BILL NUMBER: AB 10 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 7, 2015
INTRODUCED BY Assembly Member Gatto
DECEMBER 1, 2014
An act to amend Sections 82015, 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 amended, Gatto. Political Reform Act of 1974:
behested payments and economic interest disclosures.
(1) The Political Reform Act of 1974 requires elected officers,
candidates, and committees to file semiannual campaign statements
that include, among other things, the total amount of contributions
received during the period covered by the campaign statement and the
total cumulative amount of contributions received. The act provides
that contributions include a payment made at the behest of a
candidate unless full and adequate consideration is received from the
candidate or it is clear from the surrounding circumstances that the
payment was made for purposes unrelated to his or her candidacy for
elective office. The act provides that a payment made principally for
legislative, governmental, or charitable purposes is presumed to be
made for purposes unrelated to a candidate's candidacy for elective
office and is neither a gift nor a contribution. The act requires a
payment of this type made at the behest of a candidate who is an
elected officer to be reported within 30 days following the date on
which the payment or payments equal or exceed $5,000 in the aggregate
from the same source in the same calendar year in which the payments
are made.
This bill would also require candidates who are required to file
campaign statements, and elected officers for one year after they
leave elective office, to report within 30 days following the date on
which a behested payment or payments are made for legislative,
governmental, or charitable purposes that equal or exceed $5,000 in
the aggregate from the same source in the same calendar year in which
the payments are made.
The
(2) 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
(3) 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
(4) 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 82015 of the
Government Code is amended to read:
82015. (a) "Contribution" means 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.
(b) (1) A payment made at the behest of a committee, as defined in
subdivision (a) of Section 82013, is a contribution to the committee
unless full and adequate consideration is received from the
committee for making the payment.
(2) A payment made at the behest of a candidate is a contribution
to the candidate unless the criteria in either subparagraph (A) or
(B) are satisfied:
(A) Full and adequate consideration is received from the
candidate.
(B) It is clear from the surrounding circumstances that the
payment was made for purposes unrelated to his or her candidacy for
elective office. The following types of payments are presumed to be
for purposes unrelated to a candidate's candidacy for elective
office:
(i) A payment made principally for personal purposes, in which
case it may be considered a gift under the provisions of
Section 82028. Payments that are otherwise subject to the
limits of Section 86203 are presumed to be principally for personal
purposes.
(ii) A payment made by a state, local, or federal governmental
agency or by a nonprofit organization that is exempt from taxation
under Section 501(c)(3) of the Internal Revenue Code.
(iii) A payment not covered by clause (i), made principally for
legislative, governmental, or charitable purposes, in which case it
is neither a gift nor a contribution. However, payments of this type
that are made at the behest of a candidate who is required to
file a campaign statement, a candidate who is an elected
officer officer, or an elected officer for
one year aft er he or she leaves elective office,
shall be reported within 30 days following the date on which the
payment or payments equal or exceed five thousand dollars ($5,000) in
the aggregate from the same source in the same calendar year in
which they are made. The report shall be filed by the
elected officer filed, for a candidate who is required
to file a campaign statement, with the officials and
agencies he or she is required to file his or her campaign statement,
for an elected officer, with the elected officer's
agency and agency, and for an elected officer for the
one year after he or she has left elective office, with the agency
the elected officer was required to file the statement when he or she
was an elected officer. The report shall be a public record
subject to inspection and copying pursuant to subdivision
(a) of Section 81008. The report shall contain the
following information: name of payor, address of payor, amount of the
payment, date or dates the payment or payments were made, the name
and address of the payee, a brief description of the goods or
services provided or purchased, if any, and a description of the
specific purpose or event for which the payment or payments were
made. Once the five-thousand-dollar ($5,000) aggregate threshold from
a single source has been reached for a calendar year, all payments
for the calendar year made by that source shall be disclosed within
30 days after the date the threshold was reached or the payment was
made, whichever occurs later. Within 30 days after receipt of the
report, state agencies shall forward a copy of these reports to the
Commission, and local agencies shall forward a copy of these reports
to the officer with whom candidates for, and elected
officers of of, that agency file their
campaign statements.
(C) For purposes of subparagraph (B), a payment is made for
purposes related to a candidate's candidacy for elective office if
all or a portion of the payment is used for election-related
activities. For purposes of this subparagraph, "election-related
activities" shall include, but are not limited to, the following:
(i) Communications that contain express advocacy of the nomination
or election of the candidate or the defeat of his or her opponent.
(ii) Communications that contain reference to the candidate's
candidacy for elective office, the candidate's election campaign, or
the candidate's or his or her opponent's qualifications for elective
office.
(iii) Solicitation of contributions to the candidate or to third
persons for use in support of the candidate or in opposition to his
or her opponent.
(iv) Arranging, coordinating, developing, writing, distributing,
preparing, or planning of any communication or activity described in
clause (i), (ii), or (iii).
(v) Recruiting or coordinating campaign activities of campaign
volunteers on behalf of the candidate.
(vi) Preparing campaign budgets.
(vii) Preparing campaign finance disclosure statements.
