled actors hiding 
               behind innocuous sounding names that hide their real 
               funders.

               AB 1648 addresses these problems by requiring the 
               three largest funders of political ads to be clearly 
               identified with their names and logos on the ads 
               themselves, so voters know who is actually paying for 
               them. It applies to all television ads, radio ads, 
               print ads, mass mailers, and websites for or against 
               state and local ballot measures, and to independent 
               expenditures for and against candidates. It applies 
               whether ads are paid for by corporations, unions, 
               millionaires, or anybody else.

               AB 1648 is constitutional and reasonable. It in fact 
               reduces the time required for disclosure in typical 
               radio ads from 10-14 seconds in many cases under 
               current law down to only 6-7 seconds in most cases, 
               while at the same time being far clearer about who is 
               actually paying for the ads. Required disclosure for 
               television ads is only 3 seconds, enough to clearly 
               get across to the viewers who the top three funders of 
               the ad are, without imposing an undue burden on 
               political advertisers.

           5)Arguments in Opposition  :  In opposition to this bill, the 
            California Chamber of Commerce writes:
           
                At a time when California voters have no higher 
               priority than jobs, this bill is bad public policy. 
               California employers have a track record of supporting 
               those candidates who will help bring more jobs to our 
               state. AB 1648 is clearly written with the goal of 
               curtailing the voice of employers and their 
               participation in the election process. Without 
               business community participation in the election 
               process, voters will have less access to vital 
               information about where candidates stand on job 







                                                                  AB 1648
                                                                  Page  16

               creation and the elements needed for our state to 
               begin and sustain an economic recovery.

               Stifling any voice in an election is bad for 
               democracy. In these times, particularly, silencing the 
               voice of those who can help California recover so we 
               can fund essential and necessary programs like 
               education and health care is even more troublesome.

               Contrary to the proponent's assertion, campaign 
               disclosure information is already public and readily 
               available. This information is easily accessible on 
               the Secretary of State's website.

           6)Technical Issues  :  One provision of this bill specifies the 
            manner in which a disclaimer must appear on a television or 
            video advertisement that supports a candidate and that is 
            authorized by that candidate.  According to the author, this 
            requirement is intended to mirror a provision of federal law 
            that requires a candidate to include a statement in his or her 
            television advertisements indicating that he or she has 
            approved the communication.  However, as currently written, 
            this bill is actually somewhat broader than existing federal 
            law, which was not the intent of the author.  In order to make 
            the provisions of this bill consistent with what is required 
            under existing federal law, committee staff recommends the 
            following amendments:  On page 9, line 13, strike out 
            "candidate, alone," and insert: "candidate" and on page 9, 
            line 15, strike out "candidate, alone," and insert 
            "candidate." 

          Additionally, committee staff recommends the following amendment 
            to correct a typographical error in this bill:  On page 11, 
            line 9, strike out "Fenders" and insert "Funders."  
           
           7)Previous Legislation  :  This bill is substantially similar to 
            AB 1148 (Brownley) from the current Legislative session.  AB 
            1148 was approved by this committee by a 5-0 vote, but failed 
            passage on the Assembly Floor on a 52-26 vote.  Because AB 
            1148 was introduced in 2011 and failed to pass out of the 
            Assembly prior to January 31, 2012, it is no longer eligible 
            to be acted on by the Assembly pursuant to Article IV, Section 
            10 (c) of the California Constitution.   
           
           8)Political Reform Act of 1974  :  California voters passed an 







                                                                  AB 1648
                                                                  Page  17

            initiative, Proposition 9, in 1974 that created the FPPC and 
            codified significant restrictions and prohibitions on 
            candidates, officeholders and lobbyists. That initiative is 
            commonly known as the PRA.  Most amendments to the PRA that 
            are not submitted to the voters, including those contained in 
            this bill, must further the purposes of the initiative and 
            require a two-thirds vote of both houses of the Legislature.











































                                                                  AB 1648
                                                                  Page  18

           REGISTERED SUPPORT / OPPOSITION :   

           Support 
           
          California Clean Money Campaign (sponsor)
               In addition, the California Clean Money Campaign submitted 
               copies of petitions signed by approximately 750 individuals 
               in support of AB 1648
          California Alliance for Retired Americans
          California Church IMPACT
          California Common Cause
          California League of Conservation Voters
          California National Organization for Women
          California State Retirees
          CALPIRG
          City of Santa Monica
          City of Sunnyvale
          Consumer Federation of California
          Friends Committee on Legislation of California
          Green Chamber of Commerce
          Greenlining Institute
          JERICHO: A Voice for Justice
          League of Women Voters of California
          Lutheran Office of Public Policy - California
          MapLight
          Moms for Clean Air
          National Council of Jewish Women
          National Women's Political Caucus-Fresno County
          Planning and Conservation League
          Sierra Club California
          Southwest California Synod Evangelical Lutheran Church in 
          America

           Opposition 
           
          California Chamber of Commerce.  In its letter of opposition, 
          the California Chamber of Commerce indicated that the following 
          groups are also opposed to this bill:
               Air Conditioning Trade Association
               American Council of Engineering Companies of California
               Associated General Contractors
               Association of California Life and Health Insurance 
          Companies
               Bakersfield Chamber of Commerce
               California Apartment Association







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               California Broadcasters Association
               California Building Industry Association
               California Business Properties Association
               California Business Roundtable
               California Grocers Association
               California Manufacturers and Technology Association
               California Restaurant Association
               Chambers of Commerce Alliance of Ventura & Santa Barbara 
          Counties
               Long Beach Area Chamber of Commerce
               Palm Desert Area Chamber of Commerce
               Personal Insurance Federation of California
               Pharmaceutical Manufacturers Association
               Plumbing-Heating-Cooling Contractors Association of 
          California
               San Jose Silicon Valley Chamber of Commerce
               Western Electrical Contractors Association, Inc.
          Simi Valley Chamber of Commerce
          Southwest Riverside County Legislative Council
           
          Analysis Prepared by  :    Ethan Jones / E. & R. / (916) 319-2094