BILL ANALYSIS Ó SB 168 Page 1 SENATE THIRD READING SB 168 (Corbett) As Introduced February 3, 2011 Majority vote SENATE VOTE :23-15 ELECTIONS 5-2 APPROPRIATIONS 10-5 ----------------------------------------------------------------- |Ayes:|Fong, Bonilla, Hall, |Ayes:|Fuentes, Bradford, | | |Mendoza, Swanson | |Charles Calderon, Campos, | | | | |Gatto, Hall, Hill, Lara, | | | | |Mitchell, Solorio | | | | | | |-----+--------------------------+-----+--------------------------| |Nays:|Logue, Valadao |Nays:|Harkey, Donnelly, | | | | |Nielsen, Norby, Wagner | | | | | | ----------------------------------------------------------------- SUMMARY : Prohibits a person from paying another person or being paid based on the number of signatures obtained on an initiative, referendum, or recall petition. Specifically, this bill : 1)Makes it unlawful for a person to pay or to receive money or any other thing of value based on the number of signatures obtained on a state or local initiative, referendum, or recall petition. 2)Provides that a violation of this bill is a misdemeanor subject to the following penalties: a) For a person or organization that pays someone based on the number of signatures collected, a fine of up to $25,000 and/or imprisonment in a county jail for up to one year; and, b) For a person paid based on the number of signatures collected, a fine of up to $1,000 and/or imprisonment in a county jail for up to six months. 3)Provides that nothing in this bill prohibits the payment for signature gathering that is not based, either directly or SB 168 Page 2 indirectly, on the number of signatures collected on a petition. FISCAL EFFECT : According to the Assembly Appropriations Committee, unknown, likely minor non-reimbursable costs to cities and counties for prosecution and incarceration, offset to some extent by fine revenues. COMMENTS : 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. Others have forged signatures onto their petitions by copying names they chose from a phonebook. Lastly, some have inserted carbon paper and a second petition behind the original one in order to collect signatures." In 1999, the United States Supreme Court examined a Colorado law that imposed a number of 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. Although the United States Supreme Court has not ruled on the constitutionality of prohibiting payment for signature collection on a per-signature basis, a number of federal courts have considered challenges to such laws, with the courts reaching different conclusions. Federal appellate courts in the Second, Eighth, and Ninth Circuits upheld laws that prohibited payments for signature collection on election petitions on a per-signature basis, while the Sixth Circuit Court of Appeals struck down a similar law in Ohio. Additionally, a number of federal district courts have struck down bans on per-signature payments in other states. In light of the differing opinions reached by various federal courts on the constitutionality of laws that prohibit payments on a per-signature basis for signature gathering on petitions, it is unclear whether a court challenge to this bill, if enacted, would be successful. According to the Secretary of State's Election Fraud Investigation Unit (EFIU), between 1994 and 2010, the EFIU opened 240 cases for falsifying petitions, of which 46 were sent SB 168 Page 3 to district attorneys for prosecution, resulting in 33 convictions. Since the EFIU was created in 1994, a larger number of convictions have been obtained for falsified petitions than for any other election crime except fraudulent voter registration. This bill prohibits the payment of individuals on a per-signature basis for collecting signatures on petitions. Typically, in California, individuals who are paid to circulate petitions or register voters on a per-signature or per-piece basis are independent contractors. However, to the extent that this bill forces individuals who are paid to circulate petitions or register voters to be paid an hourly wage, this bill could also result in these individuals being considered employees under California law. As such, the individual, corporation, or group paying individuals to circulate petitions may be required to pay minimum wage, provide workers' compensation insurance and unemployment insurance for its employees, and maintain a payroll system. This may result in higher costs to groups that pay individuals to circulate petitions. In addition, prohibiting payment of individuals on a per-signature basis could increase costs because it may become more difficult to measure the work product of petition circulators. Potential increased costs may be partially offset if, by reducing the incentive to submit fraudulently-obtained signatures, this legislation results in paid circulators submitting fewer such signatures. Supporters of this bill contend that paying signature gatherers on a per-signature basis encourages fraud, because a circulator who collects more signatures will earn more, and is more likely to forge signatures or misrepresent the content of a petition in order to encourage people to sign. Opponents of this bill contend that outlawing payment for signature collection on a per signature basis will "make it prohibitively expensive to do an initiative or a recall and next to impossible to do a referendum," and argue that there is little evidence that per-signature payment methods are more prone to fraud than other methods. This bill is identical to SB 34 (Corbett) of 2009, which was vetoed. In his veto message, Governor Schwarzenegger expressed concern that prohibiting per-signature payments could "make it more difficult for grassroots organizations to gather the necessary signatures and qualify measures for the ballot." SB 168 Page 4 Please see the policy committee analysis for a full discussion of this bill. Analysis Prepared by : Ethan Jones / E. & R. / (916) 319-2094 FN: 0001512