BILL ANALYSIS Ó SENATE COMMITTEE ON ELECTIONS AND CONSTITUTIONAL AMENDMENTS Senator Lou Correa, Chair BILL NO: SB 168 HEARING DATE: 3/15/11 AUTHOR: CORBETT ANALYSIS BY: Darren Chesin AMENDED: AS INTRODUCED FISCAL: YES SUBJECT Petitions: compensation for signatures DESCRIPTION Existing law provides that a voter or a person who is qualified to register to vote in this state may circulate an initiative, referendum petition or recall petition as specified. Existing law does not prohibit a person from paying or receiving money for the circulation of petitions for signatures nor does it prohibit paying or receiving payment based on the number of signatures gathered. Existing law requires that state or local initiative petitions must contain the following notice in 12-point type: "NOTICE TO THE PUBLIC THIS PETITION MAY BE CIRCULATED BY A PAID SIGNATURE GATHERER OR A VOLUNTEER. YOU HAVE THE RIGHT TO ASK." This bill makes it a misdemeanor for a person to pay or to receive money or any other thing of value based on the number of signatures collected on a state or local initiative, referendum, or recall petition. Specifically, this bill: Provides that a person or organization who pays a person based on the number of signatures obtained on a state or local initiative, referendum, or recall petition shall be punished by a fine not to exceed $25,000, or by imprisonment in a county jail not to exceed one year, or by both that fine and imprisonment. Provides that a person who is paid based on the number of signatures obtained on a state or local initiative, referendum, or recall petition shall be punished by a fine not to exceed $1,000, or by imprisonment in a county jail not to exceed six months, or by both that fine and imprisonment. States that this bill does not prohibit the payment for signature gathering not based, either directly or indirectly, on the number of signatures obtained on a state or local initiative, referendum, or recall petition. BACKGROUND Bounty Hunters . To qualify an initiative to be placed on the statewide ballot, proponents must gather hundreds of thousands of signatures. The need to collect this large number of signatures within a limited timeframe has given rise to an industry of petition management firms that pay signature gatherers a bounty based on the number of signatures they collect. The individuals who are paid to collect signatures on initiative, referendum, or recall petitions are commonly referred to as "bounty hunters." According to the Secretary of State's Election Fraud Investigation Unit (EFIU) between 1994 and 2010 the EFIU opened 240 cases for falsifying petitions resulting in 33 convictions. Other States . According to the National Conference of State Legislatures (NCSL), it is common for initiative sponsors to pay circulators on a per-signature basis to gather petition signatures. Payments typically range from $1 to $3 per signature, and occasionally are as high as $10 per signature. Critics argue that this encourages fraud -- since a circulator who collects more signatures will earn more money, circulators who are paid per signature are more SB 168 (CORBETT) Page 2 likely to commit acts of fraud such as forging signatures or misrepresenting the content of the petition in order to encourage people to sign. In three states (North Dakota, Oregon and Wyoming), initiative sponsors are banned from paying petition circulators per signature. Instead, they may pay a flat fee or an hourly wage. These laws have been challenged in the courts with mixed results. North Dakota and Oregon's provisions have been upheld by the U.S. 9th and 8th Circuit Courts, respectively. However, similar provisions in Idaho, Maine, Mississippi and Washington were held unconstitutional by federal district courts. More on Relevant Jurisprudence . In 1988, the United States Supreme Court ruled that a Colorado prohibition against the use of paid circulators for initiative petitions violated the First Amendment's guarantee of free speech. Writing for a unanimous court, Justice Stevens noted that "Ýt]he State's interest in protecting the integrity of the initiative process does not justify the prohibition because the State has failed to demonstrate that it is necessary to burden appellees' ability to communicate their message in order to meet its concerns." Meyer v. Grant (1988), 486 U.S. 414. The Meyer court, however, did not address the issue of whether a state may regulate the manner in which circulators are paid. In 1999, the United States Supreme Court examined another Colorado law that provided a number of other restrictions on the signature collection process for ballot initiatives. In that case the court ruled that there must be a compelling state interest to justify any restrictions on initiative petition circulation. Buckley v. American Constitutional Law Foundation (1999), 525 U.S. 182. In February 2001, the U.S. Eighth Circuit Court of Appeals ruled that a North Dakota law prohibiting payment for signature collection on a per-signature basis was consistent with the United States Constitution and with the Supreme Court's rulings in Buckley and Meyer . In reaching this decision, the court noted that the state "produced sufficient evidence that the regulation is necessary to insure the integrity of the initiative process," and also SB 168 (CORBETT) Page 3 noted that no evidence was presented "that payment by the hour, rather than on commission, would in any way burden Ýthe] ability to collect signatures." Initiative & Referendum Institute v. Jaeger (2001), 241 F.3d 614. In February 2006, the U.S. Ninth Circuit Court of Appeals ruled that an Oregon law that prohibited payment to electoral petition signature gatherers on a per-signature basis did not impose a severe burden under the First Amendment, and therefore did not unconstitutionally burden core political speech. The court found that Oregon had an "important regulatory interest in preventing fraud and its appearances in its electoral processes," and that prohibiting the payment of signature gatherers on a per-signature basis was reasonably related to that interest. Prete v. Bradbury (2006), No. 04-35285. COMMENTS 1.According to the author , some signature gathering firms compensate circulators based on the number of signatures they collect. Some circulators reach the deadline to qualify initiatives by illegally misinforming voters and forging names. Circulators forged signatures onto their petitions of names they chose from a phonebook in several states. Others have inserted carbon paper and a second petition beneath the original one, without the persons' knowledge, to get their signature on another petition. 2.Prior Legislation . SB 34 (Corbett) of 2009, which was identical to this bill, was vetoed by Governor Schwarzenegger. In his veto message, the Governor stated, in part: "The California Constitution provides an important system of checks and balance by giving the people direct control over their government through initiative, referendum and recall. This bill would limit the initiative process by prohibiting a person from paying or receiving money or anything of value based on the number of signatures obtained on such petitions. As I have stated when vetoing similar legislation, SB 168 (CORBETT) Page 4 prohibitions on per-signature payments will make it more difficult for grassroots organizations to gather the necessary signatures and qualify measures for the ballot. Therefore, I am unable to sign this bill." SB 1047 (Bowen) and AB 2946 (Leno), both from the 2005-06 session, contained provisions similar to this bill that prohibit payment on per-signature basis for individuals circulating petitions. SB 1047 was eventually dropped by the author while AB 2946 was vetoed. POSITIONS Sponsor: Author Support: City of Murrieta Secretary of State Oppose: None received SB 168 (CORBETT) Page 5