BILL NUMBER: AB 10	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Gatto

                        DECEMBER 1, 2014

   An act to amend Sections 82033, 82034, 87103, 87206, and 87207 of,
and to add Sections 87206.5 and 87211 to, the Government Code,
relating to the Political Reform Act of 1974.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 10, as introduced, Gatto. Political Reform Act of 1974:
economic interest disclosures.
   The Political Reform Act of 1974 prohibits a public official at
any level of state or local government from making, participating in
making, or in any way attempting to use his or her official position
to influence a governmental decision in which the public official
knows or has reason to know that he or she has a financial interest.
A public official has a financial interest in a governmental decision
if it is reasonably foreseeable that the decision will have a
material financial effect, distinguishable from its effect on the
public generally, on a business entity in which the public official
has a direct or indirect investment worth $2,000 or more, real
property in which the public official has a direct or indirect
interest worth $2,000 or more, and sources of income aggregating $500
or more in value within 12 months prior to the time when the
decision is made.
   The Political Reform Act of 1974 requires persons holding
specified public offices to file disclosures of investments, real
property interests, and income within specified periods of assuming
or leaving office, and annually while holding the office. The act
requires the disclosures to include a statement indicating, within a
specified value range, the fair market value of investments or
interests in real property and the aggregate value of income received
from a source.
   This bill would increase the thresholds at which a public official
has a disqualifying financial interest in sources of income from
$500 to $1,000, in investments in business entities from $2,000 to
$5,000, and in interests in real property from $2,000 to $10,000.
   The bill would make conforming adjustments to the thresholds at
which income, investments, and interests in real property must be
disclosed on a public official's statement of economic interests. The
bill would also revise the dollar amounts associated with the value
ranges for reporting the value of economic interests.
   This bill would require certain public officials to disclose
information on the official's statement of economic interests
relating to governmental decisions for which the public official had
a disqualifying financial interest, as specified.
   Existing law makes a knowing or willful violation of the act a
misdemeanor and subjects offenders to criminal penalties.
   By creating additional crimes, this bill would impose a
state-mandated local program.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   The Political Reform Act of 1974, an initiative measure, provides
that the Legislature may amend the act to further the act's purposes
upon a 2/3 vote of each house and compliance with specified
procedural requirements.
   This bill would declare that it furthers the purposes of the act.

   Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 82033 of the Government Code is amended to
read:
   82033.  "Interest in real property" includes any leasehold,
beneficial or ownership interest or an option to acquire such an
interest in real property located in the jurisdiction owned directly,
indirectly or beneficially by the public official, or other filer,
or his or her immediate family if the fair market value of the
interest is  two   ten  thousand dollars
 ($2,000)   ($10,000)  or more. Interests
in real property of an individual includes a pro rata share of
interests in real property of any business entity or trust in which
the individual or immediate family owns, directly, indirectly or
beneficially, a 10-percent interest or greater.
  SEC. 2.  Section 82034 of the Government Code is amended to read:
   82034.  "Investment" means any financial interest in or security
issued by a business entity, including, but not limited to, common
stock, preferred stock, rights, warrants, options, debt instruments,
and any partnership or other ownership interest owned directly,
indirectly, or beneficially by the public official, or other filer,
or his or her immediate family, if the business entity or any parent,
subsidiary, or otherwise related business entity has an interest in
real property in the jurisdiction, or does business or plans to do
business in the jurisdiction, or has done business within the
jurisdiction at any time during the two years prior to the time any
statement or other action is required under this title. An asset
shall not be deemed an investment unless its fair market value equals
or exceeds  two   five  thousand dollars
 ($2,000)   ($5,000)  . The term
"investment" does not include a time or demand deposit in a financial
institution, shares in a credit union, any insurance policy,
interest in a diversified mutual fund registered with the Securities
and Exchange Commission under the Investment Company Act of 1940 or
in a common trust fund created pursuant to Section  1564
  1585  of the Financial Code, interest in a
government defined-benefit pension plan, or any bond or other debt
instrument issued by any government or government agency. Investments
of an individual includes a pro rata share of investments of any
business entity, mutual fund, or trust in which the individual or
immediate family owns, directly, indirectly, or beneficially, a
10-percent interest or greater. The term "parent, subsidiary or
otherwise related business entity" shall be specifically defined by
regulations of the commission.
  SEC. 3.  Section 87103 of the Government Code is amended to read:
   87103.  A public official has a financial interest in a decision
within the meaning of Section 87100 if it is reasonably foreseeable
that the decision will have a material financial effect,
distinguishable from its effect on the public generally, on the
official, a member of his or her immediate family, or on any of the
following:
   (a) Any business entity in which the public official has a direct
or indirect investment worth  two   five 
thousand dollars  ($2,000)   ($5,000)  or
more.
   (b) Any real property in which the public official has a direct or
indirect interest worth  two   ten 
thousand dollars  ($2,000)   ($10,000)  or
more.
   (c) Any source of income, except gifts or loans by a commercial
lending institution made in the regular course of business on terms
available to the public without regard to official status,
aggregating  five hundred dollars ($500)   one
thousand dollars ($1,000)  or more in value provided or promised
to, received by, the public official within 12 months prior to the
time when the decision is made.
   (d) Any business entity in which the public official is a
director, officer, partner, trustee, employee, or holds any position
of management.
   (e) Any donor of, or any intermediary or agent for a donor of, a
gift or gifts aggregating two hundred fifty dollars ($250) or more in
value provided to, received by, or promised to the public official
within 12 months prior to the time when the decision is made. The
amount of the value of gifts specified by this subdivision shall be
adjusted biennially by the commission to equal the same amount
determined by the commission pursuant to subdivision (f) of Section
89503.
   For purposes of this section, indirect investment or interest
means any investment or interest owned by the spouse or dependent
child of a public official, by an agent on behalf of a public
official, or by a business entity or trust in which the official, the
official's agents, spouse, and dependent children own directly,
indirectly, or beneficially a 10-percent interest or greater.
  SEC. 4.  Section 87206 of the Government Code is amended to read:
   87206.  If an investment  or an interest in real property
 is required to be disclosed under this article, the
statement shall contain  all of the following  :
   (a) A statement of the nature of the investment  or
interest  .
   (b) The name of the business entity in which each investment is
held, and a general description of the business activity in which the
business entity is engaged.  However, if the filer has a
financial interest in the business entity pursuant to subdivision (d)
of Section 87103, the filer shall provide a thorough and detailed
description of the business entity's activities and disclose the
names of all business part   ners who share a financial
interest in the business entity, based on criteria established by the
Commission.  
   (c) The address or other precise location of the real property.
 
   (d) 
    (c)  A statement  whether  
indicating which of the following represents  the fair market
value of the investment  or interest in real property equals
or exceeds two thousand dollars ($2,000) but does not exceed ten
thousand dollars ($10,000), whether it exceeds ten thousand dollars
($10,000) but does not exceed one hundred thousand dollars
($100,000), whether it exceeds one hundred thousand dollars
($100,000) but does not exceed one million dollars ($1,000,000), or
whether it exceeds one million dollars ($1,000,000).   :
 
   (1) At least five thousand dollars ($5,000) but not greater than
ten thousand dollars ($10,000).  
   (2) Greater than ten thousand dollars ($10,000) but not greater
than one hundred thousand dollars ($100,000).  
   (3) Greater than one hundred thousand dollars ($100,000) but not
greater than two hundred fifty thousand dollars ($250,000). 

   (4) Greater than two hundred fifty thousand dollars ($250,000) but
not greater than five hundred thousand dollars ($500,000). 

