BILL ANALYSIS Ó
SB 1103
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Date of Hearing: June 24, 2014
ASSEMBLY COMMITTEE ON ELECTIONS AND REDISTRICTING
Paul Fong, Chair
SB 1103 (Padilla) - As Amended: June 17, 2014
SENATE VOTE : 34-1
SUBJECT : Political Reform Act of 1974: candidacy for elective
state office.
SUMMARY : Prohibits an elected state officer or a candidate for
elected state office from having more than two campaign
contribution accounts open for receiving contributions in
connection with elective state office, or from opening a
campaign contribution account to run for elective state office
at an election that is more than four years in the future.
Specifically, this bill :
1)Provides that if an individual has previously filed a
statement of intention to be a candidate for an elective state
office, and that individual subsequently files a statement of
intention to be a candidate for a different elective state
office to be voted on at the same election, the filing of the
second statement of intention shall constitute a revocation of
the previously filed statement of intention. Provides that
the individual shall not thereafter solicit or receive a
contribution or a loan for the elective state office for which
he or she previously filed a statement of intention to be a
candidate.
2)Prohibits an individual from filing, and prohibits the
Secretary of State from accepting, either of the following:
a) A statement of intention to be a candidate for the
office of Member of the Assembly at an election other than
the next two elections at which the office will appear on
the ballot; or,
b) A statement of intention to be a candidate for an
elective state office other than the office of Member of
the Assembly at an election other than the next election at
which that elective state office will appear on the ballot.
3)Prohibits an elected state officer or candidate for elective
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state office from having more than two campaign contribution
accounts open simultaneously for purposes of receiving
contributions in connection with elective state offices.
4)Contains an urgency clause, allowing this bill to take effect
immediately upon enactment.
EXISTING LAW :
1)Creates the Fair Political Practices Commission (FPPC), and
makes it responsible for the impartial, effective
administration and implementation of the Political Reform Act
(PRA).
2)Requires an individual to file a statement of intention to
become a candidate for an elective office, signed under
penalty of perjury, prior to soliciting or receiving a
contribution or loan.
3)Requires an individual, upon filing a statement of intention
to become a candidate for an elective office, to establish one
campaign contribution account at an office of a financial
institution located in the state. Requires all contributions
or loans made to the candidate, to a person on behalf of the
candidate, or to the candidate's controlled committee, to be
deposited into the account. Requires all campaign
expenditures to be made from the account, except as specified.
4)Prohibits an individual from filing for more than one office
at the same election.
FISCAL EFFECT : Unknown. State-mandated local program;
contains a crimes and infractions disclaimer.
COMMENTS :
1)Purpose of the Bill : According to the author:
There is a need to build and restore government trust
in the election process. The belief that money buys
influence from elected legislators has led to laws
that attempt to diminish the influence of money.
Currently, the PRA limits campaign contributions to
$4,100 per person for candidates or office holders
that are running for California State Senate and
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Assembly. Candidates running for statewide
constitutional offices have contribution limits of
$6,800 per person, with the exception of the Governor
who has a limit of $26,000. Despite the contribution
limits, an individual who decides to open two
candidate-controlled committees can cumulatively
generate more money than what is legally permitted and
undermine the effectiveness of existing campaign
contribution limits.
Currently, it is legal to declare an intention to run
for more than one office at a time. By simply
expressing the intent to run for multiple offices an
official may open multiple campaign committees. These
multiple campaign committees can potentially be used
to cumulatively raise funds far in
excess of the established campaign contribution
limits.
Finally, according to the FPPC, "more than $60 million
has been raised for races held one, three, even five
years in the future with many candidates raising money
into multiple committees for different offices at the
same time."
The FPPC goes on to say that "while this practice is
perfectly legal, it can often be difficult to
ascertain the total amount raised or spent by a given
candidate because of their ability to maintain
multiple committees."
2)Statements of Intention vs. Nomination Papers : A statement of
intention to be a candidate for an elective office serves as a
notice of an individual's intent to raise campaign
contributions toward seeking a particular office. Nomination
papers, including declarations of candidacy, are filed with
elections officials in order for the individual's name to
appear on the ballot as an actual candidate for the office.
3)Contribution Limits : The author contends that permitting
individuals to raise campaign contributions for multiple
elective state offices at the same time could allow that
individual to circumvent the applicable contribution limits in
place for the individual offices. Currently, the limits for
campaign contributions to candidates for elective state office
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are as follows:
To a candidate for elective state office other than a
candidate for statewide elective office, no person may
contribute more than $4,100 per election and no small
contributor committee may contribute more than $8,200 per
election;
To a candidate for elective statewide office other than
a candidate for Governor, no person may contribute more
than $6,800 per election and no small contributor committee
may contribute more than $13,600 per election;
To a candidate for Governor, no person or small
contributor committee may contribute more than $27,200 per
election.
