BILL ANALYSIS �
AB 1090
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Date of Hearing: May 8, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 1090 (Fong) - As Amended: April 10, 2013
Policy Committee: ElectionsVote:4-2
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill provides the Fair Political Practices Commission
(FPPC) with new authority and responsibility regarding
enforcement of Government Code Section 1090, dealing with
conflict-of-interest in contracting decisions by elected and
appointed officials. Specifically, this bill:
1)Makes violation of Section 1090 by an elected or appointed
official subject to an administrative or civil action brought
by the FPPC in addition to the existing criminal penalty for
such violations.
2)Prohibits the FPPC from initiating an administrative or civil
action per the above (a) absent a written authorization from
the district attorney where the alleged violation occurred, or
(b) if the Attorney General (AG) or a district attorney is
pursuing a criminal prosecution.
3)Authorizes a person subject to the conflict-of-interest
prohibitions to request an opinion from the FPPC, which the
commission may provide by opinion or formal/informal advice.
4)Requires the FPPC, upon receipt of a formal complaint alleging
a Section 1090 violation, to investigate the allegation, and
prohibits the commission from making a finding of probable
cause of a violation prior to notifying the person alleged to
have made the violation. The FPPC is required to hold a
hearing following a finding of probable cause.
5)Prohibits the FPPC from commencing an administrative action
for a violation if the commission is already pursuing a civil
action regarding the same matter, and vice versa.
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6)Makes a person held liable for a violation of the
conflict-of-interest statute subject to a civil penalty of up
to three times the value of the financial benefit to the
person.
7)Authorize the FPPC to obtain a judgment in superior court to
collect unpaid penalties or fees.
8)Authorizes the FPPC, if the all means of judicial review of a
final commission order or decision are exhausted, to apply to
the superior court clerk for a judgment to collect penalties
imposed by the order or decision regarding a Section 1090
violation.
FISCAL EFFECT
Any additional costs to the FPPC will be minor and absorbable,
and offset to some extent by fine and penalty revenues.
COMMENTS
1)Background . The conflict of interest laws in the
Political Reform Act (PRA) apply broadly to all types of
governmental decisions. A separate conflict of interest
law-Government Code Section 1090-applies only to
contracting decisions, and generally prohibits a public
official or employee from making a contract in his or her
official capacity in which he or she has a financial
interest. In addition, a public body or board is
prohibited from making a contract in which any member of
the body or board has a financial interest, even if that
member does not participate in the making of the
contract. (The prohibitions contained Section 1090 date
back to the second session of the Legislature (Chapter
136, Statutes of 1851).)
Unlike the conflict of interest rules contained in the
PRA, the FPPC does not have a role in enforcing Section
1090. Instead, enforcement actions under this statute
may be brought only by the AG or a county district
attorney. Furthermore, unlike the PRA, which can be
enforced through criminal, civil, or administrative
actions, Section 1090 can be enforced only through
criminal prosecutions. Because contracting decisions fall
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within the broader conflict of interest rules contained
in the PRA, however, the FPPC nonetheless can and does
bring enforcement actions under the PRA for conflicts of
interest that arise in the context of contracting
decisions.
Various provisions of state law provide exceptions to, or
limitations on, Section 1090. Given the complexity of
Section 1090 and the various exceptions to, and
limitations on, that section, it can be difficult for a
public board or body to determine whether or not a member
has an impermissible financial interest in a contract
made by the board or body. The AG and county district
attorneys have enforcement authority over Section 1090,
but neither the AG nor district attorneys typically give
legal opinions on the application of this statute.
2)Purpose . AB 1090 is intended to improve enforcement of
the state's conflict of interest laws by allowing the
FPPC to bring civil or administrative enforcement actions
in response to violations of Section 1090. Given the
similarity between the PRA and Section 1090, authorizing
the FPPC to provide opinions and advice regarding Section
1090, and to bring civil and administrative enforcement
actions for violations of Section 1090, may result in
greater consistency in the enforcement of these conflict
of interest laws and may make it easier for public
officials acting in good faith to comply.
3)Opposition . The Association of California Water Agencies
argues that existing criminal sanctions for violations of
Section 1090 are sufficient.
4)Related Legislation . AB 552 (Fong), also on today's
committee agenda, contains a similar provision to this
bill in providing the FPPC with an expedited process to
obtain a court judgment to collect penalties imposed by
an FPPC enforcement order under the PRA.
5)Prior Legislation . AB 1558 (Wolk) of 2005 and AB 3003
(Hayashi) of 2008 both authorized a pilot project for the
FPPC to provide written opinions on Section 1090. AB 1558
was held on Suspense in Senate Appropriations and AB 3003
was held on this committee's Suspense file. The
commission indicates that issues raised under 1090 are
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very similar to its current conflict of interest cases
and advice requests, which are processed with existing
resources. The commission also has additional staff
resources at this time.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081