BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 8| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 445-6614 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ UNFINISHED BUSINESS Bill No: SB 8 Author: Yee (D), et al. Amended: 7/14/11 Vote: 21 SENATE JUDICIARY COMMITTEE : 4-1, 3/29/11 AYES: Evans, Harman, Corbett, Leno NOES: Blakeslee SENATE EDUCATION COMMITTEE : 7-1, 5/11/11 AYES: Lowenthal, Runner, Alquist, Hancock, Huff, Price, Vargas NOES: Blakeslee NO VOTE RECORDED: Liu, Simitian, Vacancy SENATE FLOOR : 38-1, 6/2/11 AYES: Alquist, Anderson, Berryhill, Calderon, Cannella, Corbett, Correa, De León, DeSaulnier, Dutton, Emmerson, Evans, Fuller, Gaines, Hancock, Harman, Hernandez, Huff, Kehoe, La Malfa, Leno, Lieu, Liu, Lowenthal, Negrete McLeod, Padilla, Pavley, Price, Rubio, Simitian, Steinberg, Strickland, Vargas, Walters, Wolk, Wright, Wyland, Yee NOES: Blakeslee NO VOTE RECORDED: Runner ASSEMBLY FLOOR : 75-0, 8/15/11 - See last page for vote SUBJECT : Public records: auxiliary organizations and University of California campus foundations CONTINUED SB 8 Page 2 SOURCE : American Federation of State, County and Municipal Employees, AFL-CIO California Faculty Association California Newspaper Publishers Association DIGEST : This bill updates the California Public Records Act to include auxiliary organizations at University of California, California State University, and the California community colleges statewide foundation. Placing state college and university auxiliaries under the authority of the public records act will safeguard the use of taxpayer funds and provide much needed accountability and oversight to state policymakers. Assembly Amendments (1) add legislative findings and declarations, (2) recast language with the same intent as when it left the Senate, (3) add co-authors, and (4) tombstone the bill as the Richard McKee Transparency Act of 2011. ANALYSIS : The California Public Records Act (CPRA) requires state and local agencies to make their records available for public inspection and to make copies available upon request and payment of a fee unless those records are exempt from disclosure. Existing law establishes the segments of public postsecondary education in the state, including, but not limited to, the University of California (UC) administered by the Regents of the UC and the California State University (CSU) administered by the Trustees of the CSU. This bill requires records maintained by an auxiliary organization of the CSU, California Community Colleges (CCC), and CCC districts and a campus foundation of the UC be available to the public consistent with the CPRA, excepting specified donor information. Specifically, this bill: 1. Finds that CSU and CCC auxiliaries and UC foundations are independently governed, legally separate entities that are essential and integral to the missions of CSU, CONTINUED SB 8 Page 3 CCC, and UC, respectively. 2. Establishes the Richard McKee Transparency Acts of 2011, which require records, as defined, maintained by a CSU or CCC auxiliary organization or UC campus foundation to be made available to the public and require 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 Sections 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; 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; CONTINUED SB 8 Page 4 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. 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. 6. Provides that when an auxiliary or campus foundation disclose 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 CONTINUED SB 8 Page 5 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. 7. Provides that these provisions do not apply to any records subject to a request made pursuant to CPRA. 8. Defines a UC campus foundation as the following corporations organized under the laws of the State of California: UC Berkeley Foundation, UC Davis Foundation, UC Irvine Foundation, UCLA Foundation, UC Merced Foundation, UC Riverside Foundation, UC San Diego Foundation, UC San Francisco Foundation, UC Santa Barbara Foundation, UC Santa Cruz Foundation, and any other foundation authorized by the Regents of the UC. Comments A 2001 court decision, California State University, Fresno Assn., Inc. v. Superior Court (2001) 90 Cal.App.4th 810, 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 ÝYee] of 2010, and SB 330 ÝYee] of 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. This bill 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 differs slightly CONTINUED SB 8 Page 6 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. This bill also exempts donor information unique to these entities from disclosure, except under the following circumstances: 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. 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. 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 percent 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. 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 CONTINUED SB 8 Page 7 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 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, that are not separate, independent entities. As such, these "auxiliary enterprises" are already subject to 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 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. Richard McKee was co-founder of Californians Aware, which promotes open government. Mr. McKee, who passed away in April 2011, was a chemistry professor at Pasadena City College who, despite a lack of formal legal training, became a leading advocate for open government. According to the Los Angeles Times, he filed 25 lawsuits over the last 17 years and prevailed in the majority of them. FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local: No CONTINUED SB 8 Page 8 SUPPORT : (Verified 8/16/11) American Federation of State, County and Municipal Employees, AFL-CIO (co-source) California Faculty Association (co-source) California Newspaper Publishers Association (co-source) Academic Professionals of California California Broadcasters Association California Federation of Teachers California Nurses Association, National Nurses Organizing Committee California State Pipe Trades Council California State University Employees Union California Taxpayers Association California Teachers Association Californians Aware Coalition of California Utility Employees International Brotherhood of Electrical Workers International Union of Elevator constructors Pacific Media Workers Guild Supervisor Eric Mar, San Francisco Board of Supervisors University of California University of California Student Association Utility Workers Union of America Western States Council of Sheet Metal Workers ARGUMENTS IN SUPPORT : Responding to Governor Schwarzenegger's veto message of SB 218 (Yee), Session of 2009-10, this bill now exempts the names of volunteers and donors so long as certain provisions are met. This bill also allows auxiliary organizations to exempt from disclosure information "obtained in the process of soliciting potential donors that has actual or potential independent economic value because it is not generally known to the public or because individuals can obtain economic value from its disclosure or use." This bill applies the CPRA to auxiliary organizations at UC, CSU, and any auxiliary established CCC Board of Governors (the CPRA already applies to auxiliary bodies established by local community college districts). This bill reaffirms existing exemptions to the CPRA for propriety information, trade secrets, or other documents CONTINUED SB 8 Page 9 that have an economic value (actual or potential economic value such as prospective donor lists). ASSEMBLY FLOOR : 75-0, 8/15/11 AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill Berryhill, Block, Bradford, Brownley, Buchanan, Butler, Charles Calderon, Campos, Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson, Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines, Garrick, Gatto, Gordon, Grove, Hagman, Halderman, Hall, Harkey, Hayashi, Roger Hernández, Hill, Huber, Hueso, Huffman, Jeffries, Jones, Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor, Mendoza, Miller, Mitchell, Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Perea, V. Manuel Pérez, Portantino, Silva, Skinner, Smyth, Solorio, Swanson, Torres, Valadao, Wagner, Wieckowski, Williams, Yamada, John A. Pérez NO VOTE RECORDED: Blumenfield, Bonilla, Galgiani, Gorell, Pan RJG:kc 8/16/11 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED