BILL ANALYSIS �
AB 409
Page 1
Date of Hearing: September 12, 2013
ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING
Paul Fong, Chair
AB 409 (Quirk-Silva) - As Amended: August 29, 2013
CONCURRENCE IN SENATE AMENDMENTS
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|ASSEMBLY: | |(May 28, 2013) |SENATE: |37-0 |(September 11, |
| | | | | |2013) |
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(vote not relevant)
SUBJECT : Political Reform Act of 1974: statements of economic
interests: online filing.
SUMMARY : Permits the Fair Political Practices Commission (FPPC)
to develop and operate an online system for filing statements of
economic interests (SEIs).
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Permit the FPPC to develop and operate an online system for
filing SEIs as required by the Political Reform Act (PRA).
2)Require the FPPC, if it develops an online system for filing
SEIs pursuant to this bill, to do all of the following:
a) Include the following features in any system it
develops:
i) A method by which a filer can electronically file
his or her SEI free of charge;
ii) Security safeguards, including firewalls, data
encryption, secure authentication, and necessary hardware
and software and industry best practices to ensure the
security and integrity of the information contained in
each SEI; and,
iii) The ability to issue a confirmation to a person who
files his or her SEI using the system, including a
notification of the date and time that the SEI was
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received by the FPPC and method for the filer to view and
print the information received.
b) Conduct public hearings on the implementation of the
system, maintain ongoing coordination among affected state
and local agencies as necessary, and develop training and
assistance programs for filing officers and the filer;
c) Specify the categories of persons that are permitted to
file their SEIs using that system, and, with respect to any
category of filer that it permits to file SEIs using that
system, assume the duties of the filing officer for each
filer within that category of filers upon authorization of
the designated filing officer. With respect to any filing
officer from which the FPPC assumes the duties of that
officer, requires the filing officer to provide the FPPC
with the name and contact information for each filer in the
officer's jurisdiction, and provides that the duties
assumed by the FPPC include the following:
i) Notifying the filer of his or her filing obligation;
ii) Receiving the filer's SEI;
iii) Ensuring compliance with filing requirements in the
event the filer fails to file in a timely manner or is
required to amend his or her SEI; and,
iv) Distributing to filing officers copies of the
completed SEI of a person who is required to file more
than one SEI for each period, and who, despite being
authorized to file the SEI with the FPPC electronically,
elects to file the SEI with the FPPC using a paper form.
3)Require the FPPC to notify a filing officer who may be
affected by a determination by the FPPC to authorize a
category of filers to file SEIs electronically no later than
six months before the implementation of that determination, in
order to allow adequate preparation for implementation.
4)Provide that a paper copy of an SEI filed electronically and
the confirmation that is retained by the filer, that shows
that the filer timely filed his or her SEI, creates a
rebuttable presumption that the SEI was filed on time.
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5)Permit the FPPC to make the data filed using the online system
for filing of SEIs available on its Web site, and require the
FPPC to provide assistance to those seeking public access to
the information. Require the FPPC to redact private
information from the data that is made available on the
Internet, as specified.
6)Provide that a person who is required to file more than one
SEI for each reporting period and who files his or her SEI
with the FPPC electronically is not required to file an SEI
with any other person or agency.
7)Permit the FPPC, after it makes an initial determination
regarding which categories of persons are permitted to file
SEIs electronically through the online system, to revise the
determination at any time, as specified.
8)Add an urgency clause, allowing this bill to take effect
immediately upon enactment.
EXISTING LAW :
1)Creates the FPPC, and makes it responsible for the impartial,
effective administration and implementation of the PRA.
2)Requires that candidates for, and current holders of,
specified elected or appointed state and local offices and
designated employees of state and local agencies file SEIs
disclosing their financial interests, including investments,
real property interests, and income.
3)Authorizes an agency to permit the electronic filing of an
SEI, including amendments, in accordance with regulations
adopted by the FPPC.
AS PASSED BY THE ASSEMBLY , this bill required the California
State University Board of Trustees and the California Community
Colleges Board of Governors to convene a task force to evaluate
and report to the Governor and the Legislature how best to serve
the transitional needs of postsecondary student veterans, as
specified, and encouraged the University of California Regents
to participate in the task force.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
AB 409
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COMMENTS :
1)Purpose of the Bill : According to the author:
Currently state law requires all state legislators,
judges, Fair Political Practices Commissioners, county
boards of supervisors, mayors, and city councilmembers
to file a Statement of Economic Interest (SEI) which
is filed with the Fair Political Practices Commission
(FPPC) by filling out Form 700. The intent for this
filing is to create transparency of economic interest
that public officials and other filers may have to
ensure decision making is not made to enhance their
own personal finances.
On May 30th, 2013 the FPPC released a Request for
Information (RFI) in regards to Form 700s electronic
filing. The document gives explicit details to the
needs for the FPPC to advance with current technology
and how it would create effective and sufficient
transparency to the general public?.
