BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 8
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          Date of Hearing:   July 6, 2011

                   ASSEMBLY COMMITTEE ON GOVERNMENTAL ORGANIZATION
                                 Isadore Hall, Chair
                       SB 8 (Yee) - As Amended:  June 23, 2011

           SENATE VOTE  :   38-1
           
          SUBJECT  :   Public records: auxiliary organizations and UC campus 
          foundations.

           SUMMARY  :    Requires records maintained by an auxiliary 
          organization of the California State University (CSU), 
          California Community Colleges (CCC), and CCC districts and a 
          campus foundation of the University of California (UC) be 
          available to the public consistent with the California Public 
          Records Act (CPRA), excepting specified donor information.  
          Specifically,  this bill  :  

          1) Finds that CSU and CCC auxiliaries and UC foundations are 
          legally separate entities that are essential and integral to the 
          missions of CSU, CCC, and UC, respectively.

          2) Requires records, as defined, maintained by a CSU or CCC 
          auxiliary organization or UC campus foundation to be made 
          available to the public and requires the entities to follow 
          specified timelines and procedures for responding to public 
          records requests, consistent with CPRA. 

          3) Exempts from disclosure the following records maintained by a 
          CSU or CCC auxiliary or UC campus foundation:

                a)   Existing CPRA exemptions as set forth in Government 
          Code § 6254-6255,  inclusive;

                b)   Information that would disclose the identity of a 
          donor, prospective donor, or    volunteer;

                c)   Personal financial information and gift and estate 
          planning information of a       prospective donor or volunteer;

                d)   Personal information related to a donor's private 
          trusts or a donor's private annuities administered by an 
          auxiliary or campus foundation;









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                e)   Information related to fundraising plans, fundraising 
          research, and solicitation      strategies to the extent these 
          activities are not already protected under existing law, as      
                specified; and,

                f)   The identity of students and alumni to the extent 
          that this information is already      protected, excluding a 
          part-time or full-time employee of the auxiliary or campus      
          foundation or a student who participates in a legislative body 
          of a student body  organization, as defined.

          4) Stipulates that these provisions do not exempt disclosure of 
          the following information:

                a)   The amount and date of a donation;

                b)   Any donor-designated use or purpose of a donation and 
          any other donor-designated      restrictions on the use of a 
          donation;

                c)   The identity of a donor who, in any fiscal year, 
          makes a gift or gifts, in a quid pro  quo arrangement, where 
          either the value of the benefit received is greater than $2,500, 
                
                adjusted for inflation as specified, or the benefit would 
          be impermissible under existing       law; 

                d)   Self-dealing transactions as set forth in existing 
          law, as specified; and, 

                e)   Any instance in which a volunteer or donor of a gift 
          is awarded, within five years of      the date of the service or 
          gift, a contract from the auxiliary or campus foundation that   
          was not subject to competitive bidding.

          5)  States trade secrets, as defined shall not be subject to 
          disclosure. This information shall be redacted from auxiliary 
          organization records before disclosure.

          6) Authorizes proceedings for injunctive or declarative relief 
          to enforce the right to inspect or receive a copy of a record 
          maintained by an auxiliary or campus foundation, including the 
          awarding of attorney's fees, consistent with the authority 
          provided in CPRA.









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          7) Provides that when an auxiliary or campus foundation 
          discloses a record that is exempt from this bill, this 
          disclosure shall constitute a waiver for the exemptions 
          specified in this bill, excluding the following information:

                 a)  Disclosures made to a donor or prospective donor with 
               regard to that donor's donation or prospective donation to 
               an auxiliary organization;

                 b)  Disclosures made to a volunteer or prospective 
               volunteer with respect to that volunteer's services being 
               provided to the auxiliary organization;

                 c)  Disclosures made through other legal proceedings or 
               as otherwise required by law;

                 d)  Disclosures within the scope of a disclosure required 
               by law that limits disclosure of specified writings to 
               certain purposes;

                 e)  Disclosures to an auditor conducting an audit, as 
               defined; or

                 f)  Disclosures to a bank or similar financial 
               institution, as specified.

          8)  Provides that these provisions do not apply to any records 
          subject to a request made pursuant to CPRA.

          9) Defines a UC campus foundation as the following corporations 
          organized under the laws of the State of California: University 
          of California, Berkeley Foundation, UC Davis Foundation, The 
          University of California, Irvine Foundation, The UCLA 
          Foundation, University of California, Merced Foundation, UC 
          Riverside Foundation, UC San Diego Foundation, University of 
          California, San Francisco Foundation, UC Santa Barbara 
          Foundation, UC Santa Cruz Foundation, and any other foundation 
          authorized by the Regents of the University of California.
           
          EXISTING LAW  : 

          1)  The California Public Records Act (CPRA) governs the 
          disclosure of information collected and maintained by public 
          agencies.  Generally, all public records are accessible to the 
          public upon request, unless the record requested is exempt from 








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          public disclosure.  There are 30 general categories of documents 
          or information that are exempt from disclosure, essentially due 
          to the character of the information.  Unless it is shown that 
          the public's interest in disclosure outweighs the public's 
          interest in non-disclosure of the information, the exempt 
          information may be withheld by the public agency that has 
          custody of the information. 

          2)  Defines state agency, for purposes of the CPRA, to include 
          every state officer, department, division, bureau, board, and 
          commission or other state body or agency, except for the 
          Legislature and the Judiciary.  The California State University, 
          the University of California, and the California Community 
          Colleges are considered to be state agencies for this purpose. 

          3)  Authorizes the University of California, the California 
          State University, and the California Community Colleges to form 
          auxiliary organizations for the various purposes related to 
          their educational mission. 

           FISCAL EFFECT  :   Unknown.  This bill has been tagged non-fiscal 
          by Legislative Counsel.

           COMMENTS  :   

           Purpose of the bill  : According to the author, the public has 
          been unable to hold auxiliaries and foundations accountable for 
          their activities, yet these quasi-governmental entities provide 
          the same types of essential services to students and the public 
          that the colleges and universities provide.  Moreover, these 
          entities use public resources to perform their activities, e.g., 
          university office space, equipment, personnel, etc. 

           Auxiliaries and campus foundations  : CSU and CCC auxiliary 
          organizations and UC campus foundations are formed to further 
          the educational missions of their institutions.  Examples   
          include alumni groups, student associations, faculty 
          organizations, and groups that bear the name of the particular 
          college or university or campus.  These groups operate as 
          nonprofit public benefit corporations chartered under the 
          California Nonprofit Public Benefit Corporation Law and must 
          meet certain standards of operation such as: (1) auditing and 
          financial reporting procedures with oversight by a certified 
          public accountant; (2) expenditures that are in accordance with 
          policies delineated by the governing body; (3) meetings of 








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          boards and committees that are open to the public; and (4) 
          conformity of operational procedures with regulations 
          established by the governing body. 
                     
          UC auxiliaries differ from those at CSU and CCC; they engage in 
          commercial-type activities, such as parking operations and 
          certain athletics department operations, which are not separate, 
          independent entities.  As such, these "auxiliary enterprises" 
          are already subject to CPRA.

           Background  :  A 2001 court decision, CSU Fresno Association v. 
          Superior Court, found that CPRA applies only to state agencies 
          and would need to be specifically applied to campus auxiliary 
          organizations in statute.  In the past decade, there have been 
          numerous attempts to obtain records from CSU auxiliary 
          organizations that have been denied and several legislative      
          attempts to directly apply CPRA to auxiliaries and campus 
          foundations (SB 218, Yee, 2010 and SB 330, Yee, 2009) that 
          either died in the legislative process or were vetoed over 
          concerns about the appropriateness of subjecting private 
          organizations to CPRA and jeopardizing these entities' ability 
          to raise funds.

           New approach in 2011  :  SB 8 is the result of negotiations 
          between the author, the sponsors (the California Newspaper 
          Publishers Association and the California Faculty Association), 
          UC, CSU, and CCC.  This new approach does not subject 
          auxiliaries and campus foundations to CPRA; instead, this bill 
          recreates and applies CPRA provisions to these entities in the 
          Education Code.  This bill also exempts donor information unique 
          to these entities from disclosure, except under specified 
          circumstances.

           CPRA  :  CPRA presumes that all records held by government are 
          accessible to the public unless expressly made exempt from 
          disclosure.  It gives members of the public two main rights: the 
          right to inspect records free of charge and the right to obtain 
          a copy of records after paying for the direct costs of 
          duplication or a statutory fee.  The law gives agencies time 
          periods for responding to a request; once a request is made, the 
          agency must either produce the records in a reasonable amount of 
          time, as specified, or justify its decision to withhold the 
          record by showing that the record is exempt under an express 
          provision of law or that the public interest in disclosure of 
          the record is clearly outweighed by the public interest in 








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          nondisclosure.  There are 30 general categories of documents or 
          information that are exempt from disclosure, essentially due to 
          the character of the information.  CPRA allows a member of the 
          public to sue to enforce the law and provides that a prevailing 
          plaintiff can recover attorney fees and costs of bringing the    
               suit. 

