BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



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          |SENATE RULES COMMITTEE            |                     SB 8|
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                              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

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           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, 

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             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; 


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             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 

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                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 

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          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 

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          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


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           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 

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          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

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