Notwithstanding the author's concern about the potential for
candidates to circumvent the contribution limits, the PRA and
regulations adopted by the FPPC already contain provisions to
protect against such circumvention. When a person files a
statement of intention to be a candidate, the PRA requires
that statement to be filed under penalty of perjury. As a
result, any person who filed a statement of intention for an
office that the person had no intention of seeking could be
charged with perjury. Once a candidate files a statement of
intention, and raises money into a committee associated with
that statement of intention, expenditures from that committee
must be related to the campaign for the office that the
candidate stated an intention to seek. Furthermore, any
transfers of funds between two committees for the same
candidate are subject to rules that require those funds to be
attributed to individual contributors at the time the funds
are transferred, thereby protecting against the circumvention
of contribution limits. As a result, the extent to which
campaign contribution limits can be circumvented through the
use of multiple candidate committees under existing law is
unclear.
1)Automatic Revocation of Statements of Intention : Because
existing law does not provide for the automatic revocation of
statements of intention to be a candidate, neither the PRA nor
regulations developed by the FPPC include a procedure or a
timeline for a candidate to close the committee that is
associated with the statement of intention that was revoked.
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It is unclear, for instance, how long a candidate would have
to dispense with funds that were raised by that committee.
For example, if a candidate intended to run for the Board of
Equalization (BOE), and raised money under the contribution
limits in place for that office (currently $6,800 per
election), but subsequently decided to run for the state
Senate instead, that candidate may not be able to transfer all
funds from the BOE account into the new Senate account, since
the contribution limits for state Senate are lower (currently
$4,100 per election) than for BOE. A candidate in such a
position would be required to dispense with any funds in the
BOE account that are unable to be transferred, including
potentially refunding portions of certain contributions, but
the rules that would control such a process are unclear.
Unless this bill is amended to establish these procedures and
timelines, it would be incumbent upon the FPPC to address
these issues via regulation or advice.
2)Limit of Two Campaign Contribution Accounts : One provision of
this bill prohibits a candidate from having more than two
campaign contribution accounts open simultaneously for
purposes of receiving contributions in connection with
elective state offices. A small number of candidates
currently have more than two campaign accounts open for the
purposes of receiving contributions in connection with
elective state offices. Presumably, those candidates would be
required to close campaign accounts prior to the effective
date of this bill. In most cases where a candidate has more
than two accounts open, one or more of the open accounts are
for elections that have already occurred, and where the
candidate has not yet terminated the committee for that
previously-held election.
3)Special Elections and Suggested Amendments : By prohibiting
individuals from filing a statement of intention to be a
candidate for an elective state office at an election other
than the next election at which that elective state office
will appear on the ballot (or, in the case of a candidate for
Assembly, for an election other than the next two elections at
which the office will appear on the ballot), this bill could
prevent candidates from being able to raise money for a
regularly scheduled election that occurs at or around the same
time as a special election held to fill a vacancy in the same
seat.
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For example, if a vacancy occurred in a seat in the State Senate
in November of the year prior to the final year of the term of
office, a special election would be held to fill that vacancy
for the remainder of the term. The special primary election
to fill that seat could be held in the following January or
February, with the special runoff election (if necessary) held
in March or April. The primary election for the next full
term of office for that seat would then be on the ballot in
June, with the general election in November. Under the
provisions of this bill, a candidate who filed a statement of
intention to be a candidate in the special vacancy election
would be unable to file a statement of intention to be a
candidate for the full term of office at the election held
just months later. In fact, it is possible that the deadline
to file as a candidate for the full term of office could pass
before a candidate was legally able to file a statement of
intention to be a candidate at that election.
To address these concerns, committee staff recommends the
following amendments to this bill:
On page 3, line 6, after "two", insert:
regularly scheduled
On page 3, line 10, after "next", insert:
regularly scheduled
4)Urgency Clause and Suggested Amendment : As noted above, this
bill contains an urgency clause, and would go into effect
immediately upon enactment. As noted above, however, the
enactment of this bill could require a number of candidates to
close campaign committees. Furthermore, given the deadlines
for the Governor to act on bills that are approved by the
Legislature this year, it is possible that this bill could be
signed into law as little as five weeks before the November
election. Changing campaign finance rules so close to the
date of a statewide election could create confusion, and could
hamper the implementation and enforcement of the law.
To address these concerns, committee staff recommends that this
bill be amended to remove the urgency clause.
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5)Political Reform Act of 1974 : California voters passed an
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. Amendments to the PRA that are not
submitted to the voters, such as those contained in this bill,
must further the purposes of the initiative and require a
two-thirds vote of both houses of the Legislature.
REGISTERED SUPPORT / OPPOSITION :
Support
California League of Conservation Voters (prior version)
League of Women Voters of California (prior version)
MapLight (prior version)
Opposition
None on file.
Analysis Prepared by : Ethan Jones / E. & R. / (916) 319-2094