           Donor exemptions  :  As noted above, UC and CSU opposed previous 
          legislation due to concerns about the possible "chilling effect" 
          on donor and volunteer contributions.  This bill exempts from    
               disclosure information that would disclose the identity of 
          a donor, prospective donor, or volunteer, except for the 
          following: 1)The amount and date of a donation; 2) Any 
          donor-designated use or purpose of a donation and any other 
          donor-designated restrictions on the use of a donation; 3) 
          Self-dealing transactions as set forth in existing law, as 
          specified; 4) Any instance in which a volunteer or donor of a 
          gift is awarded, within five years of the date of the service or 
          gift, a contract from the auxiliary or campus foundation that 
          was not subject to competitive bidding; and, 5) he identity of a 
          donor who, in any fiscal year, makes a gift or gifts, in a quid 
          pro quo arrangement, where either the value of the benefit 
          received is greater than $2,500, adjusted          for inflation 
          as specified, or the benefit would be impermissible under 
          existing law.  This provision is designed to exclude season 
          ticketholders for athletic events, who often must donate a 
          specified amount (usually $10,000 to $12,500) above the cost of 
          their tickets in order to receive preferred seats.  Since the 
          IRS values these contributions at 20% of the value of the 
          donation, $2,500 was selected to ensure that this bill did not 
          capture these donors who participate in           
          well-publicized fundraising campaigns. 

          SB 8 differs slightly from CPRA in that it adds information 
          supplied as part of an audit or to a financial institution to 
          the list of items that do not constitute a waiver from the 
          exemptions specified in this bill.

           In support  :  The University of California (UC) writes in 
          support, "this bill as amended, recognizes the need for donor 
          privacy and the unique role that UC Campus Foundations play in 
          supporting the educational, research, and public service mission 
          of the UC.  SB 8 now establishes a responsible process for 
          requests by the public that will be codified in the Education 
          Code, which UC believes is the appropriate location for 








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          provisions covering education related non-profit organizations.  
          While the bill is not perfect and may not include every 
          provision that we believe could avoid possibly unintended 
          consequences, we are satisfied that our Foundations can, in good 
          faith, adjust to the new provisions and continue to provide the 
          type of transparency that is appropriate without jeopardizing 
          donor privacy."

          The California State University (CSU) states, this bill contains 
          language which is critical to our ability to raise revenues and 
          not put us at a disadvantage with other nonprofits and private 
          colleges and universities.  This bill also maintains the state's 
          long-term commitment to protecting the personal privacy of 
          individuals, donors, volunteers, and vendor partnerships. 

           Prior legislation  :  SB 330 (Yee), 2009-2010 Legislative Session, 
          passed the Senate 22-10 and the Assembly 71-0 was vetoed by the 
          Governor.  Would have required auxiliary organizations of the 
          University of California (UC), the California State University 
          (CSU), and the California Community Colleges (CCC) to comply 
          with the CPRA except in specified instances.

          SB 218 (Yee) of 2009-2010 Legislative Session, passed the Senate 
          33-1 and the Assembly 76-0 was vetoed by the Governor.  This 
          bill would have included in the CPRA auxiliary organizations of 
          the University of California (UC), the California State 
          University (CSU), and the California Community Colleges (CCC), 
          except as specified.
           
          REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          Academic Professionals of California
          American Federation of State, County and Municipal Employees
          California Broadcasters Association
          California Faculty Association
          California Federation of Teachers
          California Newspaper Publishers Association
          California Nurses Association
          California State Pipe Trades Council
          California State University
          California State University Employees' Union
          California Taxpayers Association
          California Teachers Association








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          Californians Aware
          Coalition of California Utility Employees
          Eric Mar, San Francisco District 1 Supervisor
          International Brotherhood of Electrical Workers
          International Union of Elevator Constructors
          Pacific Media Workers Guild
          SEIU United Service Workers West
          University of California
          University of California Student Association
          Utility Workers Union of America
          Western States Council of Sheet Metal Workers
           
            Opposition 
           
          None on file

           
          Analysis Prepared by  :    Eric Johnson / G. O. / (916) 319-2531