In recent years the FPPC has moved towards an online
approach of the availability of Form 700s. One
proactive approach that they have taken is scanning
Form 700s and placing the forms on the internet for
the public to access. In 2011 the FPPC had changed its
policy for California judges to have the ability to
file electronically which now provides Form 700
information in a digitized electronic user friendly
form for this demographic of filers.?Such proactive
steps to move to electronic filing aligns with a goal
of the FPPC [to] lessen the amount of paper that is
used for filings. Lastly, the FPPC has stated on
several occasions that electronic filing would
increase the amount of transparency available to the
public as it is the duty of the FPPC to provide
transparency to the general public.
It is suggested in the RFI report that moving from
paper filing to electronic filing will be cost saving
to the FPPC and other local agencies that file and
store Form 700s. It is stated that agencies will save
on personnel cost due to an expected decrease in Form
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700 request[s], manual processing, and paper cost.
2)Statements of Economic Interests : As part of the PRA's
comprehensive scheme to prevent conflicts of interest by state
and local public officials, existing law identifies certain
elected and other high-level state and local officials who
must file SEIs. Similarly, candidates for those positions must
file SEIs. Other state and local public officials and
employees are required to file SEIs if the position they hold
is designated in an agency's conflict of interest code. A
position is designated in an agency's conflict of interest
code when the position entails the making or participation in
the making of governmental decisions that may foreseeably have
a material financial effect on the decision maker's financial
interests.
The information that must be disclosed on an SEI, and the
location at which an SEI is filed, varies depending on the
position held by the individual who is required to file an
SEI. Although there are some exceptions, individuals who are
required to file an SEI typically must file that document with
the agency of which they are an elected official or by which
they are employed. In some cases, original SEIs or copies
thereof are filed with the FPPC. The requirement for public
officials to file SEIs serves two purposes. First, the SEI
provides necessary information to the public about an
official's personal financial interests so there is assurance
that officials are making decisions that do not enhance their
personal finances. Second, the requirement to file an SEI
serves as a reminder to the public official of potential
conflicts of interests so the official can recuse him or
herself from making or participating in governmental decisions
that are deemed conflicts.
While the exact number of people that are required to file SEIs
is unknown, the FPPC has estimated that 500,000 SEIs could be
filed by officials and employees throughout the state each
year. No central repository of SEI filings currently exists,
and with just a fraction of the forms filed electronically, a
searchable tool to illuminate activities on a statewide level
is nearly impossible.
Although there is no statutory requirement for the FPPC to post
SEIs online, in 2010, the FPPC adopted a regulation requiring
it to post the SEIs of all elected officers who, in their
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elected capacities, are required to file their SEIs with the
FPPC. As a result, the FPPC now posts SEIs for all
constitutional officers, legislators, judges, members of
county boards of supervisors, mayors, and city councilmembers.
Additionally, the FPPC has chosen to post the SEIs of FPPC
Commissioners and legislative candidates. Prior to posting
these SEIs on the FPPC website, the forms have to be manually
scanned, and certain information (such as addresses and
signatures) has to be manually redacted from the forms.
According to the FPPC, this is labor intensive and costly.
With interest in government transparency increasing, the number
of requests by the public to view SEI filings continues to
escalate each year. The FPPC is mandated to provide access to
SEIs no later than the second business day after receiving the
forms. When the FPPC receives a request for SEIs, staff must
manually retrieve the forms from their file room, make copies,
and either provide hard copies or email the copies to the
requestor.
By permitting the FPPC to establish an electronic system for
filing SEIs, the FPPC anticipates that this bill could provide
significant cost savings to the state by eliminating the staff
time currently spent processing and filing SEIs, providing
public access to paper filings, and manually scanning and
redacting information from SEIs that will be posted on the
FPPC's Web site. Additionally, the FPPC anticipates that an
electronic filing system would significantly reduce
inadvertent errors on SEIs, which would reduce the need to
send correspondence to attempt to correct those inadvertent
errors.
While this bill permits the FPPC to establish an electronic
system for filing SEIs, it would be up to each individual
filer to decide whether to use that system or to file an SEI
on paper. This bill permits the FPPC to make the information
that is filed using the electronic system available on its Web
site, but does not require it to do so.
3)Previous Legislation : AB 2062 (Davis), Chapter 500, Statutes
of 2012, authorizes local agencies to develop systems for the
electronic filing of SEIs, in accordance with regulations
adopted by the FPPC.
4)Political Reform Act of 1974 : California voters passed an
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initiative, Proposition 9, in 1974 that created the FPPC and
codified significant restrictions and prohibitions on
candidates, officeholders and lobbyists. That initiative is
commonly known as the PRA. Most amendments to the PRA that
are not submitted to the voters, including those contained in
this bill, must further the purposes of the initiative and
require a two-thirds vote of both houses of the Legislature.
5)Prior Version : The prior version of this bill, which was
approved by the Assembly, would have established a task force
to determine how best to serve the transitional needs of
postsecondary student veterans. Those provisions were removed
from this bill in the Senate, and the current contents were
added. As a result, this bill has been re-referred to this
committee pursuant to Assembly Rule 77.2.
REGISTERED SUPPORT / OPPOSITION :
Support
Fair Political Practices Commission (sponsor)
City Clerks Association of California
Opposition
None on file.
Analysis Prepared by : Ethan Jones / E. & R. / (916) 319-2094