BILL ANALYSIS Ó AB 857 Page 1 Date of Hearing: May 8, 2013 ASSEMBLY COMMITTEE ON APPROPRIATIONS Mike Gatto, Chair AB 857 (Fong) - As Amended: April 16, 2013 Policy Committee: ElectionsVote:5-2 Urgency: No State Mandated Local Program: Yes Reimbursable: Yes SUMMARY This bill establishes additional requirements for initiative petitions and for persons paid to solicit signatures for such petitions. Specifically, this bill: 1)Requires an initiative petition circulated by a paid person to be printed on yellow paper and to include all of the following: a) A specified printed warning that the circulator is being paid and an advisement to read the contents before signing. b) The identity of the political committee paying the circulator and a list of top three donors who have contributed more than $50,000 within the last six months. If this information changes, it is to be updated within 14 days. 2)Requires a petition circulated by an unpaid person to be printed on white paper, and requires that person to sign an affidavit from the Secretary of State (SOS) containing specified information, including a declaration that they are not paid for soliciting signatures. 3)Requires that at least 20% of the total signatures submitted to qualify an initiative be from petitions circulated by unpaid persons. 4)Stipulates that an employee or member of a nonprofit organization who is paid as part of that employment or membership is not considered a paid signature gatherer for purposes of (3). AB 857 Page 2 5)Stipulates that signatures obtained by a member of a political party who receive money from that party for soliciting those signatures does not count toward meeting the requirement in (3). 6)Stipulates that signatures gathered via direct mail do not count toward meeting the requirement in (3) if the person soliciting the signatures is paid primarily for that purpose, unless the person belongs to a nonprofit organization per (4). 7)Requires a person who pays to have signatures solicited and a person who is paid for this work to register with the SOS and complete a training program pursuant to regulations adopted by the SOS. 8)Requires a person required to register per (7) to file an application, as specified, with the SOS, and requires the SOS, within five business days of receiving a completed application to assign the person a registration number, which shall be effective for two years. 9)Stipulates that signatures submitted by a paid circulator who is not registered with the SOS do not count toward qualifying the initiative. 10)Requires paid signature gatherers to wear a badge, as prescribed in regulation by the SOS, containing their photograph and registration number. 11)Requires the SOS to revoke the registration of person engaging in fraudulent conduct with respect to signature gathering and stipulates that the signatures gathered by this person are invalid. 12)Requires persons paying to have initiative petitions circulated to maintain specified records, and requires the SOS to review these records on a regular schedule. 13)Makes all of the above applicable to initiatives for which Attorney General has issued a circulating title and summary on or after October 1, 2013. FISCAL EFFECT AB 857 Page 3 1)The SOS will incur GF significant costs to establish a registration and training program for paid petition circulators and to regularly review accounts of paid signature gathering entities. The number of registrants is unknown, but assuming 75,000 statewide, annual costs are estimated at around $1.6 million (somewhat higher in the first year) for 22 staff to process applications, respond to inquiries, investigate complaints and conduct enforcement. (The SOS's current registration program for notaries operates with a staff of 44 for 161,000 registrants.) There will also be one-time information technology costs exceeding $1 million-requiring a feasibility study report and state control agency approval-plus ongoing general administrative costs (business services and human resources) of around $250,000. 2)County elections officials indicate that an initiative will have separate volunteer and paid circulator-gathered petitions, and thus will be treated as two separate petitions for their signature-checking systems in order to meet the minimum threshold requirement of volunteer-gathered signatures. For a voter who signs both the volunteer's petition and the paid circulator's petition, their systems cannot cross-reference the two different petitions for duplicates. Therefore, the state-reimbursable cost for all 58 counties to conduct this cross-referencing could exceed $150,000 per initiative measure. Depending on the number of initiatives submitted for qualification, the total costs could easily exceed $1 million annually. COMMENTS Purpose . According to the author, over the last 30 years, the initiative has become one of the favorite tools of well-financed special interest groups, contrary to the original intent of the initiative process. Voters recognize that the ability of an initiative's proponents to gather the necessary signatures to qualify a measure for the ballot depends on the amount of money that a proponent is willing to spend, rather than whether there is broad-based community support for a proposed measure. Since the 1990s, most initiative measures have relied primarily on paid signature gatherers to qualify for the ballot, and no state initiative measure has qualified for the ballot using only volunteer signature gatherers since AB 857 Page 4 1990. In the past 20 years, there have been dozens of convictions for fraudulent signature gathering, and most (if not all) of those convictions have been of paid signature gatherers. At the same time, proposed initiative measures with true grassroots support have continued to have success in collecting large numbers of signatures using volunteer signature gatherers. In 2008, proponents of Proposition 2 gathered half a million signatures using volunteer signature gatherers. According to the author, to ensure that proposed initiatives have broad-based community support, AB 857 requires at least 20% of initiative petition signatures to be collected by grassroots signature gatherers. Additionally, AB 857 seeks to ensure that measures do not qualify for the ballot due to fraudulent activity by signature gatherers by prohibiting fraudulently collected signatures from being used to qualify a measure for the ballot. Finally, AB 857 helps protect the integrity of the initiative process by requiring paid signature gatherers to undergo training and to register with the SOS. Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081