BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 1441|
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UNFINISHED BUSINESS
Bill No: SB 1441
Author: Lara (D), Corbett (D), Lara (D), Corbett (D), De León
(D), Hill (D),
Monning (D), Roth (D), Steinberg (D), and Torres (D),
et al.
Amended: 8/14/14
Vote: 27
SENATE ELEC. & CONST. AMEND. COMMITTEE : 5-0, 4/22/14
AYES: Torres, Anderson, Hancock, Jackson, Padilla
SENATE APPROPRIATIONS COMMITTEE : 6-0, 5/5/14
AYES: De León, Walters, Gaines, Hill, Lara, Steinberg
NO VOTE RECORDED: Padilla
SENATE FLOOR : 33-0, 5/12/14
AYES: Anderson, Beall, Berryhill, Block, Cannella, Corbett,
Correa, De León, DeSaulnier, Fuller, Galgiani, Hancock,
Hernandez, Hill, Hueso, Huff, Jackson, Lara, Leno, Lieu, Liu,
Mitchell, Monning, Morrell, Padilla, Pavley, Roth, Steinberg,
Torres, Vidak, Walters, Wolk, Wyland
NO VOTE RECORDED: Calderon, Evans, Gaines, Knight, Nielsen,
Wright, Yee
ASSEMBLY FLOOR : 78-0, 8/27/14 - See last page for vote
SUBJECT : Political Reform Act of 1974: contributions
SOURCE : Author
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DIGEST : This bill revises the definition of contribution to
include a payment made by a lobbyist or a cohabitant of a
lobbyist for costs related to a fundraising event held at the
home of the lobbyist, as specified. This bill makes these
payments attributable to the lobbyist for purposes of the
prohibition against a lobbyist making a contribution to
specified candidates and elected officers.
Assembly Amendments are clarifying and technical, and add
co-authors.
ANALYSIS :
Existing law:
1. Provides pursuant to the Political Reform Act (PRA), for the
comprehensive regulation of campaign financing, including
requiring the reporting of campaign contributions and
expenditures and imposing other reporting and recordkeeping
requirements on campaign committees.
2. Defines "contribution" for purposes of the PRA as a payment,
a forgiveness of a loan, a payment of a loan by a third
party, or an enforceable promise to make a payment, except to
the extent that full and adequate consideration is received,
unless it is clear from the surrounding circumstances that it
is not made for political purposes.
3. Excludes a payment made by an occupant of a home or office
for costs related to any meeting or fundraising event held in
the occupant's home or office if the costs for the meeting or
fundraising event are $500 or less in the definition of
"contribution."
4. Prohibits a lobbyist from making, and an elected state
officer or candidate for elective state office from
accepting, a contribution if the lobbyist is registered to
lobby the governmental agency for which the candidate is
seeking election or the governmental agency of the elected
state officer.
This bill:
1. Provides that a payment made by a lobbyist or a cohabitant of
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a lobbyist for costs related to a fundraising event held at
the home of the lobbyist, including the value of the use of
the home as a fundraising event venue, is a contribution for
the purposes of the PRA regardless of the amount of the
payment. Provides that a payment described above is
attributable to the lobbyist for purposes of the prohibition
against a lobbyist making a contribution to an elected state
officer or candidate for elected state office.
2. Provides that a payment made by a lobbying firm for costs
related to a fundraising event held at the office of the
lobbying firm, including the value of the use of the office
as a fundraising event venue, is a contribution for the
purposes of the PRA regardless of the amount of the payment.
Background
Hosted Fundraisers . The PRA, among other things, requires
candidates and committees to disclose contributions made and
received and expenditures made in connection with campaign
activities. The term "contribution" is defined as any payment
for political purposes for which full and adequate consideration
is not provided to the donor.
When individuals or entities make payments in connection with
holding a fundraiser for a candidate, such payments ordinarily
are considered contributions to the candidate. However,
existing law allows for some exceptions. For example, payments
made by the occupant of a home or office for costs related to
any meeting or fundraising event in the occupant's home or
office are not considered contributions under the PRA if the
costs for the meeting or fundraising event are $500 or less.
Although existing law prohibits lobbyists from making
contributions to elected state officers or candidates for
elected state office if that lobbyist is registered to lobby the
governmental agency for which the candidate is seeking election
or the governmental agency of the elected state officer, the
exception to the definition of the term "contribution" for the
purposes of hosted fundraising events does not exclude events
hosted by lobbyists. As a result, a lobbyist could hold a
fundraiser at his/her home and the cost would not be considered
a contribution, as long as the total cost of such an event did
not exceed $500. If other parties donate money or goods in
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connection with the event, their payments must also be counted
to determine if $500 has been spent in connection with the
fundraiser. This includes goods or services provided by the
candidate or any other person attending the event. If the cost
of the event exceeds $500, all payments are counted as
contributions.
Recent Events . In February of this year, the Fair Political
Practice Commission (FPPC) approved a settlement in a case in
which a registered lobbyist hosted campaign fundraisers for
state elective officers and candidates at his house where he
provided items such as beverages, flower arrangements, and
cigars. The FPPC investigated and determined that the total
cost of the fundraisers hosted by the lobbyist at his home,
including the value the items provided by the lobbyist, exceeded
$500. As a result, the items provided by the lobbyist during
the fundraisers constituted non-monetary contributions to the
campaign committees of the elective officers and candidates who
benefitted from the fundraisers - all violations of the PRA. As
a result, the FPPC levied one of the largest penalties against a
lobbyist and issued warning letters to the elected officers and
candidates who benefitted from the fundraisers.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee, minor
absorbable enforcement costs to the FPPC (General Fund).
SUPPORT : (Verified 5/7/14) (Unable to reverify at time of
writing)
Common Cause California
ASSEMBLY FLOOR : 78-0, 8/27/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon,
Gorell, Gray, Grove, Hagman, Hall, Roger Hernández, Holden,
Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,
Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi,
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Nazarian, Nestande, Olsen, Pan, Patterson, Perea, John A.
Pérez, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon,
Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner,
Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, Atkins
NO VOTE RECORDED: Harkey, Vacancy
RM:d 8/27/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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