(viii) Communications directed to voters or potential voters as
part of activities encouraging or assisting persons to vote if the
communication contains express advocacy of the nomination or election
of the candidate or the defeat of his or her opponent.
(D) A contribution made at the behest of a candidate for a
different candidate or to a committee not controlled by the behesting
candidate is not a contribution to the behesting candidate.
(3) A payment made at the behest of a member of the Public
Utilities Commission, made principally for legislative, governmental,
or charitable purposes, is not a contribution. However, payments of
this type shall be reported within 30 days following the date on
which the payment or payments equal or exceed five thousand dollars
($5,000) in the aggregate from the same source in the same calendar
year in which they are made. The report shall be filed by the member
with the Public Utilities Commission and shall be a public record
subject to inspection and copying pursuant to subdivision
(a) of Section 81008. The report shall contain the
following information: name of payor, address of payor, amount of the
payment, date or dates the payment or payments were made, the name
and address of the payee, a brief description of the goods or
services provided or purchased, if any, and a description of the
specific purpose or event for which the payment or payments were
made. Once the five-thousand-dollar ($5,000) aggregate threshold from
a single source has been reached for a calendar year, all payments
for the calendar year made by that source shall be disclosed within
30 days after the date the threshold was reached or the payment was
made, whichever occurs later. Within 30 days after receipt of the
report, the Public Utilities Commission shall forward a copy of these
reports to the Fair Political Practices Commission.
(c) "Contribution" includes the purchase of tickets for events
such as dinners, luncheons, rallies, and similar fundraising events;
the candidate's own money or property used on behalf of his or her
candidacy, other than personal funds of the candidate used to pay
either a filing fee for a declaration of candidacy or a candidate
statement prepared pursuant to Section 13307 of the Elections Code;
the granting of discounts or rebates not extended to the public
generally or the granting of discounts or rebates by television and
radio stations and newspapers not extended on an equal basis to all
candidates for the same office; the payment of compensation by any
person for the personal services or expenses of any other person if
the services are rendered or expenses incurred on behalf of a
candidate or committee without payment of full and adequate
consideration.
(d) "Contribution" further includes any transfer of anything of
value received by a committee from another committee, unless full and
adequate consideration is received.
(e) "Contribution" does not include amounts received pursuant to
an enforceable promise to the extent those amounts have been
previously reported as a contribution. However, the fact that those
amounts have been received shall be indicated in the appropriate
campaign statement.
(f) (1) Except as provided in paragraph (2) or (3), "contribution"
does not include 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 five hundred dollars ($500) or less.
(2) "Contribution" includes 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, including the value of the use of
the home as a fundraising event venue. A payment described in this
paragraph shall be attributable to the lobbyist for purposes of
Section 85702.
(3) "Contribution" includes 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.
(g) Notwithstanding the foregoing definition of "contribution,"
the term does not include volunteer personal services or payments
made by any individual for his or her own travel expenses if the
payments are made voluntarily without any understanding or agreement
that they shall be, directly or indirectly, repaid to him or her.
(h) "Contribution" further includes the payment of public moneys
by a state or local governmental agency for a communication to the
public that satisfies both of the following:
(1) The communication expressly advocates the election or defeat
of a clearly identified candidate or the qualification, passage, or
defeat of a clearly identified measure, or, taken as a whole and in
context, unambiguously urges a particular result in an election.
(2) The communication is made at the behest of the affected
candidate or committee.
(i) "Contribution" further includes a payment made by a person to
a multipurpose organization as defined and described in Section
84222.
SECTION 1. SEC. 2. 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 ten thousand dollars ($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. SEC. 3. 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 five thousand dollars ($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 (15 U.S.C.
80a-1 et seq.) or in a common trust fund created pursuant to
Section 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. Commission.
SEC. 3. SEC. 4. 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 five thousand dollars ($5,000) or more.
(b) Any real property in which the public official has a direct or
indirect interest worth ten thousand dollars ($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 one thousand dollars ($1,000) or more in value provided
or promised to, received by, the public official within 12 months
prior to before 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 before 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. SEC. 5. Section 87206 of the
Government Code is amended to read:
87206. If an investment 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.
(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, If a filer is required
to report on his or her statement of economic interests a business
entity investment in which the filer is a director, officer, partner,
or trustee, the filer shall provide a thorough and detailed
description of the business entity's activities and disclose the
names of all business partners who share a financial interest in the
business entity, based on criteria established by the Commission.
(c) A statement indicating which of the following represents the
fair market value of the investment:
investment:
(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 Section 87203 or 87204,
if the investment was partially or wholly acquired or disposed of
during the period covered by the statement, the date of acquisition
or disposal.
SEC. 5. SEC. 6. 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
uses exclusively as the personal residence of the filer.
SEC. 6. SEC. 7. Section 87207 of the
Government Code is amended to read:
87207. (a) Except as provided in subdivision (b), if income is
required to be reported under this article, the statement shall
contain all of the following:
(1) The name and address of each source of income aggregating 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 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:
(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 thorough and detailed description of
the business activity of the business entity.
entity based on criteria established by the Commission.
(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
, 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. SEC. 8. 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. SEC. 9. 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. SEC. 10. 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.