   (5) Greater than five hundred thousand dollars ($500,000) but not
greater than one million dollars ($1,000,000).  
   (6) Greater than one million dollars ($1,000,000) but not greater
than two million dollars ($2,000,000).  
   (7) Greater than two million dollars ($2,000,000). 
    (d)    In the case of a statement filed under
 Sections   Section  87203 or 87204, if the
investment  or interest in real property  was
partially or wholly acquired or disposed of during the period covered
by the statement, the date of acquisition or disposal. 
   (f) For purposes of disclosure under this article, "interest in
real property" does not include the principal residence of the filer
or any other property which the filer utilizes exclusively as the
personal residence of the filer. 
  SEC. 5.  Section 87206.5 is added to the Government Code, to read:
   87206.5.  (a) If an interest in real property is required to be
disclosed under this article, the statement shall contain all of the
following:
   (1) A statement of the nature of the interest.
   (2) The address or other precise location of the real property.
   (3) A statement indicating which of the following represents the
fair market value of the interest in real property:
   (A) At least ten thousand dollars ($10,000) but not greater than
two hundred fifty thousand dollars ($250,000).
   (B) Greater than two hundred fifty thousand dollars ($250,000) but
not greater than five hundred thousand dollars ($500,000).
   (C) Greater than five hundred thousand dollars ($500,000) but not
greater than seven hundred fifty thousand dollars ($750,000).
   (D) Greater than seven hundred fifty thousand dollars ($750,000)
but not greater than one million dollars ($1,000,000).
   (E) Greater than one million dollars ($1,000,000) but not greater
than two million dollars ($2,000,000).
   (F) Greater than two million dollars ($2,000,000).
   (4) In the case of a statement filed under Section 87203 or 87204,
if the interest in real property was partially or wholly acquired or
disposed of during the period covered by the statement, the date of
acquisition or disposal.
   (b) For purposes of disclosure under this article, "interest in
real property" does not include the principal residence of the filer
or any other property that the filer utilizes exclusively as the
personal residence of the filer.
  SEC. 6.  Section 87207 of the Government Code is amended to read:
   87207.  (a)  When   Except as provided in
subdivision (b), if  income is required to be reported under
this article, the statement shall contain  , except as
provided in subdivision (b)   all of the following 
:
   (1) The name and address of each source of income aggregating
 five hundred dollars ($500)   one thousand
dollars ($1,000)  or more in value, or fifty dollars ($50) or
more in value if the income was a gift, and a general description of
the business activity, if any, of each source.  However, if the
source of income is a business entity in which the filer has a
financial interest pursuant to subdivision (d) of Section 87103, the
filer shall provide a thorough and detailed description of the
business entity's activities, based on criteria established by the
Commission. 
   (2) A statement  whether   indicating which
of the following represents  the aggregate value of income from
each source, or in the case of a loan, the highest amount owed to
each  source, was at least five hundred dollars ($500) but
did not exceed one thousand dollars ($1,000), whether it was in
excess of one thousand dollars ($1,000) but was not greater than ten
thousand dollars ($10,000), whether it was greater than ten thousand
dollars ($10,000) but not greater than one hundred thousand dollars
($100,000), or whether it was greater than one hundred thousand
dollars ($100,000).   source:  
   (A) At least one thousand dollars ($1,000) but not greater than
ten thousand dollars ($10,000).  
   (B) Greater than ten thousand dollars ($10,000) but not greater
than one hundred thousand dollars ($100,000).  
   (C) Greater than one hundred thousand dollars ($100,000) but not
greater than two hundred fifty thousand dollars ($250,000). 

   (D) Greater than two hundred fifty thousand dollars ($250,000) but
not greater than five hundred thousand dollars ($500,000). 

   (E) Greater than five hundred thousand dollars ($500,000). 
   (3) A description of the consideration, if any, for which the
income was received.
   (4) In the case of a gift, the amount and the date on which the
gift was received.
   (5) In the case of a loan, the annual interest rate, the security,
if any, given for the loan, and the term of the loan.
   (b) When the filer's pro rata share of income to a business
entity, including income to a sole proprietorship, is required to be
reported under this article, the statement shall contain  the
following  :
   (1) The name, address, and a  general  
thorough and detailed  description of the business activity of
the business entity.
   (2) The name of every person from whom the business entity
received payments if the filer's pro rata share of gross receipts
from that person was equal to or greater than ten thousand dollars
($10,000) during a calendar year.
   (c) When a payment, including an advance or reimbursement, for
travel is required to be reported pursuant to this section, it may be
reported on a separate travel reimbursement schedule which shall be
included in the filer's statement of economic interest. A filer who
chooses not to use the travel schedule shall disclose payments for
travel as a gift, unless it is clear from all surrounding
circumstances that the services provided were equal to or greater in
value than the payments for the travel, in which case the travel may
be reported as income.
  SEC. 7.  Section 87211 is added to the Government Code, to read:
   87211.  (a) A public official who holds an office specified in
Section 87200 shall disclose on his or her statement of economic
interests each governmental decision for which a financial interest
resulted in the public official's disqualification from making,
participating in making, or in any way attempting to use his or her
official position to influence that governmental decision pursuant to
Section 87100 or, for a Member of the Legislature, Section 87102.5.
The disclosure shall identify the governmental decision, the date
that the governmental decision was made or considered, the financial
interest that created the conflict of interests, and any other
relevant information that the Commission deems appropriate.
   (b) The disclosures required by this section are in addition to
any other required disclosures, including, but not limited to, the
requirements of Section 87105.
  SEC. 8.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.
  SEC. 9.  The Legislature finds and declares that this bill furthers
the purposes of the Political Reform Act of 1974 within the meaning
of subdivision (a) of Section 81012 of the Government Code.